The Energy Scenario

The total energy use has witnessed an expansion over last five decades and there is a shift from non-commercial to commercial energy sources. Table

1.1 shows the trends in production of commercial energy.

Table 1.1 Production of Commercial Energy

*MT - Million Tonnes,

**BCM - Billion Cubic metre,

***BKWh - Billion kilo watt hour

Table 1.1 indicates that coal is the most abundant commercial energy source and during 1970-2001, its production has shown an average annual growth rate of 5.11%. However, its share in energy supply has decreased which used to be 60.47% in 1970-71 and is about 44.8% in 2001-2002.

The coal will remain in the centre stage of energy scenario of India because power generation favours this fuel as its availability is quite high. About 70% of coal produced is consumed in the power sector. Other industries like steel, cement, fertilizer, chemicals, paper and other small and medium industries also depend upon coal for their energy demands. As far as the transport is concerned, the railways is phasing out steam locomotives but the energy requirement for electric traction is still dependent on coal (Ministry of Coal, 2003).

About 75% of the total coal reserves in India are located in Bihar, Madhya Pradesh and West Bengal. The total coal reserves, as per Geological Survey of India (January 2003), are estimated to be 240.78 billion tonnes. Out of this, 37.42% is in the proven category, 46.78% in the indicated category and 15.8% is in the inferred category. The coking coal resources amount to 13.28% whereas non-coking coal resources form 86.72% of the total resources.

The coal resources of India account for 8% of the world’s total resources. India is the third leading coal producer in the world after China and the United States.

Although, the domestic production of petroleum and natural gas has increased over the years, India depends heavily upon crude oil imports. During 1970-2000, the oil production has increased at the rate of 5.33% per annum. Parallel to this, there is an increase from 12.43 MT to 75 MT in the import of crude oil and petroleum products (Ministry of Petroleum and Natural Gas, 2002). This is mainly because the consumption of petroleum products has increased manifold in all sectors, particularly in industry and transport.

During 2000-2001, the transport sector consumed nearly 23.24 MT of petroleum products while the industrial sector consumed 12.32 MT. Petroleum products such as high speed diesel, diesel, light diesel oil, fuel oil etc. for power generation amounted to 5 MT whereas the agricultural sector consumed nearly 7.7 MT of petroleum products (Ministry of Petroleum and Natural Gas, 2002).

The recoverable resources of crude oil and natural gas were 732 MT and 763 BCM (billion cubic metre), respectively as on March 2002. In 2001-02, the production of crude oil and natural gas was 32 MT and 29.7 BCM, respectively. However, the country still imported 78.7 MT of crude oil which amounted to 73.3%. The discovery of 7 TCF (trillion cubic feet) of natural gas by Reliance in Krishana-Godavari basin in 2002 has improved the energy situation.

As far as the power sector is concerned, the consumption was 1.3 GW (gigawatt) at the time of independence which has grown to more than 100 GW at present. The installed generating capacity is nearly 107 GW as on January 2003 as per the Central Electricity Authority. Out of the total installed capacity, 90% is owned by the public sector (60% under State Governments and 30% under the Central Government) and rest 10% is with the private sector.

1.4