Hobson's choice

Hobson's choice

Indias energy dilemma

India is perched on a cleft stick when it comes to adopting a stance at the UN Climate Change summit scheduled in Copenhagen in December next. On the one hand, India is being urged by the developed nations to cut down its greenhouse gas emissions. On the other, it needs a huge surge in economic growth rate over the next few decades to lift the bulk of its one billion plus population from the morass of abject poverty.

The position is very simple. There is a close relationship between the standard of living and energy consumption in the modern world. India’s GDP per capita at PPP (Purchasing Power Parity) in 2008 was around $2,800 per annum; that of the US around $47,000. Equally breathtaking is the contrast in per capita energy consumption per annum: around 500 kilogrammes of oil equivalent (kgoe) per person for India, a world average of 1,688 kgoe/person and a whopping 7,900 kgoe/person for the US.

India is today at the take-off stage of development, which  the USA and western Europe faced towards the end of the 19th century. In the hundred years that followed, with the help of vast quantities of energy derived from coal and oil, the West raised its standard of living to what it is today. Even if India were to aspire to reach one-fourth the present per capita income of the US in the next 20 years, it would have to maintain a blistering GDP growth rate of 8 per cent per annum for the period.

There is a close relationship between growth rate and energy consumption. An expert committee of the Planning Commission headed by Dr Kirit Parikh had in its report submitted in 2005 estimated that for a GDP growth rate of 8 per cent per annum over the next 20 years, the per capita energy consumption would rise by 2031-32 to 1,600 kgoe, which is a 3-fold increase over the present consumption figure.

India has very limited options to cater to this kind of a rise in energy consumption. It has paltry oil reserves and currently imports over 70 per cent of its oil requirement and half of its domestic demand of natural gas. The recent discovery of natural gas reserves in the Krishna-Godavari basin will not reduce this import dependence since demand is rising much faster.

The paucity of indigenous uranium resources has been a major stumbling block in the development of nuclear energy.  Even the miniscule nuclear power capacity of  3779 MWe was running in mid-2008 at half its capacity due to fuel shortage. Following the recent civilian nuclear accord  with the US and lifting of sanctions against India, wild projections are now being made by Indian authorities about the rapid growth of nuclear power capacity in the future to as much as 4,00,000 MWe by 2050, which is a 100-fold increase from current capacity.

But the slow pace of construction in the past belies that premise. Moreover, this nuclear capacity will have to be sustained almost wholly by imported fuel. True, the country has vast amounts of thorium reserves but the establishment of a reliable and viable thorium fuel cycle is still decades away.

A lot of noise is made, especially by ecological activists, about adopting non-fossil fuel based renewable energy technologies. The fact of the matter is that the total potential for renewable technologies (wind, solar photovoltaic, biogas and small hydro) is just about 1,00,000 MW. The actual implemented capacity so far is a miserable 4000 MW.
The main problem here is that the realisation of this energy is in small amounts, geographically scattered and very unsteady in output. It  can certainly not be depended upon for huge blocks of steady power at a single place that fossil fuel sources provide. Additionally, the capital costs are extremely high in comparison with conventional energy sources.

The Parikh Committee has  forecast that “even with a concerted push of 20-fold increase in capacity, renewables can account for (only) around 5-7 per cent of India’s energy mix by 2031-32.”

The  country’s hydropower potential is around 150,000 MW of which only 20 per cent has been realised so far and another 9 per cent is under construction. The slow pace of realisation of potential is attributed to long construction periods for major projects due to their location in difficult terrain. Putting up large scale hydel projects is becoming increasingly difficult  due to anti-dam activism which bases its arguments on large scale displacement of people, submergence of forest land, safety-related issues in earthquake prone areas, etc.

Coal is the only major commercial energy resource which India possesses in substantial quantity. At present, it accounts for over 50 per cent of the commercial energy consumption. Even by 2031-32, it is expected that coal will account for 40 to 45 per cent of energy consumption.

Energy security

India cannot compromise on its energy security and economic growth rate. As shown above, coal will remain the kingpin of its energy security. Unfortunately, this has adverse repercussions for reducing its greenhouse gas emissions.

India’s per capita greenhouse gas emissions is one of the lowest globally at 1.2 tonnes of carbon dioxide equivalent  per year, compared to the global average of 4.22 tonnes and 19.7 tonnes of the US. However, when the per capita is multiplied by India’s massive population of 1.1 billion, the country ends up being the world’s third largest polluter after the US and China.

Five different studies released recently by independent institutions concluded that India’s per capita emissions of carbon dioxide equivalent would reach 2.1 tonnes in 2020 and 3.5 tonnes in 2030. The studies found that India’s total emissions are estimated to reach between four billion and 7.3 billion tonnes of carbon dioxide equivalent by 2031.
So, what India should be bargaining for at the Copenhagen summit is technological and financial aid in implementing coal usage that minimises greenhouse gas emissions such as high efficiency boilers and turbines as well as carbon sequestration methodologies.