Table of Contents

Foreword by Harry Brekelmans, Jamshyd N Godrej and Ajay Mathur
Preface
Acknowledgements
Overview
Four impending transitions
India’s energy aspirations
India’s energy choices
Coal, gas and renewables in the primary energy mix
Which transport fuels can India depend on for its growing mobility needs?
A “no-regret” strategy for infrastructure
Articulating a technology trajectory under uncertainty
An integrated energy pricing regime sensitive to the needs of India’s energy-poor
Aligning energy pricing with policy objectives
Relying on overseas assets or global energy markets to deal with volatility in global energy prices
An integrated policy environment
INDIA’S ENERGY FUTURE
On an energy-intensive industrialization pathway
Climbing the energy ladder
Increased role for renewables
Importing fossil fuels: essential for an industrializing India
Transportation for a growing population
Energy for an urbanizing India
Reducing energy poverty with cleaner fuels
Preparing for a decarbonizing world
Conclusions
INFRASTRUCTURE FOR AN INTEGRATED ENERGY SYSTEM
Energy consumption and the infrastructure required
Infrastructure and lock-in
Regulating India’s future energy infrastructure
Laws
Regulating energy infrastructure through contracts
Putting together the pieces
Coal
Natural gas
Renewables
Domestic manufacturing and research and development
Soft infrastructure
Building human capabilities
Financing
Conclusions
TECHNOLOGY FOR A PRODUCTIVE ENERGY SYSTEM
Key technologies required for India’s energy system
Coal reserves and production
Oil and gas reserves and production
Conversion technologies
Transmission and distribution
Demand technologies
Conclusions
PRICING FOR AN EFFICIENT ENERGY SYSTEM
Why is efficient pricing important?
India a market in transition—the need for efficient energy markets
Efficiency pricing to integrate domestic and international energy supply
Coal pricing in India
Gas pricing
Electricity pricing
Raising energy prices (as only one means) to ensure investment
Managing the transition to higher prices
Reforming energy subsidies
Moving to renewables
Energy conservation and innovative pricing
Taxation
Upstream hydrocarbon taxation
INDIA IN GLOBAL ENERGY MARKETS
Seeking energy security, not energy independence
Understanding energy security
Evolving definitions of energy security—more than quantities and prices
Energy security for India
Seeking assured supply
Public, private or both?
Lagging far behind China
An effective strategy?
Seeking safe passage
Ownership of tankers
Cooperating over security threats?
Seeking secure storage
Adequate storage?
Is additional storage the only way?
What institutional best practices?
Seeking international cooperation
Little capacity to be involved in multiple forums
Choosing functional institutions
Conclusions
POLITICS AND POLICIES FOR A RESILIENT AND EQUITABLE ENERGY SYSTEM
The need for stable and consistent policies
The licensing regime for exploring hydrocarbons
Rationing domestic national gas
Coal mining
The need for an integrated policy environment
Linking supply to demand
Ensuring energy access
Generating thermal power
Strengthening institutional links
Moving to independent regulation
Conclusion

About the Author

Suman Bery is Chief Economist, Shell International, based in The Hague, Netherlands. He assumed this position on 1 February 2012.

Mr Bery served as Director-General (Chief Executive) of the National Council of Applied Economic Research (NCAER), New Delhi, from January 2001 to March 2011. NCAER is one of India’s leading independent policy research institutions. He then served as Country Director-India Central, the International Growth Centre (IGC). The IGC is a research initiative of UK Aid in partnership with the London School of Economics and the University of Oxford. In this capacity he was responsible for setting up the IGC’s New Delhi office in partnership with the Indian Statistical Institute’s Delhi centre.

Prior to NCAER, Mr Bery was with the World Bank in Washington, D.C. From 1992 to 1994, on leave from the World Bank, Mr Bery worked as Special Consultant to the Reserve Bank of India, Bombay, where he advised the Governor and Deputy Governors on financial sector policy, institutional reform, and market development and regulation.

Mr Bery completed his undergraduate work at Magdalen College, University of Oxford in Philosophy, Politics and Economics and holds a Master of Public Affairs (MPA) degree from the Woodrow Wilson School of Public and International Affairs, Princeton University. Arunabha Ghosh, PhD, has been CEO of the Council on Energy, Environment and Water (CEEW) since its founding in August 2010. CEEW has been consistently ranked (third year running) as South Asia’s leading policy research institution across several categories. With work experience in 37 countries and having previously worked at Princeton, Oxford, UNDP (New York) and WTO (Geneva), co-author of four books and dozens of research papers and reports, Arunabha advises governments, industry, civil society and international organizations around the world. He is a World Economic Forum Young Global Leader, Asia Society’s Asia 21 Young Leader, and fellow of the Aspen Global Leadership Network.

Dr Ghosh was invited by the Government of France as a Personnalité d’Avenir to advise on the COP21 climate negotiations. He has been actively involved, since inception, in developing the strategy for and supporting activities related to the International Solar Alliance, which was launched by the governments of India and France in November 2015. He serves on the Executive Committee of the India-U.S. PACEsetter Fund, which invests in promising decentralized energy solutions. He has presented to heads of state and legislatures across the world; and is a member of Track II dialogues with seven countries.

