India's Energy Policy

This year I would like to focus on writing about the importance of India's energy security. While India remains in the midst of a productivity revolution, it is handicapped by power shortages and an unreliable grid. There are many things India can do to focus on energy security. Here are some key points:

Energy Conservation is key: Energy saved is much cheaper than energy generated from renewable resources (to add a kW costs 3 times more than to reduce a kW of consumption roughly). Refrigerator standards implemented in the US have saved more energy than all renewable sources can generate in a year. This amounts to annual savings of $16B in the US.

• Energy Policy is the most effective and cost efficient way to implement energy efficiency through residential, commercial and industrial sectors of the economy. Such a policy may include mandates on electricity consumption standards required of products (see table below)
• Also for example, there is a major initiative underway between Lawrence Berkeley National Labs (UC Berkeley) and the Government of India called - BIJLEE (Berkeley-India Joint Leadership on Energy and the Environment) is for Energy Efficiency and Renewable Energy. Two MoUs have been signed between the state of CA and the MSEB (Maharashtra State Electricity Board) and City of Delhi to transfer knowhow on policies and technologies for energy efficiency. A list of best practices can be developed from these joint efforts that all states and electricity boards should adopt and implement as soon as feasible.

• Technology Improvements: Energy using technologies may be categorized into two types. One category is of technologies that are mass produced such as lamps, refrigerators, motors, air conditioners, drives, etc. The second category is of technologies that form part of larger industrial processes such as in the production of steel or cement, which are more likely to be one-of-a-kind. The cost effectiveness of an energy efficient technology may be estimated by calculating its cost of conserved energy (CCE). The CCE provides a measure that is directly comparable to the cost or price of energy supply. Numerous studies worldwide have shown that the cost of conserved energy is lower than the cost of production and supply for a majority of the energy efficient technologies. See the table below which shows the cost-effective energy efficiency potential for four products in India. It shows that among these products refrigerators and distribution transformers exhibit the highest potential for improving energy efficiency. In the industrial sector, in addition to efficient motors, lighting and air conditioning systems, and variable speed drives are increasingly being utilized. These are cost effective in many applications.
• Electricity Grid: India needs to have a decent grid first, before making it smarter. As India invests more in energy generation using either renewable or fossil fuels, it will have to invest in a grid. This is major priority even if an expensive item of infrastructure development. This alone will help electricity starved industries and the efficiency of distribution is as important as generation of energy.