Review of energy forecasting in India

Abstract

Numerous studies have been carried out in the past with the objective of understanding the energy forecasting system in the US. In India however, the dynamics of the energy planning system have remained largely ignored by academics. This project continues on a study started by Sanchayan Nath in 2010 to review India’s past efforts of energy demand forecasting – to study the availability of this data in the public domain, and to test from the available data if the process of forecasting has shown trends of improvement over the period since energy planning data has been published by the Planning Commission. Energy forecasting is an important part of any country’s planning process as having an understanding of future energy requirements has widespread policy implications for infrastructure development – the need for development of specific energy sources, and consequently investment in renewable and non-renewable sources of energy. These decisions have cascading effects on the economy, as the energy sector has the potential of leading economic growth as more energy supplied can encourage industrial and commercial growth, thereby increasing demand for energy again. This cycle also has profound implications for the environment, as the decision to pursue renewable or non-renewable sources of energy also impacts how we shape our policies towards exploiting these natural resources. Therefore, in this context the need for a robust energy forecasting system cannot be overstated. This project aims at reviewing India’s energy forecasting system since independence, by comparing publicly available forecast data against actual demand to ascertain if an organized energy forecasting system exists, and if our energy planning process has benefited from the years of iteration – by studying trends of improvement over the period since energy planning data has been published by the Planning Commission. The first part of this project was conducted by Sanchayan Nath in 2010, wherein he collected all the publicly available data on energy forecasting at an aggregate and disaggregated level, in addition to conducting a literature review of the history of energy planning in this country. Based on those results, we will now build on his work and attempt to analyze how India’s energy forecasting system has fared, and if the current process of planning is efficient.