An integrated energy policy is imperative for growth

Academician, visionary entrepreneur, doctorate in Economics and Industrial Engineering all rolled into one is Dr R K Pachauri, Director General of The Energy & Research Institute (TERI). Even as he is busy trying to develop cheaper and user-friendly technologies for rural masses, he has a huge task in convincing not just the government, industry but also rural masses in picking up and inculcating ideas, products and concepts in the area of renewable and sustainable energy. Under Dr Pachauri?s leadership, TERI does original research and provides professional support in the areas of energy, environment, forestry, biotechnology, and conservation of natural resources to governments, institutions, and corporate organisations worldwide. Dr Pachauri discusses a variety of issues with Deccan Herald?s Aditya Raj Das. What is the significance of energy in development. How intricately is it linked to security concerns? Energy is one of the most important inputs for development. If we want growth and development then one cannot do without energy. Unfortunately, we have not focused on energy policy in an integrated sense. All?both public and private?associated with energy sector must work within a common framework for optimum utilisation of energy resources for the overall growth and development of the economy. As far as oil security is concerned it is alarming to think about our increasing dependence on oil imports. The bulk of the increase in the production of oil in the future will continue to come from a small handful of countries in the Middle East and that certainly is a security concern in terms of geopolitics. Global crude oil price is always prone to heightened volatility. Only recently oil prices went beyond $55 per barrel. So I think the security of the energy supply is an important part of defining this country?s energy policy. Do you think the government has a well-balanced policy on the fuelmix? The problem is not in formulating the policy but in making sure that it is implemented. So far, we really do not have a coherent energy policy. It is also important to structure the departments and the ministries dealing with energy sector in such a manner that allows the implementation of the energy policy in an integrated manner. There has to be some coordinating mechanism. At the moment you don?t have that. Each of these ministries/departments are now functioning within its own limited territories. Unless you have some common framework then you are not really taking about an integrated energy policy but about a power policy in isolation of petroleum policy, or in violation of coal policy and the result is that the country suffers. You are the catalyst behind the Iran-India Gas Pipeline project. Why do you believe that the energy security in the South Asian region will be bolstered significantly because of this project? There are several reasons. Firstly, Iran has a large reserve of natural gas in its southern region. They can?t possibly sell that quantity to Europe. There is no market for it there. On the other hand, if you look at South Asia and India, in particular, we have an increasing demand for energy. Natural gas is clean fuel. It allows you to convert energy into electricity in a very efficient manner. The other advantage is that you can minimise pollution. If we can meet most of our energy demand from gas it will give us a certain level of comfort in overall energy picture. We can buy time say 20-30 years within which we can hopefully develop technologies for generating renewable forms of energy. From security angle do you think it will be feasible? I think it is. Because if Pakistan is getting transit payment for allowing this pipeline it will be morally bound to provide security for the pipeline. We can also enter into some kind of arrangements. For instance, we can supply diesel to Pakistan in return for uninterrupted supply of gas. Then Pakistan will have a stake in ensuring that we get uninterrupted supply. What about laying the pipeline under the sea? It will be a very expensive proposition. The technology is still not proven. There is a greater risk of some terrorists blowing up the pipeline. If it will be an on-land pipe-line project Pakistan will be squarely responsible for ensuring security of supply. Also the Iranians have indicated that they will charge us for the gas to be delivered at our border. This means they are willing to take some of risk. It is being projected that country?s oil import dependency will go upto 94 per cent by 2030. What is the way out? We have been active for the last 20 years in trying to sensitise the government to some of these alarming realities. We have no other choice than to go for alternative fuel. We need to promote an infrastructure that is low in terms of consumption of energy. Look at our transport situation. It is absolutely hopeless. The railways are losing traffic to road transport sector. Instead of public transport in our cities we are moving towards proliferation of private vehicles. This is really not desirable for a country like ours. The auto industry would want everyone to own cars. Where do you draw a line? This is a very dangerous trend. Because we have allowed all the major automobile giants to set up facilities in India. We have had some benefits. We got good technologies. Our cars are much better now than they use to be, but the fact is that we have created a vested interest. The automobile manufacturers will not allow an efficient public transport system to grow. Why is this not dawning on the government? You see, pardon my saying so, our government seems to be ?knowledge proof?. You go to any country in the world there is some respect for knowledge. Our government system is totally immune to any ideas coming from the outside. It is a case of status quo and you balance it. Has the opening up of the economy facilitated in throwing up more opportunities for entrepreneurs who want to work in power sector? You see, we have not really carried out appropriate reform in the energy sector. Look at the state electricity boards, they are still in a state of difficulty. We have not been able to bring about a proper privatisation of distribution facilities. We have not been able to attract private sector in setting up independent power plants. Even, the regulatory bodies that we have set up, by and large they have not been very effective. Unless we carry out the reforms of the energy sector, unless we make it reasonably attractive for the private sector to come in, we are not going to be able to solve this problem. Is India Inc serious about its environmental responsibilities? They are getting more and more serious. There are some examples of extremely responsible companies that have done a great deal to improve the environment. I think the problem is with the medium and small companies. They do not have the expertise, resources and by and large they don?t even have the desire to improve their environmental performance. But the larger units are getting cautious, because the public pressure is more on them. I think that even in terms of business it is getting important that you are a good corporate citizen and not merely making profits and polluting the environment. So I would say that the trend is in the right direction.