Arunabha’s co-authored essay “Rethink India’s energy strategy” in Nature, the world’s most cited scientific journal, was selected as one of 2015’s 10 most influential essays. Widely published, he is most recently a co-author of Climate Change: A Risk Assessment (2015) and Human Development and Global Institutions (Routledge, 2016). Another forthcoming book is The Palgrave Handbook of the International Political Economy of Energy (2016). He has been an author of three UNDP Human Development Reports. He writes a monthly column in the Business Standard, and has hosted a documentary on water in Africa and one on energy in India.

Dr Ghosh is a founding board member of the Clean Energy Access Network (CLEAN) and is a board member of the International Centre for Trade & Sustainable Development, Geneva. He holds a doctorate from the University of Oxford (Clarendon Scholar; Marvin Bower Scholar), an M.A. (First Class) in Philosophy, Politics and Economics (Balliol College, Oxford; Radhakrishnan Scholar); and topped Economics from St. Stephen’s College, Delhi. Ritu Mathur, PhD, has been leading the Energy Policy Modelling and Scenario Building activities at TERI over the last two decades and is currently also associated with TERI University as Professor in the Department of Energy and Environment.

An economist by training and with a PhD in Energy Science from Kyoto University, Japan, her work largely focuses on addressing policy and regulatory aspects related to the energy sector, examining the potentials and challenges to cleaner energy choices while addressing energy security and development-related considerations of developing countries, cost–benefit analysis and evaluation of synergies and trade-offs of alternative technological and policy pathways, etc.

She has led several national and international interdisciplinary projects and has authored several papers, reports and books related with energy use and its implications on the environment at the local and global levels in order to inform and influence various stakeholders in decision-making.

Dr Mathur has been associated as a member of several committees including the Expert Group on Low Carbon Strategies for Inclusive Growth, Steering Committee on Energy Sector for India’s Five Year Plans, Sustainable Growth Working Group of the U.S.-India Energy Dialogue led by NITI Aayog (formerly Planning Commission of India), etc. She was also a Lead Author in Working Group III of the IPCC Fifth Assessment Report, and a Reviewer in IPCC AR4. Subrata Basu is Consultant in Finance and Strategy team of Shell based in Bengaluru. He has been working in various energy sector companies in India and with Shell for the last 5 years. His areas of interest include energy sector policies, new technology development in the energy sector, energy market strategies for organizations, etc. He has previously worked with organizations such as Larsen & Tubro and PwC in various operational and strategic roles. He has contributed to international and national journals and conferences. In Shell, his current role includes international policy review, internal business and investment planning. He enjoys travelling, music and sports. Karthik Ganesan is a Senior Research Associate at the Council on Energy, Environment and Water (CEEW), India. As a member of the team at CEEW his research focus includes the development of long-term energy scenarios for India (based on an in-house cost-optimization model) and energy efficiency improvements in the industrial sector in India. Linked to his work in industrial efficiency is his role as the principal investigator in an effort to identify critical mineral resources required for India’s manufacturing sector. He also leads a civil society effort to assess greenhouse gas emissions from the industrial sector to understand the contribution of the sector to national emissions inventory. In addition, he supports ongoing work in the areas of energy access indicators for rural Indian households and carried out a first-of-a-kind evaluation of the impact of industrial policies on the renewable energy sector in India. Prior to his association with CEEW, he has worked on an array of projects in collaboration with various international institutions, with a focus on low-carbon development and energy security.

His published (and under review) works include Rethink India’s Energy Strategy (Nature, Comment); The Co-location Opportunities for Renewable Energy and Agriculture in North-western India: Trade-offs and Synergies (Applied Energy, American Geophysical Union); Valuation of Health Impact of Air Pollution from Thermal Power Plants (ADB); Technical Feasibility of Metropolitan Siting of Nuclear Power Plants (NUS) and Prospects for Carbon Capture and Storage in SE Asia (ADB). His role as a research assistant at a graduate level focused on the linkages between electricity consumption and sectoral economic growth using a time-series approach.

Karthik has a Master of Public Policy from the Lee Kuan Yew School of Public Policy at the National University of Singapore (NUS). His prior educational training resulted in an MTech in Infrastructure Engineering and a BTech in Civil Engineering from the Indian Institute of Technology Madras. Rhodri Owen-Jones is an Energy Analyst in Corporate Strategy and Planning, having joined Shell in 2008. In his current position, Rhodri is heavily involved in the quantification and modelling of the Shell New Lens Scenarios, as well as communicating the resulting work to a wider global audience. His work also includes modelling global long-term energy supply and demand, analysing and advising senior leadership on short-term oil and gas market developments as well as managing a joint research project on future Indian energy pathways. He is also Business Advisor to the Executive Vice President of Strategy in the RDS Group. Rhodri has previously worked in Production Engineering at NAM BV as well as coordinating and running a Europe-wide benchmarking exercise of Shell’s European assets. He holds a Masters in Mechanical Engineering having graduated from the University of Bath in 2008 with first-class honours.

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This book will start a public debate towards developing long-term sustainable policies to strengthen the Indian energy sector. -- Suresh Prabhu Minister of Railways