Round Table Discussions on Energy Security

1. Round Table Discussions on Energy Security H.L. BAJAJ Formerly TECHNICAL MEMBER, APPELLATE TRIBUNAL FOR ELECTRICITY, 2nd JULY, 2008 INDIA INTERNATIONAL CENTRE

2. STAGES OF HUMAN DEVELOPMENT PRIMITIVE PEOPLE HUNTING PEOPLE PRIMITIVE AGRICULTURAL PEOPLE ADVANCED AGRICULTURAL PEOPLE INDUSTRIAL PEOPLE TECHNOLOGICAL PEOPLE MAIN SOURCES OF ENERGY FOOD FOR HUMAN ENERGY WOOD & HUMAN ENERGY WOOD, HUMAN ENERGY & ANIMAL ENERGY WOOD, HUMAN & ANIMAL ENERGY. ENERGY FROM WATER/WIND POWER/COAL COAL, WATER & PETROLEUM PRODUCTS COAL, PETROLEUM PRODUCTS, NUCLEAR/HYDRO/WIND/SOLAR/ GEOTHERMAL PATTERNS OF ENERGY USE & ECONOMIC DEVELOPMENT

3. ENERGY CONSUMPTION - PRIME DRIVER OF THE HUMAN DEVELOPMENT INDEX

4. EVOLUTION OF GLOBAL PRIMARY ENERGY

5. ENERGY SECURITY ENERGY SECURITY MEANS THE AVAILABILITY OF ENERGY AT ALL TIMES IN VARIOUS FORMS, IN SUFFICIENT QUANTITIES, AND AT AFFORDABLE PRICES. THESE CONDITIONS MUST PREVAIL OVER THE LONG TERM IF ENERGY IS TO CONTIBUTE TO SUSTAINABLE DEVELOPMENT.

6. ENERGY SECURITY On the eve of World War I, First Lord of the Admiralty Winston Churchill made a historic decision: to shift the power source of the British navy's ships from coal to oil. He intended to make the fleet faster than its German counterpart. But the switch also meant that the Royal Navy would rely not on coal from Wales but on insecure oil supplies from what was then Persia. Energy security thus became a question of national strategy. Churchill's answer? "SAFETY AND CERTAINTY IN OIL," HE SAID, "LIE IN VARIETY AND VARIETY ALONE."

7. ENERGY SECURITY THE AVAILABILITY OF USABLE ENERGY SUPPLIES, AT THE POINT OF FINAL CONSUMPTION, IN SUFFICIENT QUANTITY AND TIMELINESS SO THAT, GIVEN DUE REGARD FOR ENCOURAGING ENERGY EFFICIENCY, THE ECONOMIC AND SOCIAL DEVELOPMENT OF THE COUNTRY IS NOT MATERIALLY CONSTRAINED.” U.N. Economic Commission for Europe (UNECE) Energy Security Forum

8. WORLD ENERGY OUTLOOK -2007 • WORLD’S PRIMARY ENERGY TO GROW BY 55% BETWEEN 2005 AND 2030; AVG. ANNUAL RATE OF 1.8% / YEAR. • DEMAND 17.7 BILLION TOE, COMPARED WITH 11.4 BILLION TOE IN 2005. • FOSSIL FUELS REMAIN DOMINANT SOURCE OF PRIMARY ENERGY, ACCOUNTING FOR 84% INCREASE IN DEMAND BETWEEN 2005 & 2030. • OIL REMAINS SINGLE LARGEST FUEL, SHARE IN GLOBAL DEMAND FALLS FROM 35% TO 32%. OIL DEMAND REACHES 116 MB/D

9. WORLD ENERGY OUTLOOK -2007 • COAL BIGGEST INCREASE IN DEMAND UP BY 73% BETWEEN 2005 AND 2030 SHARE OF TOTAL ENERGY DEMAND UP FROM 25% TO 28% - MOSTLY IN CHINA AND INDIA. • SHARE OF NATURAL GAS INCREASES MORE MODESTLY, FROM 21% TO 22%. • ELECTRICITY USE DOUBLES, ITS SHARE OF FINAL ENERGY CONSUMPTION RISING FROM 17% TO 22%. • $22 TRILLION INVESTMENT TO MEET PROJECTED GLOBAL DEMAND.

