Short essay on Energy Scenario in India

The energy scenario is not very satisfactory in India. Although there has been constant increase in the installed capacity for energy generation through the plans the gap between demand and supply of energy is increasing.

The shortfall in energy supply was 7.9 per cent in 1989-90 which increased to 8.5 per cent in 1992-93 and 12.4 per cent in 1999-2000. The peak-demand shortfall is in the range of 20 per cent. This has bottlenecked economic growth.

Ac­cording to an estimate, the opportunity cost of the energy shortage and the peak-demand shortfall is 1.5 per cent of the GDP. The country needs over 55,000 M W of new capacity during the Ninth Plan (feasible addition only 40,000 MW).

The total energy supplies (commercial and non-commercial) increased from 82.7 MTOE (mil­lion tons of oil equivalents) in 1950-51 to about 291 MTOE in 1990-91. In this, the share of non­commercial fuels has declined from 74 per cent to 41 per cent. Fuel wood alone accounts for 65 per cent of the non-commercial energy consumed. In commer­cial energy supplies coal is the principal source of energy.

There has been an increasing trend in the production of primary commercial energy. The out- 6,727 16.7 put by the end of 1991-92 in respect of coal, lignite (Ney veli) and crude oil was about 229 million tones, 12.54 million tones and 30.35 million tons re­spectively and that in respect of natural gas, hydro power and nuclear power about 18.9 million cubic meters, 72.6 billion units and 5.6 billion units re­spectively.

The targets for 1992-93 are 238 million tons for coal, 13.30 million tons for lignite (Neyveli), 28.464 million tons for crude oil, 66.3 billion units for hydro and 7.4 billion units for nuclear power.

There has been a declining trend in the elas­ticity of final consumption of commercial energy with respect to GDP. It is an indicator of its efficient use. The coefficient of elasticity declined from 1.37 during 1970-80 to 0.82 in the subsequent decade mainly due to changing technologies.

There have also been significant changes in the sectored pattern in the use of commercial energy. The share of industry increased from 39.8 per cent in 1953 to 57 per cent in 1980 and then declined to 50.4 per cent in 1990. The share of agricultural sector rose steadily during this period from 1.7 per cent to 6.1 per cent and 9 per cent. The transport sector’s share declined from 46.2 per cent to 23.5 per cent in 1980 and then marginally increased to 24.5 per cent in 1990.

As regards different fuels, the share of coal decreased steadily from 79.6 per cent in 1953 to 39 percent in 1990, that of oil and gas rose from 17.1 per cent to 43.4 per cent and that of electricity from 3.3 per cent to 17.6 per cent. The adverse fallout has been the dependence on imported crude and petro­leum products, causing a heavy drain on foreign exchange reserves. In the total plan outlay, the share for energy increased from 19.7 per cent during the First Plan to 28.2 per cent during the Seventh Plan.

Even at the abysmally low level of per capita consumption; 340 km as against world average of 2,500 km and 8,000 km for the developed coun­tries; the consumption of electricity has been grow­ing at an average rate of 10 per cent per annum. The shortage has already assumed the proportion of a crisis and the country has virtually fallen in a ‘energy trap’. This requires huge investment in the energy sector and liberalised policy to attract foreign inves­tors.

There is gross inefficiency in the generation, distribution and consumption of power in the coun­try. The average plant load factor of thermal plants, the major contributors (70%) of power supply re­mains below 60%. It varies from 65% in Rajasthan to just 21% in Bihar. The transmission and distribu­tion losses amount to almost one-fourth (22.9%).

The electricity boards of the states responsible for distribution of electricity incur heavy losses and are deep in debt, unable to pay the NTPC the price of power in time. The higher rate of energy intensity in comparison to developed countries in industry, trans­port and agricultural sectors is also a matter of great concern.

There is also uneven spatial distribution of power in the country. About 69% of power genera­tion is accounted for by 14 major states. One-fifth of the entire installed capacity and power generation is concentrated in two western states of Maharashtra and Gujarat. Together with Madhya Pradesh the western grid contributes one-fourth of the installed capacity and one-third of the total power generation of the country.

The southern grid covering four southern states of Andhra Pradesh, Tamil Nadu, Karnataka and Kerala accounts for about 17% of the installed capacity and one-fourth of the power gen­eration. The northern grid comprising Uttar Pradesh, Rajasthan, Haryana, Punjab, Himachal Pradesh, Jammu-Kashmir, Uttaranchal and Delhi shares only 18.5% of the installed capacity but 25% of the total power generation (U.P. about 15%). The eastern grid covering four states of Bihar, Jharkhand, West Bengal and Orissa has only 10% of the installed capacity and 8% of the power generation (in the state sector).

Although substantial portion of the central sector super thermal power plants are located in this belt, the region is power starved. The installed ca­pacity and power generation are quite insignificant in the north-eastern states. Assam has as much installed capacity (557 mw) as Delhi (552 mw) but the ratio of power generation between the two is 1 : 6.

It is also significant that while in the northern, western and southern grids there is significant con­tribution of hydro and nuclear power, the eastern grid is exclusively dependent on thermal power and the north-eastern grid on primarily hydro power.

The western region leads in power generation owing to the industrial development in Maharashtra and Gujarat and availability of hydro power in the West­ern Ghats supplemented by nuclear power at Tarapur and Kakrapar. On the other hand coal rich states of Bihar, Madhya Pradesh, Orissa and West Bengal have attracted thermal plants in the central sector to meet the power needs of heavy industries.

The regional imbalance in the installed capacity and power generation is likely to persist for a long time in future because very little attempts are being made to improve the situation.