Home/ Industry / Energy/  Energy imports to quadruple by 2027 if policy, use don’t change

New Delhi: India’s energy imports will quadruple by 2027 from its 2012 level of 7 trillion if the country doesn’t put in place policies to moderate consumption and reduce dependence on overseas suppliers, according to a Web-based tool unveiled by the Planning Commission.

Projections by the statistical tool developed by the Plan panel show India’s energy demand will more than double by 2027.

“We currently import about 31% of our total primary energy requirement, and import dependence looks set to increase under any business-as-usual policy," Planning Commission deputy chairman Montek Singh Ahluwalia said in a note explaining the scenarios.

This makes urgent both policy action and changes in energy use. India is the world’s fourth-largest energy consuming nation and imports 80% of its crude oil and 18% of natural gas requirements.

“(High import dependence) imposes a strain on the balance of payments, especially since global energy prices are high, and our energy strategy must be consistent with managing the balance of payments. Second, it jeopardizes energy security," Ahluwalia’s note said.

Consumers, government and industry should lower energy use, choose more energy-efficient products and appliances, and switch to renewable sources of energy, according to the tool. Agriculture and industry must be more efficient in the use of energy and the construction of green buildings should be encouraged.

The online tool doesn’t allow a calculation of the impact of energy pricing. An expert associated with the Planning Commission’s exercise said pricing elements such as tariffs will be included in a second version of the tool, to be released in the next four months.

India’s energy governance is carried out by multiple ministries and even more numerous stakeholders who need to coordinate their efforts, the expert said, requesting anonymity.

“(The tool) can simulate the effect of alternative assumptions about likely changes in key parameters affecting demand and supply," Ahluwalia’s note said. “None of the scenarios presented in this document should be viewed as being endorsed by the Planning Commission at this stage. Our objective in presenting these results is to provide a basis for analysis and informed discussion."

Gurudeo Sinha, an energy expert at New Delhi-based think tank, The Energy and Resources Institute, said, “Such exercises need an organizational set-up to keep updating assumptions that underlie the scenarios or they become dated and irrelevant. It remains to be seen how it will be taken up by a new government after the election."

Sinha also said the models for looking at energy use and production keep changing, and this should be taken into account in any such exercise.

To be sure, Ahluwalia’s note said the alternative scenarios are not a result of any explicit model that takes sectoral interdependence into account, but based on assumptions about growth, energy demand and discussions with sector experts.

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Updated: 28 Feb 2014, 01:13 AM IST
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