1. Reduce, Improve, Replace Ashok Sreenivas Prayas (Energy Group), Pune www.prayaspune.org/peg Energy: The National Perspective and the Way Forward August 23, 2013 To meet the energy challenge

2. Prayas - Energy Group 1 Energy (Policy, Planning & Governance) Electricity Regulation Rural Energy Renewable Energy Coal, Natural Gas Regulation Climate Change Energy Efficiency

3. OVERVIEW OF INDIAN ENERGY SECTOR 2

4. Energy Supply 2010 3 -Coal dominates, will continue to for near to medium future -Significant bio-mass contribution – non commercial, mainly for cooking -Source: TEDDY 2012

5. Energy Use 2010 4 -Residential important, Half of residential use is bio-mass for cooking (66% homes) -Source: TEDDY 2012

6. Projected growth in energy demand Twelfth plan document – Total demand for primary “commercial” energy demand expected to go up from 710 mtoe in 2011-12 to 1220 mtoe 2021-22 (72% over 10 years) – Power capacity expected to increase by 59% during the 12 th five year plan from ~200 GW to ~318 GW Key sectors – Electricity generation – Transport – Industry – Agriculture – Cooking 5

7. INDIA’S ENERGY CHALLENGE 6

8. India’s energy challenge Balancing the three dimensions of the Challenge – Huge Energy poverty – Limited availability of natural resources – Ecological impacts of conventional energy use 7

9. The two faces of India 8

10. Electricity and Development (2010) 9 -Small increase in energy consumption at India’s level correlates with high HDI change -Increase in cheap energy supply important for development

11. Limited access to clean energy 10 Approx. 1 USA (40 Cr) without access to electricity Hours of supply in rural area often as low as 2 hours Approx. 1 Africa (100 Cr) living on less than 100 kWh /household/month Less than 30% use clean energy for cooking Source: Census 2011, NSSO 66th round, Prayas estimates

12. Energy and infrastructure deficit and inequity 11 Half the households do not have pucca houses, toilets, basic health care One-fourth villages have no proper road access, one-fifth no primary school Source: Census, NSSO, PM Sadak Yojana, Prayas estimates

13. 12 Limited natural resources => high import costs  India’s energy imports as % of GDP much higher than many other countries & growing  Impacts  Increased cost of energy (harder to universalize access)  Increased vulnerability to geo-political changes  Trade deficit  Impact on GDP growth

14. Local environment, livelihoods  Respirable Suspended Particulate Matter and SPM beyond thresholds  Similar problems with water resources too – pollution as well as conflicts  Rising resistance to mining, power plants etc. because of environmental damage, weak adherence to expected norms, weak government monitoring 13

15. Climate constraint India has limited role in global problem of climate change – 15% of population but has emitted only 2.5% of GHG emissions – Very low per-capita emissions (~ 2 tons / capita / yr against world average of ~4) But is very vulnerable – Long coastline – Very rainfall dependent Limited global C space remaining – Energy conversion and consumption a major contributor – ~64% in India in 2007 Business-As-Usual not possible 14

16. FRAMEWORKS FOR ENERGY FUTURE 15

17. Development  Growth  Energy  Environment Each of the above links is flexible Policies and structures required to increasingly de-couple the links – Improved developmental policies – Higher Efficiency – Minimising environmental impacts of energy generation and use Frameworks for Energy future 16

18. Frameworks for Energy future RIR in Electricity – Reduce energy use of the affluent, inequity – Improve efficiency of energy use – Replace, fossil fuels with renewable energy ASI in Transport – Avoid travel - Better planning – Shift to better modes – Mass transport, rail for freight, cycle corridors, footpaths with lights – Improve efficiency – Better fuel efficiency, reduced pollution Low input Sustainable Agriculture, Housing, Clothing Preventive & Social Medicine for Health 17

19. RIR – Reduce consumption / inequity Reduce very high-end consumption – Steeply telescopic tariffs at high-end – Solar for ACs Reduce inequity – Huge inequity in access to clean energy between urban and rural, rich and poor 87% rural households use bio-mass/kerosene for cooking against 34% urban 45% rural households have no electricity access against 7% urban – Comprehensive one time push for electricity access Infrastructure, connections, supply, management, promoting economic activities To be seen as an economic investment 18

20. RIR – Improve efficiency of end use 19 Super efficient appliances consuming 40-50% less than the 5-star models, are commercially available in international markets  70% of the infrastructure by 2030 yet to be built – an opportunity  Multi-state Super Efficient Appliances programs like fans  Innovations to crack the agriculture puzzle  Link energy tariff to consumption norm for commercial buildings  Programs like PAT, discouraging inefficient new industry

21. Renewable energy costs falling rapidly – Solar PV tariffs of around Rs. 7 being quoted – Wind tariffs around Rs. 5.5 India resource rich – Practically ‘unlimited’ potential in solar – Huge wind potential (700 – 3000 GW) Challenges of grid integration, storage etc. Socio-environmental impacts to be assessed and addressed early – Land would be a major consideration – Water requirements for CSP … 20 RIR – Replace with renewables

22. CURRENT TRENDS 21

23. Positive trends Many initiatives for efficiency, renewables – Missions under NAPCC – Low carbon committee Increasing momentum for many positive initiatives – Renewables: Solar water heaters, lighting, other applications – Entrepreneur interest in grid interactive small renewable systems – Super efficient fan program and National Wind Mission in 12 th plan New technologies being considered: Shale gas, Coal bed methane etc. 22

24. Positive trends … Official forecasts show Increasing roles for -Efficiency and -Renewable EE potential > Incremental (renewable + nuclear + gas + hydro) 23

25. Renewable Electricity investment of 20,000 Cr (2011-12) in India, growing at 20% p.a Capacity growing at 35%/yr, generation 31% in the last decade 24 Positive trends …

26. Not so positive trends Growth in ACs, Cars, Air travel – Recent fall in car sales due to other factors than policy push 25

27. Not so positive trends … Insufficient attention to ‘Reduce’ Insufficient focus on universalizing clean energy access – 75% decadal supply growth of electricity, 12% growth in household access Governance challenges – Weak capacity of institutions such as BEE, CEA, SNAs, Regulatory institutions – Weak enforcement of environmental norms – Poor coordination across sectors/ministries, Central & State levels – Low informed participation by professionals in regulatory oversight or policy framing – Insufficient transparency and access to information in many key sectors (e.g. coal, oil-gas) 26

28. Discussion Needs careful balancing of multiple objectives such as development, growth, natural resource management and environment 27 What is required – Recognize and acknowledge the magnitude of the problem – Evolve our own models to suit our needs – A dedicated multi-sectoral institution (Energy Analysis Office?) under the Planning Commission or the Prime Minister’s Office – Significantly greater transparency and capacity of governance institutions and policy formulation – Significantly better implementation of existing laws, norms – Greater pro-active participation, involvement of non- Government ‘experts’?