India’s Energy Policy in the Indo-Pacific Region

India’s energy policy is strongly influenced by the country’s past, with self-sufficiency and energy independence being given high priority.

India’s past is India’s future, you might say. On the Indian subcontinent there is a millennia-old tradition that essentially influences the modern actions of the energy industry. India in particular cultivates a culture of self-sufficiency due to its diverse past and the conquests that Indians endured. With regard to the energy industry, an interesting structure is emerging in which the energy industry is modernizing. Particularily the cconstruction of nuclear power plants is gaining momentum. But India is still looking to simple solutions from the past.

In India, the use of biomass and biogas is of enormous importance for the energy industry. It was biogas and biomass that has allowed regionally scattered farmers and small settlements on the Indian subcontinent to meet their own energy needs. In particular, biogas has helped local farmers to meet their electricity needs, without which they would not have any fuel to heat their cooking stoves. India, in contrast to many other developing countries, has a sophisticated strategy in this respect.


Biomass is viewed by the government and the population as a relatively cheap alternative to more complex energy solutions. We can see a growing use of biomass in rural communities in India.

It is often forgotten that India is still primarily an agricultural country based on the self-sufficiency of the population. The majority of the Indian population continues to work in agriculture. This results in a twofold division of the energy supply, so to speak. On the one hand, we see that the Indian government wants to ensure that there is enough energy available in rural regions, which means the government must ensure that energy is  available throughout the year and remains affordable. On the other hand, the government creates new energy solutions in urban areas to meet growing demand. I believe the Indian government should not fall back on simple energy solutions in cities.

The Indian government has set itself the goal of installing solar systems on roof tops so that people can produce their own electricity, to reduce their reliance on the electricity grid. The Indian government is well aware that renewable energy still plays a subordinate role in the country’s energy supply. The largest part of the electricity supply is made up of fossil fuels, especially oil and coal. For India, it makes a lot of sense to use the remaining fossil fuel reserves. India still has its own coal reserves, but India’s coal reserves are becoming increasingly scarce.

What we can see is that the share of renewable energy as a fraction of the country’s total electricity supply is steadily increasing, and wind and solar energy is growing fast. Some of the largest solar parks in the world are in India, and the goal is to use the favorable conditions of solar energy in areas such as Rajasthan to generate electricity and increase the share of renewable energy in the country’s electricity production. However, it will take another 5 to 10 years for the share of renewable energy to have a significant impact on the country’s electricity production.

The Indian government is hopeful that solar energy will continue to grow and contribute to primary energy consumption.  Solar energy, in particular, has now reached grid parity with fossil fuels. Grid parity is the point at which electricity generated from photovoltaic installations is comparable in terms of $/KWh with fossil fuels. However, one has to consider that the logistics costs for production, construction and operation are often not taken into account and in certain regions of India solar energy is certainly not yet competitive and still takes time to compete with fossil fuels on a $/KWh basis.

The Indian government believes that with decentralized energy plants, some of which operate independently of the national power supply, renewable energies will make a significant contribution to energy security. In India, the problem with renewable energy is how to scale it and mass produce it  cheaply, and a how to interconnect the various components of the energy system nationwide.

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An equally important element of Indian energy policy is the introduction of advanced metering systems to optimize power grids.

An increasingly important goal for the Indian government is the development and operation of advanced metering systems in India, especially smart meters, as part of a nationwide smart grid, enabling India to control and influence the various power flows. Here we are currently learning from the experience of Western countries that have early experience in Smart Grid and Smart Metering.


The conflict with Pakistan could jeopardize India’s economic development in the long term, as it restricts the civilian use of nuclear energy.

Due to geopolitical tensions between India and Pakistan over control of the Kashmir region, India does not rule out the military use of nuclear energy. India has also not signed the Nuclear Non-Proliferation Treaty. In the end, however, this also means that India, precisely because of the civilian use of nuclear energy, is stirring up fears that uranium imports will find a military use. This is a risk factor and an example of how military and energy policy measures are intertwined.


Future outlook: Solar power will be a key element of India’s future energy supply, but solar power will not be able to replace fossil fuels for the foreseeable future.

Solar power is likely to become an important part of ensuring India’s energy security in the long term, as India’s geographic location makes the civilian use of nuclear energy a  security risk. The use of nuclear power means that India is exposed to geopolitical risks. A large part of the uranium is mined in Australia, Russia and the USA. This is inherently risky, because India depends on other countries for energy resources, which is exactly what India wants to avoid.


References:

Asian Power, Renewable energy jumped to 16% of India’s energy mix, 2017, available at: https://asian-power.com/project/exclusive/renewable-energy-jumped-16-indias-energy-mix

BP Energy Outlook Country Insight India, 2018, available at: https://www.bp.com/content/dam/bp/en/corporate/pdf/energy-economics/energy-outlook/bp-energy-outlook-2018-country-insight-india.pdf

Devangshu Datta, Scroll.In: As geopolitics over crude intensifies, energy-dependent India could be in for an oil shock, 2018: https://scroll.in/article/898886/as-geopolitics-over-crude-intensifies-energy-dependent-india-could-be-in-for-an-oil-shock

James Bowen, Future Directions international, The Complex Geopolitics of India’s Growing Energy Needs, 2018, available at: http://www.futuredirections.org.au/publication/the-complex-geopolitics-of-indias-growing-energy-needs/

Rajiv Sikri, Institute of South Asian Studies: The Geopolitics of Energy Security and Implications for South and SouthEast Asia, 2008, available at: https://www.isas.nus.edu.sg/wp-content/uploads/media/isas_papers/37_WP.pdf

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