Energy security for growth and sustainability

Abstract

“The country is energy Secure when we can supply lifeline energy to all our citizens as well as meet their effective demand for their safe and convenient energy to satisfy various needs at affordable costs at all times with a prescribed confidence level considering shocks and disruptions that can be reasonably expected” -- Expert Committee on Integrated Energy Policy The International Energy Agency (IEA) has developed a simple composite measure of a country’s progress in transition to modern fuels & the degree of maturity of energy end-use. It has been calculated for 75 developing countries only. The composite is a simple average of the following three sub-indicators 1. Per capita commercial energy consumption. 2. Share of commercial energy in total final energy use. 3. Share of population with access to electricity. India ranks a poor 53rd and fares poorly in all three sub-indicators, significantly behind countries like Brazil, Indonesia, and China. With increasing population, urbanization and switch from non-commercial sources1 to commercial sources, vulnerability to supply disruptions will increase. Currently, Oil is the second largest commercial source and provides for 36% of TPES. India imports 70% of her crude oil requirements and is worlds 7th largest importer (4.3% share of world oil). India’s domestic production has stagnated for past 10 years and is believed to have reached a peak. India is the fifth largest energy consumer and will become the third largest in the next two decades. Indian primary energy consumption grew at 4.8% per annum between 1994 and 2004 and the share of total world energy consumption increased from 2.8% in 1994 to 3.7% in 2004. India is one of the fastest growing economies (6% GDP growth past 10 years) in the world. In order to sustain 7% GDP growth through 2030, energy supply has to grow at 4.54% and installed electric capacity has to grow at 5.74%. This study aims at analyzing the concerns of securing energy supplies and to suggest further ways to reduce vulnerability to supply disruptions. It will cover in depth the demand and supply scenario of commercial primary energy supplies – with a focus on the oil industry – and will look at its structure, size and share of total primary energy supply. The study also proposes an approach to devising an integrated energy policy, and comes out with recommendations for the same.