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NITI Aayog’s Draft National Energy Policy: Need to Redo [Mains Article]

Many experts want the entire process of making the draft again with improvisations. There a few contradictions in the draft which needs to be addressed by the government as soon as possible.
By IT's Mains Articles Team
November 16, 2017

Contents

  • Introduction
  • Key Objectives of NEP
  • Targets of National Energy Policy
  • Key takeaways from the draft policy
  • Need for NEP
  • IEP 2006 Vs. NEP 2017
  • India Vision 2040
  • Issues with the draft NEP 2017
  • What needs to do?
  • Conclusion

NITI Aayog’s Draft National Energy Policy: Need to Redo

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GS (M) Paper-2: “Government policies and interventions for development in various sectors and issues arising out of their design and implementation.”
GS (M) Paper-3: “Infrastructure: Energy”

 

Introduction:

  • The 2017 National Energy Policy (NEP), drafted by the NITI Aayog, takes the baton forward from the 2006 Integrated Energy Policy (IEP) in setting the trajectory of growth for the energy sector.

ias-toppers-Niti-Aayog-SATH

Key Objectives of NEP:

  • There are four key objectives of National Energy Policy.
  1. Access at affordable prices,
  2. Improved security and Independence
  3. Greater Sustainability and
  4. Economic Growth.

Key Objectives of NEP iastoppers

Targets of National Energy Policy:

  • The intention of the National Energy Policy is to present a broad framework for the overall energy sector, taking into account the multiple technology and fuel options.
  • All the Census villages are planned to be electrified by 2018, and universal electrification is to be achieved, with 24×7 electricity by 2022.
  • The share of manufacturing in our GDP is to go up to 25% from the present level of 16%, while the Ministry of Petroleum is targeting reduction of oil imports by 10% from 2014-15 levels, both by 2022.
  • INDC (Intended Nationally Determined Contributions) target at reduction of emissions intensity by 33 percent-35 percent by 2030 over 2005.
  • Achieving a 175 GW renewable energy capacity by 2022, and share of non-fossil fuel based capacity in the electricity mix is aimed at above 40% by 2030.

Key takeaways from the draft policy:

2017-National-Energy-Policy-(NEP)-iastoppers

  • NITI Aayog’s National Energy Policy is aimed at curbing imports by increasing production of renewable energy in the country fivefold to 300 billion units by 2019 and tripling coal production to 1.5 billion tonnes.
  • Coal imports are envisaged to come down by 10% by 2022 and by 50% by 2030.
  • This policy will replace the Integrated Energy Policy of the previous government.
  • Policy focus on clean energy resources such as solar and natural gas
  • NITI aayog also plans to set up the National Energy Data Agency on the lines of the US Energy Information Administration (EIA).
  • Agency will aim to provide oil and gas mapping by working with the Directorate General of Hydrocarbons, transmission line mapping, energy demand mapping and solar irradiation mapping, among others.

Need for NEP:

  • Energy is acknowledged as a key input towards raising the standard of living of citizens of any country, as is evident from the correlation between per capita electricity consumption and Human Development Index (HDI).
  • Accordingly, energy policies of India have over the years directly aimed to raise per capita energy consumption, even while the main focus of the country’s development agenda has been on eradication of poverty.
  • While India strives to achieve a double digit growth rate in its national income, it is equally important that clean energy is available to all the citizens.
  • The NEP draft comes at a time when the energy sector is seeking clarity. In the face of claims of surplus power, even as rampant energy poverty continues to plague the country, the sector needs clear signals of the future pathways.

IEP 2006 Vs. NEP 2017

  • The Integrated Energy Policy of 2006 is the base of the current National Energy Policy drafted by the NITI Aayog.
  • The primary difference between the two policies is the approach used to achieve the objectives, the IEP made a basket of specific measures which were to be used to achieve the goals.
  • In the case of NEP, a broad framework for the entire energy sector is considered including vast technology and various fuel options.
  • The transition from IEP to NEP is important to check the sudden decline in the renewable energy tariffs and to scale up the grid-connected to clean energy sources.

India Vision 2040

  • The NEP aims at supporting the Indian ambition to emerge as a well-developed and resilient economy with high level of human development.
  • Additionally, it helps prepare the nation to anticipate the technological and market related changes in the energy sector.

Issues with the draft NEP 2017

concerns_NITI_Aayog_s_National_Energy_Policy

  • The NITI Aayog claims that over a period of time India will become a net exporter of coal at a time when most of the countries are shunning coal based energy plants for clean and environment-friendly energy plants.
  • The consumption of coal has been estimated to grow to around 330-441 GW by the year 2040 which contradicts the aim to shift towards renewable sources of energy like wind and solar plants.
  • Also at a time when the tariffs of solar and wind energy are at an all time low growing dependency nullify the motive behind adopting environment-friendly energy sources.
  • The draft instead of phasing out the existing thermal power plants focuses more on relocating the existing plants in places where do not affect human habitations to an extent of causing serious damage.
  • There is also some amount of repetition in the current draft. Promoting LPG imports and providing incentives for shale and conventional gas exploration have already been proposed in previous policies.
  • There needs to be more strict and strong action proposed for pipelines like the Ira-Pakistan India (IPI) and Turkmenistan- Afganistan- Pakistan- India as there has been little progress in the past 20 years on them.

What needs to do?

  • The current DNEP has only a few measures to check the uncertainty of the producers and distributors and is more focused on providing the government enough room to maneuver in the implementation process and tailor the solution as per the changes in the market.
  • It will be much better to have specific steps to be taken to achieve the goals rather than a framework to improve the workability of the policy in the future.
  • Clear energy pathways and strong policy are the need of the hour considering the steady and promising growth of global energy market.
  • More measures should be included to make the wind and solar energy more viable and economical.

Conclusion:

  • Many experts want the entire process of making the draft again with improvisations.
  • There a few contradictions in the draft which needs to be addressed by the government as soon as possible.
[Ref: Indian Express, Live Mint, Business Standard, The Wire]

 

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