10. WORLD ENERGY OUTLOOK -2007 : INDIA • 5 TH LARGEST CONSUMER OF ENERGY - 3.7 % OF THE WORLD’S CONSUMPTION. • PRIMARY ENERGY DEMAND TO DOUBLE BY 2030, - AVERAGE GROWTH OF 3.6% PER YEAR. • COAL REMAINS MOST IMPORTANT FUEL – ITS USE TRIPLING BETWEEN 2005 AND 2030. HARD COAL IMPORTS ARE PROJECTED TO RISE ALMOST SEVEN-FOLD. • POWER GENERATION ACCOUNTS FOR MUCH OF THE INCREASE IN PRIMARY ENERGY DEMAND • AMONG END-USE SECTORS, TRANSPORT ENERGY DEMAND SEES THE FASTEST RATE OF GROWTH

11. WORLD ENERGY OUTLOOK -2007 : INDIA • POPULATION : ACCESS TO ELECTRICITY TO INCREASE FROM 62% TO 96%. • MUCH OF INDIA’S INCREMENTAL ENERGY NEEDS TO 2030 WILL HAVE TO BE IMPORTED. • NET OIL IMPORTS ALSO GROW STEADILY, TO 6 MB/D IN 2030. BEFORE 2025, INDIA: 3RD LARGEST NET IMPORTER OF OIL, AFTER THE UNITED STATES AND CHINA. • RECENT DISCOVERIES ARE EXPECTED TO BOOST GAS PRODUCTION - IT IS PROJECTED TO PEAK BETWEEN 2020 AND 2030, IMPORTS OF LNG TO CATER FOR SHORTFALL

12. WORLD ENERGY OUTLOOK -2007 : INDIA • POWER-GENERATION CAPACITY, MOSTLY COAL-FIRED, TO TRIPLE GROSS CAPACITY ADDITIONS EXCEED 400 GW • INDIA NEEDS TO INVEST ABOUT $1.25 TRILLION IN ENERGY INFRASTRUCTURE – 75% IN THE POWER SECTOR – IN 2006-2030 ATTRACTING ELECTRICITY INVESTMENT IN A TIMELY MANNER A PRIORITY • A HUGE CHALLENGE FOR INDIA – WILL BE CRUCIAL FOR SUSTAINING ECONOMIC GROWTH.

14. INDIA PRIMARY ENERGY DEMAND

15. ENERGY CONSUMPTION

16. INDIA’S ENERGY MIX

17. INDIA PROJECTED OIL DEMAND AND DOMESTIC SUPPLY

18. WORLD–DEPENDENCE ON IMPORTED OIL

19. ENERGY RESOURCES & RESERVES • BITUMINOUS/ANTHRACITE COAL RESERVES OF 240 BILLION TONNES & LIGNITE RESERVES OF 35 BILLION TONNES SHALL BE SUFFICIENT TO CATER FOR THE NEXT 200 YEARS • CRUDE OIL AND NATURAL GAS RESERVES OF 728 MILLION TONNES AND 1364 BILLION CUBIC METRES RESPECTIVELY SHALL TAKE US UPTO THE 2035 • URANIUM RESERVES OF 78000 MT HAVE ENERGY POTENTIAL EQVT. TO 130 BILLION TONNES OF COAL • THORIUM RESERVES OF 518,000 TONNES HAVE ENERGY POTENTIAL EQVT. TO 860 BILLION TONNES OF COAL • HYDRO POTENTIAL : 150,000 MW • RENEWABLE ENERGY POTENTIAL: 77,000 MW • SOLAR : 40,000 MW

20. 200 Mev 200 MeV

21. COMPARISON OF ENERGY RELEASE CHEMICAL REACTION 4 to 12 eV (COMBUSTION OF ONE ATOM OF CARBON) NUCLEAR FISSION 200 MILLION eV (ONE ATOM OF URANIUM 235) (~20,000000 times more)

