Regional Energy SecurityPolicy & Institutional Issues

Presented on

“International Conference on Power Systems (ICPS)”

Institute of EngineeringTribhuvan University, KhatmanduIEEE, IIT Bombay, SARI/Energy

Organised by

on4 Nov 2004Khatmandu

byT.L. SANKAR

ASCI, Hyderabad

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Defining the Region

≫ Our countries are parts of several regional initiatives. South Asia Asia Pacific ESCAP Countries ASEAN Countries

≫ This discussion confined to South Asia region as covered by SAARC.

≫ Includes: Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka.

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Rationale for South Asian Regional Energy Security

≫ Countries are widely divergent in Size Population Resource base Energy needs

≫ Still they share similarities and complementarities in Energy Status Similarities provide basis for cooperation Complementarities provide opportunities for sharing

resources. Additional drivers for regional energy initiatives –

o Increasing need to ensure safety of energy infrastructureo Concern for preserving environmental quality

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Similarities : High levels of poverty Low per-capita commercial energy consumption High, increasing dependence on oil and gas Power availability and accessibility very low &

inadequate Power utilities poorly managed, financially precarious Overall energy efficiency low Inadequate attention to energy conservation and

environmental concerns Exploitation of renewable energy technologies - below

market and economic potential

South Asia Region – Energy Status

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Complementarities : Mismatch between the energy resource availability and

demand. Skewered distribution of fuel and hydropower

resources. Compare to their needs, Bhutan and Nepal have

enormous hydro resources. India has more coal resources. Bangladesh has more gas resources.

Market for fuels for power huge in India. Energy consumption mix varies widely. Power sector capital equipment manufacturing capacity

widely varying.

South Asia Region – Energy Status

Contd.

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South Asian Regional Energy Status - Present & Future

S. No

Fuel Year

2000 2010 2020 2030

1 Renewable Energy etc51.8(3%)

169.3(7%)

161.9(5%)

41.3(1%)

2 Hydro

3 Nuclear

4 Natural Gas 155.3 (9%)

266.1 (11%)

420.9 (13%)

743.0 (18%)

5 Oil 569.6 (33%)

822.5 (34%)

1100.9 (34%)

1403.5 (34%)

6 Coal 949.3 (55%)

1161.1 (48%)

1554.3 (48%)

1940.2 (47%)

7 Total 1726.0 2419.0 3238.0 4128.0

(in Mtoe)

Outlook for Supply / Demand in Asia (by Fuel)

Source: Computed from the Bar Graphs in the site given below.Website: http://www.enecho.meti.go.jp/english/energy/world/asian_outlook.html of Agency for Natural Resources and Energy (ANRE), Japan.

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What is energy security ?

≫ Meeting energy supply disruptions due to non-availability, transport constraints, or price.

≫ Ensuring sustained supply of energy in adequate quantities of appropriate quality at affordable prices.

≫ Minimising environmental adverse impacts in the production, transport and use of energy in all forms.

≫ Regional energy security is a subset of overall regional security and developmental arrangements.

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Regional Energy Security

Architecture :

Regional Energy Policies and Regional Energy Security plans are not substitutes for sound National Energy Policies, National energy plans & National security arrangements.

The National and Regional Energy Policy and Plans should be complementary and the two should be harmonised.

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Regional Energy Security Plans Harmonising with National Plans

Key attributes.Optimal exploitation of energy

resources.Reduced dependence on oil imports.Reduce imports from outside the

regions & optimise energy trade within the region.

Transparency & sharing of information re: resources, export-import process, quantities

Key objectives of National Energy Policy

National plans for energy development and security

Regional Policy Broad guide lines for energy

plans & energy security

National energy policy for energy development

and security

Regional level actions National level Actions

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Regional Energy SecurityHarmonising with National and Regional

Institutions

Information sharing, exchangeCross-border investment

public / private for resource development transport trade.

Energy equipment tradeTransfer/trade of skills &

capacity building efforts

Unified arrangements for

enhancing regional energy cooperation

& security

Regional energy institutions

National energy institutions

Regional Strategic Petroleum Reserve (SPR) arrangements, institutions.

Agency for National Strategic Petroleum Reserve

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South Asian Regional Energy Risks

Contingency Risk = Risk due to disruptions of supply of energy products due to war / other problems, in producing countries or receiving countries or on transport routes.

Structural Risk = Due to resource demand mismatch, over-dependency due to sourcing of supply, other reasons.

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Security Arrangements to meet Contingency Risks

Short-term Supply disruptions :

Increasing imports from other regions by - diversifying sources of supply - through contingency contracts

Sharing of risk bearing with other countries. Having Strategic Petroleum Reserve (SPR)

at the national level and regional level

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Security Arrangements to meet Structural Risks

≫ Diversification of fuel supply arrangements Diversify sources of supply Reduce dependence on single supply region

≫ Diversify fuel-mix of consumption Reduce oil dependency Reduce imported gas usage Substitute oil with gas supplied under long-term

contracts in transport sectorpower sectordomestic use sector

Increase the use of coal with clean coal technologies Increase the use of hydel resources

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≫ Introduce indigenous substitutes for imported gas Coal bed methane Gas hydrates

Contd.

≫ Increase use of renewables - Hydropower – large, small, mini, micro Wind power Biomass based power Biofuels in place of oil products

≫ Energy efficiency improvements in Production Transformation Transmission Usage

Security Arrangements to meet Structural Risks

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Regional Cooperation Opportunities to increase energy security

≫ Hydroelectric resources - Bhutan & Nepal have enormous/surplus resources India has potential to absorb

≫ Electricity -

By joint development major power sales-transfer By commercial norms interchange in border areas

≫ India’s coal based super thermal stations to meet the base load power demand in the region.

≫ Joint development plans for hydro power

Bhutan successful Nepal – ongoing efforts

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Contd.

Regional Cooperation Opportunities to increase energy security

≫ Gas resources

≫ Gas pipelines Gas from Mynmar through Bangladesh Gas from Oman, Iran through Pakistan

Bangladesh has surplus resources India’s gas needs are very large

≫ Renewable Energy development

Focussed, harmonised R&D efforts in technology / application development of RE Technologies

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Institutional Arrangements for Regional Energy Security

≫ Bilateral Indo-Bhutan, Indo-Nepal Hydro Development Corporation

≫ Regional Power Grid (EHV) Corporation≫ Regional Transmission Reliability Council≫ Bilateral, multi-lateral gas pipeline corporations≫ Regional energy training centres for engineers in

development/operation of power systems≫ Professional/Citizen groups to evolve, advocate

important regionally relevant energy issues

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THANK YOU