Enhanced energy efficiency has succeeded in bringing down India’s energy intensity, observes the newly-released Economic Survey 2021.
Energy intensity, in general, is understood as the amount of energy required to produce one unit of output. If less energy is required to produce one unit of output, the better it is. The energy intensity of India (at 2011-12) prices decreased from 65.6 toe per crore rupees in FY12 to 55.43 toe per crore rupees in FY19. Interestingly, during the same period, per capita energy consumption increased from 0.47 toe in FY12 to 0.58 toe in FY19.
Explained: “toe” stands for “tonnes of oil equivalent”. As energy can be in various forms—primary coal, oil and electricity—overall energy consumption is measured as an equivalent of oil. In FY12, it required 65.5 tonnes of oil equivalent energy to produce output worth Rs.1 crore. This declined to 55.43 toe in FY19. What this simply means that for the same output (worth Rs.1 crore at 2011-12 prices), the amount of energy required has decreased. This has come about partially due to energy efficiency.
On the other hand, the per capita energy consumption has increased from 0.47 toe in FY12 to 0.58 toe in FY19. This is also a good sign as energy consumption is a precursor to industrial and socio-economic development.
Both the indicators—energy intensity and energy consumption—seen in conjunction, have shown a healthy trend between FY12 and FY19.
Transformation on both demand and supply side
The Economic Survey has observed that there has been a transformation on both the demand and supply side of the power sector. Universal electrification is the major positive development on the demand side, while the growing contribution of green energy is that on the supply side.
The total power generation installed capacity has increased from 3,56,100 mw in March 2019 to 3,70,106 mw in March 2020. Further, this increased to 3,73,436 mw in October-2020. The latest capacity comprised of 2,31,321 mw of thermal, 45,699 mw of hydro, 6,780 mw of nuclear, and 89,636 mw of renewables and others. The capacity addition in the power sector was mainly driven by the Government in FY20.
Universal electrification
In 2014, The Government of India approved the Integrated Power Development Scheme (IPDS), with a total outlay of Rs.32,612 crore, to facilitate state utilities to ensure quality and reliable 24×7 power supply in the urban areas. So far, projects worth Rs.30,991 crores have been sanctioned to the states and the distribution strengthening has been completed in 442 of the 546 circles till the end of September 2020. Further, the country has already accomplished two major landmarks in rural electrification arena—100 per cent village electrification under Deen Dayal Upadhyaya Gram Joyti Yojana, and universal household electrification under ‘Pradhan Mantri Sahaj Bijli Har Ghar Yojana’ (Saubhaagya).
T&D Losses
T&D losses have been declining since 2001-02 but are still substantial. As compared to the T&D losses of the peer countries, India’s T&D are very high. (See charts)
(Featured photograph (source: orfonline.org) is for illustration only. Charts have been sourced from the original Economic Survey 2021 document.)
