Gas - the Bridge to a Cleaner Greener India!

Vinod Tahiliani, Area Planning Commercial Manager at BP India shares his insights on the Indian and global energy industry, highlighting gas as the bridge fuel
Date: 5 August 2016
The world GDP is expected to roughly double over the next 20 years. China and India together would account for almost half this increase. To fuel this surge, the demand for energy would grow by around a third- from just under 13 trillion tonnes of oil equivalent (toe) to over 17 trillion toe. And most of this growth will be in fast-growing emerging economies like India. 

With the focus on the environment, renewables are likely to be the fastest growing fuel source globally and in India. However, fossil fuels will continue to remain the dominant source of energy.  The global fuel mix is expected to see a shift away from coal to gas as a cleaner fossil fuel, aided by ample gas supplies and strengthening environmental policies. Globally, gas is expected to overtake coal as the second largest fuel source by 2030.  Comparatively, the energy mix in India evolves very slowly with coal continuing to be king and Gas with a low share of 8% in the energy mix.
Globally, Gas supply is increasing from both conventional production and shale gas - with Liquefied Natural Gas (LNG) supplies expected to more than double over the next 20 years. Several under construction projects are on track to be completed over the next 5 years which roughly equates to a new LNG train coming on stream every 9 weeks causing LNG to surpass pipeline gas as the dominant form of traded gas.  This will transform international gas trade as LNG can respond to price signals more quickly and act like a glue, bringing a balance to regional gas prices and markets that would increasingly integrate over time.

There is greater potential in India for discovering gas resources than oil. India already has significant undeveloped discovered gas resources which could double India’s current gas production by 2022.

The Government has encouraged domestic gas production through the recent gas pricing policy and other reforms.
Domestically produced gas will play a critical role in achieving Prime Minister’s vision of reducing 10% energy dependence on imports by 2022. Affordable LNG supplies can augment this domestic supply.
  • This makes one believe that Gas can bridge the energy gap as India transitions to affordable clean energy:
  • Gas is the cleanest fossil fuel - 50% of the CO2 emissions of coal per unit of power. 1% switch from coal to gas is equivalent to adding 10% of renewables.
  • Even at market prices, gas is less expensive than oil and oil products.
  • Gas based power is a good balancing fuel to renewables.
  • To enable this to happen, the Government is developing a gas road map and investing in gas infrastructure such as a national gas grid which can help India fuel smart cities, industrial and energy corridors, expressways and high speed transportation - much like the telecom revolution that vaulted Indians from landlines to high speed mobile telephony and data transmission in just a decade.