Mains Daily Question
Jan. 29, 2023

Discuss why India needs to ensure diversification of its energy sources from coal and crude oil. Highlight other alternatives with further suggestions towards meeting India's high energy needs, ensuring energy security as well as sustainability. (10 Marks)

Model Answer

Approach:

Introduction: Mention some statistics on the present state of energy share in India

Body: Mention reasons for diversification of the energy basket of India, describe other alternatives for such diversification, and suggest a few steps to further boost such diversification.

Conclusion: Mention the way forward connecting energy diversification to the international scenario.

Answer:

 Over 80%of India’s energy needs are met by three fuels: coal, oil, and solid biomass as per International Energy Agency’s India Energy Outlook 2021. However, there is growing consensus towards the diversification of energy from conventional to non-conventional sources such as solar and wind, green hydrogen, etc.

Reasons India needs to diversify its energy basket further:

  1. Growing consensus against conventional use internationally such as at Sharm El Sheikh declaration of CoP27 pressing for phase down of coal as a fuel. This would contribute to decreased global greenhouse emissions.
  2. Soaring prices of coal and crude oil globally during Russia Ukraine war has again depicted the uncertainty in international markets. Diversification will reduce dependence on imported energy to strengthen the energy security of India.
  3.  Growing price competitiveness: Renewable energy sector has witnessed tremendous advancement in the whole value chain, especially the technology leap enabled by innovation, which has immense potential to drive down the prices of renewables rapidly.
  4.  Renewable energy is a safe bet for the long run: Renewables are being heavily encouraged by policymakers with the average wind or solar farm built for up to 25 to 30 years of operation.
  5.  Supportive government policies: Various incentives and infrastructure and investment promotions are being taken to serve the social and economic growth of the country through non-conventional energies.
  6.  The resource potential of India: Studies conducted recently suggest that with newer technologies available today, the wind energy segment can be scaled 40-64 times more than what it is at present.
  7.  Market development initiatives: Exploring offshore wind, providing solar parks, or constructing a transmission corridor will boost the green economy.

 

Other alternatives to coal and crude oil are:

  • Nuclear energy: Recent times such as Russia Ukraine war providing natural gas supply crunch in Europe are further boosting the move towards nuclear energy. India has put in motion construction activities for 10 'fleet mode' nuclear reactors from 2022 to 2025-26.
  • Biofuels with the opportunity to utilize agricultural waste for fuel generation as India is envisaged in its National biofuel policy boosting a circular economy.
  • Promotion of green hydrogen: It is being described as the fuel of the future due to its potential to provide high energy with no emissions.
  • Small hydroelectric power by building multiple run-off river dams with each having a potential of fewer than 25 Megawatts to impact the environment as well.
  • Research is promoted storage further in solar and wind energy to further boost their reliability to provide a stable base power supply to replace thermal power plants.

Moving forward, key policy options for transitioning India’s energy mix toward more diversification include the following:

  1. Demand-side reforms such as reducing goods and services taxes on electric vehicles and promoting solar photovoltaic technology will encourage consumers to opt for green technology.
  2. Effective implementation of Renewable Energy Certificates and Renewable Purchase Obligations (which complement each other) could be a major factor in driving renewable energy. Incentivizing power generated from renewable energy sources through subsidies or rate cuts, while simultaneously disincentivizing fossil fuels, will also be important.
  3. Tapping financial resources through financial intermediaries and instruments for the renewable energy sector is also important. Green bonds may be attractive to investors as countries prioritize a green recovery from the recession.

India should utilize the host of multiple options present today with dedicated steps towards energy diversification to prove itself as a leader in the global south on energy transition. It should further continue to push advanced countries for providing financial, and technical funding for such transition at international fora to ensure such a transition is just and ensure energy security for most of the global south.

Subjects : Economy Current Affairs
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