Energy in balance3 min read . Updated: 01 Jul 2012, 07:36 PM IST
Energy in balance
Energy in balance
The ancient Chinese word for energy is Qi. It is used to represent life force or energy flow and is a central concept in Chinese medicine and philosophy. It is an equally important idea in Vedic philosophy and is called prana. Ancient cultures understood the seminal role of energy in the conduct of life. Many cultures, either directly or indirectly, consider the sun as the source of all life-force energy.
Before the modern era, to generate energy for society, people relied on their own muscles, on the muscles of domesticated animals, such as horses and oxen, and on water, sun and wind. The technologies that made use of these energy resources are familiar to us all: axes, ploughs, harnesses, wagons and carriages, waterwheels, windmills, and sailing ships. In Europe, water energy was a significant factor for centuries. By the end of the Roman era, waterwheels powered mills to crush grain, full cloth, tan leather, smelt and shape iron, saw wood, and carry out a variety of other early industrial processes.
The invention of the internal combustion engine, scientific developments in distillation and the development of modern techniques to mine crude oil in the 19th and early 20th centuries changed this dramatically. The first bamboo lift for crude oil was believed to be in use in China in the 4th century AD—it was burnt to manufacture salt by evaporating brine—but it wasn’t till 15 centuries later that multiple wells started producing crude oil for distillation.
Peak oil suggests that in any given geographical area, oil production is likely to follow a bell-shaped curve. Hubbert’s models correctly predicted the peak of American oil in the 1970s and Saudi Arabian oil during this decade. These peaks of production have lifted the price of oil by 10 folds in the last 25 years.
The evolution of the global energy source pie in the next 35 years is likely to look very different from the last 35 years. There is a growing body of evidence to suggest that the US may become energy-independent (no imports) in a little more than a decade, thanks mostly to the development of techniques to cost-effectively mine shale oil/gas. Combine this with a rise in natural gas production around the world, a critical stall in the fortunes of nuclear energy (after Fukushima), and a reduction in energy intensity, particularly from automobiles, and you have the makings of a complex and evolving story.
This evolving energy source landscape will have a profound impact on India and its economic fortunes. India is a large net importer of crude oil. Its promising offshore gas finds of the last decade have so far proved to be disappointing in actual contribution. India’s efforts over the last 20 years to pipe conventional natural gas from Turkmenistan, Iran, Qatar, Myanmar and Bangladesh have come to naught.
India must turn to shale gas exploration with purpose and urgency.
India has only just started mapping its shale reserves and rules are not expected to be in place till at least 2013. The primary differences between modern shale gas development and conventional natural gas development are the extensive uses of horizontal (or slant) drilling and high-volume hydraulic fracturing called fracking.
The US and China have several years of a head start on the Indian effort. It takes three to five years for a shale gas discovery to start production and requires an extensive pipeline network to move gas to consumers. Shale gas is not without its (environmental) critics. But it has been approved in many countries within a framework of regulation. India, too, must move quickly.
Someday perhaps, the world will return to Qi, a life force, provided by the sun with non-toxic and environmental-friendly by-products such as water. In the meantime, the world has little choice but to temper demand, diversify energy source and tread as lightly as possible on the environment. Neither the “turn back the clockism" of the environmental purists, nor the slash and burn of the anti-Malthusians appears as the path ahead. We will have to strike a balance.
PS: Patanjali, compiler of the yoga sutras, said, “He who has controlled his prana has also controlled his mind. He who has controlled his mind has also controlled his breath." I paraphrase this in context to mean that the ultimate solution for global energy balance can only come from “controlling" demand. In the meantime, we struggle on.
Narayan Ramachandran is an investor and entrepreneur based in Bangalore. He writes on the interaction between society, government and markets. Comments are welcome at email@example.com
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