Related Topic in KAS Prelims Syllabus:
Economy [Paper-II]: Infrastructure in Indian Economy, Energy and Power
In partnership with NITI Aayog, International Energy Agency (IEA) today released the first in-depth review of India’s energy policies.
About the IEA Review
- The report highlights the achievements of India’s energy policies and provides recommendations to support the government’s goals of promoting well-functioning energy markets and boosting deployment of renewables.
- IEA regularly conducts in-depth reviews of energy policies for its member and association countries.
- This is the first review carried out for India, which has been an IEA-association country since March 2017.
- The report congratulated the Indian government on its outstanding achievements in extending citizens’ access to electricity, affordable efficient lighting and clean cooking in record time through historic schemes like SAUBHAGYA, UJALA and UJJWALA, while pursuing energy market reforms and the swift deployment of renewable technologies.
- The report highlights the strong growth of renewables in India, which now accounts for almost 23% of the country’s total installed capacity.
- The review also found that energy efficiency improvements in India avoided 15% of additional energy demand, oil and gas imports, and air pollution as well as 300 million tonnes of CO2 emissions between 2000 and 2018.
- India’s demand for energy is set to double by 2040, and its electricity demand may triple.
- Indian oil consumption is expected to grow faster than that of any other major economy. This makes further improving energy security a key priority for India’s economy.
- The report offers a wide range of recommendations for reforms in support of India’s goal of promoting open and well-functioning energy markets in sectors such as coal, gas and electricity.
- These include building strong regulators to ensure non-discriminatory access, moving from state allocation to market pricing, and further rationalizing energy subsidies.
- In India’s renewables-rich states, the share of variable renewables in electricity generation is already above 15%, a level that calls for dedicated policies to ensure they integrate smoothly into the power system.
- NITI Aayog can play a strong role in working with the states to implement power sector reforms, advance grid integration, improve flexibility and coordinate energy policy decisions.
- The review strongly encourages India to institutionalise energy policy coordination across government with a national energy policy framework.
- India’s oil demand growth is set to overtake China by mid-2020s, priming the country for more refinery investment but making it more vulnerable to supply disruption in the Middle East.
- India, which ranks No. 3 in terms of global oil consumption after China and the United States, imports over 80% of its oil needs, of which 65% is from the Middle East through the Strait of Hormuz. India is the world’s fourth-largest oil refiner.
[Source: PIB, Economic Times, iea.org]