Why India needs a Ministry of Energy

Syllabus: General Studies Paper 3

Context:

Experts may differ on the weightage to be given to the various reasons cited for the coal shortage earlier this month, but all will agree that the blame cannot be placed on the doors of anyone entity or ministry. 

• India’s coal reserve is of generally 28-30 days but due to disruption in supply chains induced by monsoons and inflated global prices, the reserve has fallen to 10-14 days.
• Such shortages invariably lead to outages, some of which are already being witnessed in some pockets of the country. Demand surges and disruption in supplies can exacerbate the issue.

Responsibility for the coal crisis:

• The Ministry of Coal and Coal India mismanaged the production process, planning supplies or leaving vacant crucial leadership positions. But they should not be made to carry the blame alone. 
• The Ministry of Power/NTPC should also accept responsibility. For they allowed coal inventories to fall below the recommended minimum in an effort to better manage their working capital. 
  • But they can claim they had no other option because the state government electricity distribution companies (discoms) to whom they sell power do not pay their dues on time or fully. 
• The discoms point a finger at their political bosses, who compel them to sell electricity to residential and agricultural sector consumers at subsidised tariffs that do not fully cover the costs of procurement. 
  • This cycle of blame is the result of a structural lacuna. 

No single unified system

• There is no one public body at the central or state government level with executive oversight, responsibility and accountability for the entirety of the coal value chain. This is a lacuna that afflicts the entire energy sector. 
  • It will need to be filled to not only prevent a recurrence of another coal crisis but also for the country to realise its “green” ambition.
• The word “energy” is not part of the political or administrative dictionary. As a result, there is no energy strategy with the imprimatur of executive authority. 
  • The NITI Aayog has produced an energy strategy. But it has no executive authority and, as was the case with the Planning Commission document “Integrated Energy Policy” published in 2006. 
  • But most of its recommendations are useless because their implementation will depend on the responses of the bureaucrats in various ministries (viz petroleum, coal, renewables and power) who, in general, have little incentive to do so.
  • The Planning Commission document was endorsed by the Cabinet and yet the majority of the recommendations were ignored.

Way forward:

• Decarbonisation of economy: A decarbonised economy is based on low-carbon power sources that therefore has a minimal output of greenhouse gas (GHG) emissions into the atmosphere.
  • India faces an energy and environmental problem. 
  • The incremental requirement of India’s energy should come from renewable energy. The Prime Minister recently announced  that by 2030, India’s energy basket would have 40 percent of its needs from the renewable sector.
  • In addition to traditional sectors, India is also looking at future sources of energy.
  • Identifying hydrogen as a priority area for India, India should work quickly on the hydrogen mission. 
  • The Union Budget for 2021-22 has announced a National Hydrogen Energy Mission (NHM) that will draw up a road map for using hydrogen as an energy source.The initiative has the potential of transforming transportation.
  • The usage of hydrogen will not only help India in achieving its emission goals under the Paris Agreement, but will also reduce import dependency on fossil fuels.
  • India’s early efforts at CNG (compressed natural gas) blending with Hydrogen in Delhi in the transportation sector is an example.
• Statutory law for energy: The government should pass an Act captioned “The Energy Responsibility and Security Act.” 
  • This Act should elevate the significance of energy by granting it constitutional sanctity; it should embed in law, India’s responsibility to provide citizens access to secure, affordable and clean energy.
  • It should lay out measurable metrics for monitoring the progress towards the achievement of energy independence, energy security, energy efficiency and “green” energy. 
  • In essence, the Act should provide the constitutional mandate and frame for the formulation and execution of an integrated energy policy.
• Creation of an omnibus Ministry of Energy to oversee the currently siloed verticals of the ministries of petroleum, coal, renewables and power. Such a ministry did exist in the early 1980s (without petroleum). 
  • The minister-in-charge should rank on equal footing with the ministers of defence, finance, home and external affairs. 
  • The PM can establish an executive department within his office; it could be referred to as the “Department of Energy Resources, Security, and Sustainability”, headed by a person of minister of state rank. 
  • The objective would be to formulate and execute an integrated energy policy, to leverage the weight of “India Energy Inc” and maximise India’s competitiveness in its dealing with the international energy community. 
  • It would, de facto, be the most powerful executive body with ultimate responsibility for navigating the “green transition”.

In this latter context, it is important to stress the positive impact the above redesign will have on investor sentiment. Several corporations have signalled their intent to invest megabucks in clean energy. Reliance has committed $10 billion, Adani $ 70 billion over 10 years; Tata Power, ReNew Power and Acme Solar have also placed their stakes in the ground. But the probability of these investments being realised would increase if the current fragmented and opaque regulatory, fiscal and commercial systems and processes were replaced by a transparent and single-point executive decision-making body for energy.

The Indian Express Link:
https://indianexpress.com/article/opinion/columns/theres-a-mismatch-between-indias-graduate-aspirations-and-job-availability-7601016/

Question- Diversification of India’s Energy mix and its propagation towards sustainable sources needs a coherent policy framework. Explain.