Sashi Mukundan spoke at the launch of the India Energy Security Scenarios (IESS) 2047 Version 2.0 in New Delhi. He is Regional President of BP and Chairman of CII Hydrocarbons Committee.
Date: 27 August 2015
Vice Chairman - NITI Aayog, Dr. Arvind Panagaria; British Deputy High Commissioner to India - H.E. Dr. Alexander Evans; CEO, NITI Aayog - Smt. Sindhushree Khullar; Adviser (Energy), NITI Aayog - Shri Anil Jain, my friend Shri Y.K. Modi; distinguished guests, Today’s event marks another significant milestone in India’s evolving strategy for securing its energy future. As we all know, unhindered access to affordable energy and its efficient and sustainable use is perhaps the most significant developmental challenge facing the country. Having survived a number of supply disruptions over the last few years, and with continued focus on eradicating poverty and boosting economic growth, India today has a unique window of opportunity to take advantage of the current global economic environment – both in capital markets as well as commodity prices.
This initiative by the government to update the India Energy Security Scenarios is right on cue. This framework allows the government, companies, and think tanks to be able to assess alternative policy options and choices; identify the fault lines in our growth path; and quantify the possible impacts of outcomes. The quantum jumps in India’s energy needs – in all forms - over the next few decades will be directly related to economic growth and meeting the demands of its burgeoning population. The government’s initiatives of ‘Make in India’ and ‘Smart Cities’ only reinforce the need for greater access to affordable and efficient energy forms.
Let me take a moment to highlight the two considerable challenges that this Scenario brings out – which have been consistently flagged for India in the BP Energy Outlook. The first is our import dependency rising to well over 50% of our total energy requirement by 2030. To address this, especially in light of the Hon’ble Prime Minister’s target for reducing 10% imported energy by 2022, India’s hydrocarbon resources have to be developed to its full potential. Of course, we have to be realistic - these resources, while potentially significant, are in complex and difficult geographies which call for large investments, modern technologies, and intensive Exploration and Production activities. And to bring this triad into play requires the right policies which can unlock hydrocarbon reservoirs in deep and ultra-deep waters and can save billions of dollars in import bills. The second headline issue, especially as we approach the next COP21 discussions in Paris later this year, is of GHG emissions. As the Hon’ble Minister Shri Javadekar pointed out recently, India still ranks low in terms of per capita emissions and even in volume terms. BP Energy Outlook reports that India’s CO2 emissions from energy use were just 21% of the US emissions and less than 35% of total Chinese emissions in 2014. In per capita terms, this means an average Indian’s carbon footprint is just 5.4% compared to an average American and 38.3% to that of an average Chinese. However, given aspirations of rapid economic growth, the increase in GHG emissions from India are the largest. This unavoidable outcome of a higher development trajectory should not detract us from the need for faster growth. The emphasis should instead be on increasing the share of cleaner and more carbon efficient fuels. The Hon’ble Prime Minister has set a very ambitious target of 188 GW for renewable energy by 2022. An equally significant opportunity is available here by increasing the share of gas in India’s energy mix. A 1% switch from coal to gas is equivalent to adding 11% of renewables. In fact, from the data in BP Statistical Review of World Energy 2015, over the last decade, high gas consumption growth has led to the most significant improvements in India’s emissions intensity (GHG emissions from energy use per unit of GDP). Addressing these two challenges on a war footing will open up vast opportunities for rapid economic growth which in turn will translate into greater social development. Sustainable and efficient use of energy are the cornerstones of a modern and socially responsible industrial nation.
Delivering on the “Make in India” and “Smart Cities” policies call for India to move more aggressively in producing more of its energy in sustainable and carbon efficient forms.
The IESS, 2047, is an excellent tool for generating various models under different scenarios. I would like to take this opportunity to compliment and thank Niti Aayog in making available such a transparent and user friendly framework that provides to all of us – government, industry, think tanks, and members of the public – the means to comprehend what the nation must do. Shri Anil Jain and his team and all his partner institutions, and with insightful guidance from Mrs Khullar, must be commended for this incredible effort and for continuing this dialogue with all concerned stakeholders. Vice Chairman - NITI Aayog, Dr. Arvind Panagaria and Deputy High Commissioner Dr. Evans, your presence here is indicative of the recognition of the importance of sustainable energy, and climate change; and this initiative – also an important cooperation between India and Great Britain. A special thanks to FICCI for organizing this event. Finally, ladies and gentlemen, I look forward to all of us consciously using IESS 2047 to come up with viable solutions and not just let it remain another academic exercise. Thank you.