For India, the world’s third largest consumer and importer of oil after China and the United States, the stress on self-reliance in the energy sector stems from both environmental and cost concerns.
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New Delhi: Prime Minister Narendra Modi on Monday (August 15) once again stressed the need to be ‘Aatmanirbhar’ (self-reliant) in the energy sector. Addressing the nation from the ramparts of the Red Fort on the occasion of 75 years of Independence, PM Modi said from solar energy and biofuels to the adoption of electric vehicles, India needs to “reach the next level of energy independence”.
For India, the world’s third largest consumer and importer of oil after China and the United States, the stress on self-reliance in the energy sector stems from both environmental and cost concerns. The country’s oil import bill was a whopping $119.2 bn in 2021-22, nearly double of $62.2 bn the previous fiscal year, according to data from the oil ministry’s Petroleum Planning & Analysis Cell (PPAC). And the Russian invasion of Ukraine has only pushed up oil prices further.
According to PPAC, India imported 212.2 million tonnes (MT) of crude oil in 2021-22, up from 196.5 MT the previous year. It also spent $11.9 bn on the import of LNG in 2021-22, up from $7.9 bn the previous fiscal.
India depends on imports for around 85 per cent of its crude oil needs, mostly met by Gulf countries such as Iraq, Saudi Arabia, and UAE. Its import dependence has increased owing to a steady decline in domestic output. The country produced 32.2 MT of crude oil in 2019-20, which fell to 30.5 MT the following year and to 29.7 MT in FY22, the PPAC data showed.
In his I-Day speech, PM Modi emphasised that by 2030, India would cut greenhouse gas emissions by 45 per cent of what it was in 2005.
In fact, the NITI Aayog has earlier forecast that by 2030, nearly 80 per cent of two- and three-wheelers, 30-70 per cent of cars and 40 per cent of buses will run on electricity. India’s transition to the electric mobility system can save Rs 20 lakh crore by 2030 on oil imports alone.
India’s energy requirements
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According to the Central Electricity Authority (CEA), India has a total power generation capacity of 403,760 MW, of which almost half is met by the private sector. The country is hugely dependent on fossil fuels, with coal plants alone accounting for over half of India’s power generation capacity. Among renewable energy sources, solar accounts for 14.3 per cent, hydro 11.6 per cent and wind 10.1 per cent. Nuclear energy accounts for less than 2 per cent of India’s power generation capacity.
Total power generation in India and annual growth
| Year | Total generation (billion units) | %-age growth |
|---|---|---|
| 2011-12 | 928.11 | 9.14 |
| 2012-13 | 969.51 | 4.46 |
| 2013-14 | 1020.20 | 5.23 |
| 2014-15 | 1110.39 | 8.84 |
| 2015-16 | 1173.60 | 5.69 |
| 2016-17 | 1241.69 | 5.80 |
| 2017-18 | 1308.15 | 5.35 |
| 2018-19 | 1376.10 | 5.19 |
| 2019-20 | 1389.10 | 0.95 |
| 2020-21 | 1381.83 | −2.49 |
| 2021-22 | 1491.86 | 7.96 |
Domestic power generation, however, has grown by leaps and bounds – from 928 billion units (BU) in 2011-12 to 1,492 BU in 2021-22.
The power deficit has also decreased from 8.5 per cent to 0.4 per cent in the same period.
Apart from growing industrialisation and urbanisation, the Centre’s push for electrification and LPG connection in the remotest corners of the country has also led to increased demand for power.
Power supply in India
| Year | Requirement | Availability | Deficit | Deficit |
|---|---|---|---|---|
| (MU) | (MU) | (MU) | (%) | |
| 2011-12 | 9,37,199 | 8,57,886 | −79,313 | −8.5 |
| 2012-13 | 9,95,557 | 9,08,652 | −86,905 | −8.7 |
| 2013-14 | 10,02,257 | 9,59,829 | −42,428 | −4.2 |
| 2014-15 | 10,68,923 | 10,30,785 | −38,138 | −3.6 |
| 2015-16 | 11,14,408 | 10,90,850 | −23,558 | −2.1 |
| 2016-17 | 11,42,929 | 11,35,334 | −7,595 | −0.7 |
| 2017-18 | 12,13,326 | 12,04,697 | −8,629 | −0.7 |
| 2018-19 | 12,74,595 | 12,67,526 | −7,070 | −0.6 |
| 2019-20 | 12,91,010 | 12,84,444 | −6,566 | −0.5 |
| 2020-21 | 12,75,534 | 12,70,663 | −4,871 | −0.4 |
| 2021-22 | 13,79,812 | 13,74,024 | −5,787 | −0.4 |
According to the International Energy Agency (IEA), over 80 per cent of India’s energy needs are met by three fuels – coal, oil and solid biomass. However, India is pushing through a massive clean energy drive and has committed to 50 per cent energy share from non-fossil fuels and a 500 GW renewable energy capacity before 2030. The renewable energy target will comprise 450 GW from solar and wind, and 70-100 GW from hydropower plants.
At the COP26 Climate Conference in Glasgow in November last year, PM Modi pledged that India will achieve net zero carbon emissions by 2070.
The Electricity Amendment Bill
The Union government recently introduced the Electricity Amendment Bill 2022 that aims to allow privatisation of electricity on the lines of telecommunication, which, according to the Centre, can create a steady power supply across the country. This will grant open and non-discriminatory access to the distribution network, allowing private companies to supply electricity.
The Centre believes this will enable competition and enhance the efficiency of power supply across the country. Under the Electricity Amendment Bill 2022, power consumers will be able to choose from among multiple electricity providers, much like choosing between Airtel, Vodafone, and other telecom service providers.
