The global energy agency has called India a vital nation for the future of the global energy markets.
International Energy Agency (IEA) has appreciated India’s efforts in the field of energy and said that energy research, development, and deployment can largely contribute to broader national priorities such as Narendra Modi’s flagship scheme of ‘Make in India’. “The Government of India has made impressive progress in recent years in increasing citizens’ access to electricity and clean cooking,” said the IEA India Report 2020. It also said that India has successfully implemented a range of energy market reforms and carried out a huge amount of renewable electricity deployment, notably in solar energy. The global energy agency has called India a vital nation for the future of the global energy markets due to its large population base and being one of the world’s fastest-growing major economies.
However, the agency has also suggested measures that can further improve the performance of the energy sector in India.
Following are the few key recommendations by IEA:
- Establish permanent energy policy coordination
IEA has recommended that India should establish a permanent energy policy coordination in the central government, with an overarching national energy policy framework to support the development of a secure, sustainable and affordable energy system.
- Encourage investment in energy sector
The agency has also suggested to ensure full non-discriminatory access to energy transport networks to encourage investment in the country’s energy sector.
- Smooth integration of variable renewable energy and power system flexibility
IEA has advised the Indian government to work with the states to implement the power sector and tariff policy reforms with a focus on the smooth integration of variable renewable energy and power system flexibility. It also recommended moving from government allocation of energy supplies to allocation by market pricing.
- Reinforcing oil emergency response measures
The international agency has asked the government to prioritise actions to foster greater energy security by reinforcing oil emergency response measures with larger dedicated emergency stocks and improved procedures, including demand-restraint action and proper analysis of risks.
In an acknowledgment to the IEA report, the government said that the appreciation it has received is for its relentless march in undertaking tectonic reforms in the energy sector and continued pursuit of market-based solutions. “We have taken note of IEA’s recommendation for reinforcement of India’s oil emergency response policy. Enhancing international engagement on global oil security issues is already an active goal being pursued by my Ministry,” said Dharmendra Pradhan, Minister of Petroleum & Natural gas.
He added that energy has become an essential commodity in India’s bilateral trade engagements and in positioning India as an important strategic player in the global energy landscape.