DMPQ- Discuss the major features of Integrated energy policy of India.

. Besides the huge resources required there are structural issues like, one of the highest  Aggregate Transmission and Distribution (AT&D) losses of 25 per cent the highest in the  world. There are other issues like power thefts which along with distribution losses result  in losses to the State Electricity Boards (SEBs), under pricing, mounting losses of the State  Electricity Boards and concept of free power.

The Policy has mentioned dependence on coal based thermal energy. ‘Coal’ would the  ‘primary source of energy accounting for 60 per cent even by 2031-32 and thermal power  generation alone accounting for 47 per cent. The proven reserves are not an issue for the  present, but quality  a matter of concern. Our present coal reserves are not that which is required in the power plants.

The other issue around coal is complete monopoly of Government in mining and thus  the policy favoured reforms in the coal sector opening to private and foreign participation, pricing to be market determined so that scarcity value of coal gets reflected and there is optimization and efficient use. There was a need to step up ‘coal forecasting’ as it is widely  believed that ‘coal potential’ in India is over 100 years.

The other source to meet the energy requirement is petroleum which would account  for 25 per cent. But the problem here is that it is also non renewable. Besides there is  heavy import dependence of presently 70 per cent which is likely to go up to 90 per cent  by 2030 making India the third largest importer of crude petroleum after US and China.  This would make the economy extremely vulnerable to global price fluctuations besides  supply factors in the wake of adverse developments in West Asia.

There is an urgent need to free up pricing of retail petroleum goods in the domestic  market so that their scarcity value gets reflected. The government should spread awareness  on the need for energy conservation, increasing energy efficiency and lowering energy  intensity. There was a need to step up efforts at developing viable alternatives to the  growing dependence on oil through R & D. The government should set up a National  Energy Fund by levying a cess of 1 per cent on turnover of all companies in the energy  sector. Many countries in Europe have already announced a zero dependence on crude  petroleum in a given time frame. India needs to do the same. Given the volatility in the  international crude petroleum prices the policy has suggested creating strategic reserves of  crude petroleum of at least 90 days.

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