ENERGY : The Search for a balance
N.K. Bansal

THE energy situation in India demands strategic and thoughtful planning with correct emphasis on various energy sources that are reliable and environment friendly.  Because of its size, India is one of the largest consumer of energy in the developing world and among the top 20 consumers of commercial energy.  On a per capita basis, however the commercial energy use is only one eighth of the world average (=300 kg ce).

India’s importance as a global energy consumer will continue to grow.  In 1991-92, 27 percent of the import bill was accounted for by petroleum. In spite of the increasing use of coal in the energy sector and the large growth of the power sector, India suffers energy shortages that have severe economic side effects.

Pattern of Energy Consumption
Energy in the form of electricity is the major input into industrial and agricultural activities and has a direct impact on the process of economic development.

The pattern of sector wise electricity consumption is given in the Graph A.  The share of electricity in the Indian industry has declined due to growing rural electrification.  The picture gets complicated by the fact that the demand of electricity is likely to double by the year 2004-05 necessitating huge investments that will not readily be forthcoming.

The demand for petroleum products also continues to rise rapidly at an average annual growth rate of 6.4 percent.  The demand in the year 1996-97 is estimated to be 81 million tonnes, with the domestic production being only 44 million tonnes.

Traditional biomass provides from one third to one half of India’s total energy needs and nearly three quarters of all the household energy.  On the national scale fuel wood contributes 65 percent of the total non-commercial energy.  The energy conversion efficiency of biomass fuels, however, remain poor.  In many villages the total energy supply is mainly form biomass resources (as shown in the Graph B).

In spite of large investments nuclear energy has contributed only 0.3 percent to total energy scenario and 2.0 percent in the overall power sector without much record of the actual generation of kilowatt hours.  This is coupled with nuclear hazards posing dangers to humans as demonstrated by cases like Chernobyll.

Energy Shortage and Inefficiencies
Like many quickly developing nations, India suffers energy shortages that have severe energy shortages that have severe economic consequences.  Over the last decade, shortages of coal and electricity have progressively worsened, largely because of low energy prices that do not provide sufficient return to producers.  Electric power generation falls some 10 percent short of demand on a nationwide basis, with even greater shortages in some regions.  Economic losses associated with these power shortages are estimated at 1 to 2 percent of the national income.

The losses would undoubtedly be larger but for the fact that many industries have invested in backup generators.  Unfortunately, these divert capital that might be put to some better use and drive up diesel fuel consumption, further inflating oil imports.

Widespread inefficiency intensifies energy shortfalls.  More than 20 percent of the electricity generated by the nation’s power plants, for example, is lost during transmission and distribution, even though present technology applications have the potential to reduce transmission and distribution losses in developing countries to as low as 7 to 10 percent.  Outdated equipment and processes make Indian industries considerably less efficient than their counterparts in the industrialised world.  For example, steel requires at least twice as much energy to manufacture in Indian than in industrialised countries.

The steel industry, India’s largest energy user, recently a 10 percent energy saving by improving monitoring and operating procedures.  There is potential for greater efficiency, with appropriate investments, to the tune of 45 percent or more.  Boilers, for example burn over 60 percent of the subcontinent’s industrial fuel but fall far below modern efficiency standards.  According to one study, a successful boiler rebuilding and replacement programme could cut national energy consumption in boilers by as much 12 percent by the year 2000.

Another recent study estimated that by 2005, the electricity consumption could be slashed by 20 percent through a combination of measures including refitting in-efficient irrigation pumps, using compact fluorescent instead of incandescent bulbs in newly constructed buildings, improving industrial operations and maintenance, and promoting high-efficiency motors.  Such innovations could be frustrated, however, innovations could be frustrated, however by the electricity shut-down and extreme fluctuations in voltage, experienced in most regions of the country.

Various barriers impede progress towards energy efficiency.  Subsidies that keep energy prices artificially low are the most notable.  Until quite recently, in fact, the price of coal was lower than the cost of production.  As for electricity, the cost of producing one kilowatt-hour (KWh) in 1991 was about 3.5 cents, whereas actual returns were estimated at 2.75 cents pe kWh.  Low tariffs for agricultural operations in particular, have resulted in huge losses for state electricity boards, hindering their ability to augment power generation capacity.  By the end of 1991, the accumulated losses of all state electricity operations due to subsidies was approximately $1.65 billion.  The situation is deteriorating.

Environmental Considerations
The rapid increase in thermal power generations and increased consumption of oil in the transport sector has led to a sharp rise in environmental pollution.  Though accurate estimates are available, the deteriorating conditions in the cities  make it imperative that environmental considerations become a part of the energy policy.

Self reliance continues to be a thrust area in nuclear power development.  Work on 500 Mwe units and the on-going work on fast breeder technology will have to be continued with vigour during the Eighth plan.  However, a major area of concern in this sector has been the inordinate delays in project implementation and the consequent cost over runs.  It is also necessary to set up adequate support facilities in terms of fuel fabrication and reprocessing.

Considering the above, it is worth ascertaining whether the investment in nuclear power is commensurate with the energy it provides.  Are the alternate energy sources getting due attention with proper R&D?  Do we have reliable data and ultimately, what is the best possible path by which energy can be supplied in harmony with the environment?

Energy Policy
The energy policy drawn up by the government of India has the following main elements:
·         Accelerate the development of domestic conventional energy sources viz coal, hydel, oil and nuclear power.
·         Management of demand for oil and other forms of energy.
·         Energy conservation and management.
·         Optimum utilisation of the existing capacity in the country.
·         Development and exploitation of renewable sources of energy to meet the energy requirement of rural communities.
·         Intensify R&D in the field of new and renewable energy sources.
·         Organisation of and training for personnel engaged at various levels in the energy sector.

The policy as such may be sound but the main question that arise are:
·         Whether the allocations for Non-Renewable Sources of Energy are adequate?
·         Is nuclear power not getting an allocation more than it deserves?
·         Are we implementing the policy of the government properly?
·         Should not our energy policy consider environmental issues adequately? If yes how?

The growing environmental damage demands a review of the energy policy.  Thought has to be given to limiting the use of fossils to avoid the greenhouse effect.

The options available are nuclear energy and alternative energy.  However, can nuclear fission reactors provide the energy needed to offset the loss of fossil fuel supply, or can alternative renewable energy sources be the solution, provided more investments are diverted into this area?

(Dr. N.K Bansal is professor at the Centre for Energy Studies, IIT Delhi.  This is an excerpt of a background paper he prepared for a brainstorming session organised by Max Mueller Bhawan and IIT).

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