NEW DELHI: Energy will continue to be a top priority for the government in the coming months as India scrambles to increase access to its more and diversified sources.
In the immediate future, the government is likely to concentrate on a few things. First, the government's new investment committee will be asked to take a decision on exploration in gas blocks that had been held up due to defence and space departments' objections. Second, push the US government to allow more shale gas exports to India. Third, India will continue to focus on coal, and countries like Australia and Indonesia will become more important as India imports more coal for power generation than the current imports of largely coking coal.
The government is looking at unfreezing exploration projects in over 11 onshore and offshore gas blocks — these have been held up due to objections by the Navy, IAF, DRDO and the department of space. "Either it is a practice area, or in the flight path of missile tests ... other countries have overcome these clearance hurdles, we should be able to do so," said officials involved in the decision. Since these decisions cannot be taken at the official level, the newly-formed cabinet committee will be tasked with clearing these projects so major foreign companies don't exit the exploration sector.
US' shale gas exports to India are a priority for the government. With the US heading to becoming a global leader in shale gas, India wants to be one of the bigger importers (South Korea is the largest importer of the gas). This is a slightly tricky process, made difficult by the fact that India is not US' FTA partner. The US' department of energy has recently published an internal study of the impact gas sales would have on American domestic energy sector. This study will influence the Congress's decision to open up gas exports to India as being in national interest.
The decision will not be easy: chemical industries and companies returning manufacturing to the US by taking advantage of low prices are likely to oppose exports on the grounds that this might raise gas prices internally.
Coal will remain India's primary energy source for power. Therefore, Australia and Indonesia are likely to become more important as energy suppliers for India. In a new study, Worldwatch Institute says, though oil remains the world's leading energy source, coal and natural gas continue to grow in significance. The study says, "spurred mainly by rising demand in China and India, coal's share in the global primary energy mix reached 28% in 2011— its highest point since 1971."
The study goes on, "China alone accounted for nearly half of all coal use in 2011. India is the second largest contributor to rising coal demand and is the world's third largest coal consumer, after surpassing the European Union in 2009. The United States remains the second largest coal user, even though the US' demand decreased by around 5% in 2011 and continued to fall in 2012 due to the shale gas boom and the abundance of cheap natural gas."
Tapping diverse energy sources remains govt’s top priority
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Tapping diverse energy sources remains govt’s top priority
