Mechanisms to Alleviate the Security challenges of Energy

Mechanisms to Alleviate the Security challenges of Energy Resources S L Rao TERI-KAS CONFERENCE, GOA, 2 OCTOBER 2009

2. Indian Constraints 1. Subsidized and untargeted Power 2. Regulatory capture by governments (tariffs, open access) 3. Dominant and inefficient government sector in distribution and even central generation (Low execution efficiencies in NHPC and NTPC) 4. Backward in clean coal technologies because of state monopoly producer, BHEL 5. Inefficient and government owned coal mines 6. Vast gas finds but poor regulation 7. Universal Service

3. Water • Excessive energy use for ground water • Low water tariffs prevent O & M of storage projects • Ownership, use and pricing for ground water • Low urban water pricing

4. Hesitant Policies • Government inefficient in acquiring overseas energy resources • Need for private sector to enter & government support • Clean Coal technologies-supercritical boilers; carbon sequestration, etc • Hesitant use of fiscal means to curb demand for energy inefficient products/equipment

5. Nuclear Energy • Present costs unknown-hidden • New plants-high and rising costs, hihg energy costs, slow in execution • Need for change in laws on private ownership, nuclear accidents liability • Possibility of cartels and Western blackmail

6. Hydro • Poor record on time and cost • Poor local involvement and consultation • Neighboring countries-need for traties with Nepal, Pakistan, even China • Deal politically with local insurgencies • Use single consultant and open assessment of seismic, geology, etc • Similarly with local populations

7. Nuclear Energy • Present costs unknown-hidden • New plants-high and rising costs, high energy costs, slow in execution • Need for change in laws on private ownership, nuclear accidents liability • Possibility of cartels and western blackmail • Domestic uranium-people policies

8. Climate Change • • • Be open, not defensive Show what we are doing What we need Succumbing to sweet talk-e. g. Nuclear 123 Incentives for private and foreign investments in R E

8. Lifestyles • Green buildings, public transport, energy efficient equipment, water use, • Using differential taxes • Social cost benefit to make RE more comparable

11. Governance • Coordination-Energy-5 Ministries • Many regulators • Overseas-need for MEA to work closely with Power, Water, Defense, etc • Perhaps task forces

12. Regulation • Campo- and R & R-central authority and penal speed as well as penal provisions • CAMPO-make it work • NPV in installments • Clean up regulatory confusion- multiple sector regulators, CCI, FMC