22. A 1000 MW unit ( Light Water Reactor Type) would need about 1000 Tons of enriched fuel for 25 years of operation.

23. da D

24. THORIUM RESOURCES (FERTILE) NATURAL URESOURCES REST 99.3% U-238(FERTILE) U-2350.7% (FISSILE)

25. THORIUM RESOURCES (FERTILE) NATURAL U RESOURCES Pu U-2350.7% (FISSILE) REST 99.3% U-238(FERTILE)

26. 12 GWe, 30 Yr Natural Th Uranium ELECTRICITY PHWR 300 GWe, 30 Yr Th Depleted U Pu FUELLED ELECTRICITY FAST BREEDERS Pu 500 GWe, 500 Yr U - 233 FUELLED U - 233 Pu ELECTRICITY BREEDERS U - 233 STAGE 1 STAGE 2 STAGE 3 OVERVIEW OF THREE STAGE NUCLEAR POWER PROGRAMME

27. THREE STAGE NUCLEAR POWER PROGRAM • Stage – I PHWRs • 14- Operating • 4- Under construction • Several others planned • Scaling to 700 MWe • Gestation period being reduced • POWER POTENTIAL  10,000 MWe • LWRs • 2 BWRs Operating • 2 VVERs under • construction • Stage - II • Fast Breeder Reactors • 40 MWth FBTR - Operating • Technology Objectives realised • 500 MWe PFBR- Under Construction • POWER POTENTIAL  350,000 MWe • Stage - III • Thorium Based Reactors • 30 kWth KAMINI- Operating • 300 MWe AHWR- Under development • POWER POTENTIAL  Very Large. Availability of ADS can enable early introduction of Thorium on a large scale

28. DELIVERING ENERGY SUSTAINABILITY: SUSTAINABILITY - KEY TO DELIVERING ENERGY • KEEP ALL ENERGY OPTIONS OPEN • ENERGY EFFICIENCY MUST BE INCREASED. • ENSURE INVESTMENT IN ENERGY • COST-REFLECTIVE ENERGY PRICES ARE ESSENTIAL - SYSTEMS WHICH DO NOT PAY FOR THEMSELVES ARE ULTIMATELY UNSUSTAINABLE. • ADOPT PRAGMATIC APPROACH TO MARKET REFORM Contd…

29. DELIVERING ENERGY SUSTAINABILITY: • ENSURE RELIABILITY OF SUPPLY • PROMOTE INTEGRATION OF ENERGY SUPPLY SYSTEMS THIS FURTHER SUPPORTS RELIABILITY AND CALLS FOR STRONGER REGIONAL COLLABORATION. • R&D TO ENSURE DEVELOPMENT WITH ENVIRONMENTAL PROTECTION

30. 2000 NIGHTLIGHTS

31. NIGHTLIGHTS 2070

32. Thank you

33. ABSTRACTS FROM GOLDMAN SACHS REPORT ‘THE PATH TO 2050’ OVER THE NEXT 50 YEARS, BRAZIL,RUSSIA,INDIA AND CHINA-THE BRICS ECONOMICS-COULD BECOME A MUCH LARGER FORCE IN THE WORLD ECONOMY.USING THE LATEST DEMOGRAPHIC PROJECTIONS AND A MODEL OF CAPITAL ACCUMULATION AND PRODUCTIVITY GROWTH, WE MAP OUT GDP GROWTH,INCOME PER CAPITA AND CURRENCY MOVEMENTS IN THE BRICS ECONOMICS UNTIL 2050

34. THE RESULTS ARE STARTLING.IF THINGS GO RIGHT, IN LESS THAN 40YEARS, THE BRICS ECONOMICS TOGETHER COULD BE LARGER THAN THE G6 IN US DOLLAR TERMS.BY 2025 THEY COULD ACCOUNT FOR OVER HALF THE SIZE OF THE G6.CURRENTLY THEY ARE WORTH LESS THAN 15%. OF THE CURRENT G6, ONLY THE US AND JAPAN MAY BE AMONG THE SIX LARGEST ECONOMIES IN US DOLLAR TERMS IN 2050. ABSTRACTS FROM GOLDMAN SACHS REPORT ‘THE PATH TO 2050’ Contd.

35. THE LIST OF THE WORLD’S TEN LARGEST ECONOMIES MAY LOOK QUITE DIFFERENT IN 2050.THE LARGEST ECONOMIES IN THE WORLD (BY GDP) MAY NO LONGER BE THE RICHEST(BY INCOME PER CAPITA), MAKING CHOICES FOR FIRMS MORE COMPLEX. ABSTRACTS FROM GOLDMAN SACHS REPORT ‘THE PATH TO 2050’