Challenges in India’s current energy policy

Source: The post Challenges in India’s current energy policy has been created, based on the article “Why the old script can’t work for India’s green transition” published in “Indian express” on 3rd June 2024.

UPSC Syllabus Topic: GS Paper 3-economy-infrastructure-energy

Context: The article discusses the need for India to update its energy policy to better manage fossil fuels and boost renewable energy, while also considering global competition and security concerns, especially with China’s dominance in green technology and supply chains. Challenges in India’s current energy policy

For detailed information on India’s Energy Policy read this article here

What is the current energy policy in India?

1. India’s energy policy is dual-pronged, focusing on both fossil fuels and renewable energy.
2. The fossil fuel strategy emphasizes reducing import dependency on petroleum through diversified import sources, strategic reserves, domestic exploration, demand conservation, efficiency, and environmental protection.
3. The renewable strategy is aimed at accelerating the shift to clean energy, with a long-term goal of net-zero carbon emissions by 2070 and a medium-term target of generating 500 GW from non-fossil fuels by 2030.

What are the challenges in the current structure?

1. The current structure of India’s energy policy is highly compartmentalized, with each ministry operating within narrow and rigid boundaries.
2. The existing setup involves multiple ministries such as Petroleum, Coal, Renewables, Power, Heavy Industry, Mines and Minerals, IT, Information, and Environment, making coordination and streamlined decision-making challenging.
3. There is no formal executive forum for integrated discussions on energy policy. This hampers India’s ability to meet its publicly announced decarbonization and sustainability targets.

What global dynamics influence India’s energy policy?

1. The resurgence of great power competition, reminiscent of a new Cold War between the US and its allies against China and Russia, influences India’s energy policy.
2. China’s near monopoly on essential materials for green energy and its dominance in producing low-cost solar wafers and wind turbines affect India’s strategies.
3. The geopolitical tensions and supply chain vulnerabilities impact India’s approach to securing and diversifying its energy sources.
4. National security concerns regarding the dependency on Chinese supplies have led India to impose duties on Chinese imports and promote domestic manufacturing through incentives like the Production Linked Incentive (PLI) scheme.

What should the next government do?

1. The next government should develop a strategic framework that integrates fossil fuels and renewable energy policies into a unified approach.
2. It should prepare a strategic document titled “Energy strategy: Towards convergence, security, and sustainability” to guide policy integration.
3. The strategy should address the relationship between hydrocarbon public sector enterprises and other energy companies to avoid duplicity of efforts and resources.
4. A clear strategy for securing supplies of critical minerals like copper, lithium, nickel, and cobalt is necessary due to forewarned market volatility and potential shortages.
5. The government must also create incentives for private investment in green energy to mitigate risk aversion among investors.

Question for practice:

Examine India’s current energy policy and the challenges it faces, considering its dual focus on fossil fuels and renewable energy, as well as the compartmentalization of ministries and lack of integrated decision-making.