Energy issues are back in focus. The nuclear deal, now supposedly stalled, is about seeking energy security in a non-polluting way. The Nobel Peace Prize to Al Gore and the Inter-Governmental Panel on Climate Change currently headed by RK Pachauri, is for work on global warming caused by excessive use of fossil fuel. It is further recognition of the incontrovertible scientific evidence that global warming is not a long-term natural cyclical phenomenon but the outcome of human activity. This is notwithstanding some sceptics like Bjorn Lomberg in his recent book entitled Cool it: The Skeptical Environmentalist Guide to Global Warming, in which he questions some conclusions and interse priority on resource allocation. While the need for concerted global action is inescapable, national governments have a predominant obligation to take action, and the question inevitably arises of whether India is making a responsible contribution.
Leaving aside the rhetoric, there are five areas of growing concern. First, distortionary energy pricing has only got worse in the last two years. Until energy from conventional sources is appropriately priced, commercial investment in alternate renewable fuels will remain tardy. While everybody recognises that the era of cheap oil is over and oil companies have shifted their baseline price from $27 to $55 per barrel, we continue to view current trends as transitional. The accumulated oil bonds as well as bonds to be issued this year, to make up for large under-recoveries in the petrol sector, is just the wrong way to go, irrespective of global crude oil prices. Murli Deora perhaps recognises that this is disastrous not only for the health of the oil companies but intrinsically irresponsible both in terms of fiscal rectitude and India?s response to climate change. Micro-managing day-to-day pricing for petroleum products may be an evil that Deora inherited, but things have only got worse in the last few years. De-politicising tariff and administered petroleum prices is an inescapable ingredient of any energy strategy.
Second, apart from moderating the demand-related issues of energy efficiency in terms of alternative fuel choices, inadequate attention has been paid to new sources of light, architectural design changes and new technology options. The Energy Conservation Act administered by the Ministry of Power needs a new enforcement master.
Third, the Ministry of Non-conventional Energy has traditionally been under the charge of political lightweights. However, issues like R&D on renewable energy keeping ahead of technological changes elsewhere, harnessing our comparative advantage in many renewable sources like solar, biogas and agro-waste, and integrating these as part of our mainstream energy policy, needs far greater political authority and will than has been evident so far.
Fourth, on the issue of India?s international obligations, our traditional position, based on the principle that polluters must pay and that developing countries must be exempt from accepting quantitative restrictions and changes in their pattern of economic activity, has served us well. It is also true that the total stock of pollution (as against flow) is primarily the contribution of the developed countries, and they must bear the basic burden of mitigation. Nonetheless, as emerging markets increase their pace of economic activity, they would be increasingly responsible for contributing to the flow of pollutants, and populous countries like India and China would have an increasingly larger role to play. It would become difficult to persuade the US and others that we should continue to remain totally exempt from such obligations. The short point is that while a case for differentiated obligation is a compelling one, a total exemption would become difficult to sustain if we are to assume any leadership role on climate change.
Fifth, issues of energy policy are scattered over too many ministries and organisations. Petroleum and Natural Gas, Forest and Environment, Coal, Power, Non-conventional Energy, External Affairs and a number of other organisations are involved in some form or the other. Political compulsions may not permit the Prime Minister of any coalition government to integrate or carve out a truly separate Ministry of Energy. The Kirit Parekh Report on an integrated energy policy, which made many sensible recommendations, does not have an implementation strategy.
I would suggest the constitution of a National Energy Commission to function as an autonomous entity as a part of the PMO to become the implemention agent of the many worthwhile recommendations that have emanated from several reports. The Commission can derive its political authority by being part of the PMO, and should be manned by domain experts and function as an empowered committee. It should report to a Cabinet Committee on Climate Change to be headed by the Prime Minister.
The recognition of Pachauri as head of the IPCC has refocused global attention on a possible leadership role for India. Issues of climate change and poverty redressal, integrated as they are in many ways, will remain high on the global agenda. India has a long way to go in removing poverty, and by assuming a leadership role on issues of global warming, it can bring synergy to what is inevitably the centrepiece of any development strategy.
NK Singh is a former top bureaucrat. These are his personal views