February 2, 2018

Speaking at 7th India Energy Congress, in New Delhi

…order that is emerging in the world where I would otherwise have said all countries, but in the current context I will have to say all but one country are seriously concerned about the future of the world. I think in that context it’s great that the Congress is focusing on looking into the crystal ball and gazing into the future. I was just reading some of the sessions that you have put together. It’s an interesting mix of subjects and will be very relevant when we as policymakers are planning for the future. My compliments to all the organizers and a very good afternoon to all of you, distinguished ladies and gentlemen.

I must begin by saying I sometimes do miss the power sector. One of the main reasons is that I could sleep at anywhere between 1 and 2 o’clock in the night, after the railways it’s anywhere between 3 and 4 in the night. But, truly, I learnt a lot while I was in the Ministry along with all of you, distinguished ladies and gentlemen. While I did not know much about the power sector or how it is evolving in the world, this 3-year period did give me deep insights into, both the Indian situation and what’s happening in the world.

And I must say, all of you have done India proud when it comes to our position in the world – the way the Indian energy sector is evolving, the way we are making rapid strides, we have moved from a energy-shortage country to an energy-surplus country. The kind of work we have done on energy conservation is the toast of the world, in every engagement across the world there is a mention about the very successful efforts on energy conservation, particularly, the robust LED programme that all of you have very successfully implemented.

The fact that honesty and transparency, along with economies of scale, helped us bring down the price of different forms of energy, be it renewable energy, wind, solar, for that matter, be it even the thermal power where through rationalization of linkages, a more honest and transparent methodology, so that everybody gets a fair opportunity to enjoy linkages or have the availability of coal at reasonable prices. All of these things I think have once again brought back confidence in the power sector.

But the time is now ripe to plan what next, how we are going to transition into the next decade and prepare ourselves as our own position in the world keeps improving. We are already moved up from the 7th largest economy to the 5th possibly. We will soon probably be the 3rd largest economy, and not too far away in the future I see India becoming the 2nd largest economy in the world.

Of course, we are supporting a very large population, yet the opportunities that we have in India today are one of our biggest strengths. And in that sense, we have become the laboratory for the world when it comes to this transition into the new age of technology, into the new age of a cleaner energy mix. And I must say, the efforts that all of you have put in to prepare India to transition into this new age are really remarkable.

I still recall the various launches of reports on integrating renewable energy in the 175 GW ambitious target that we have into the grid. And I think the last report we released was at Meridian which was the 11th or the 12th report on integrating RE into our grid – which shows the seriousness with which India has engaged with this subject and the wide amount of knowledge that we have gathered to prepare ourselves to move forward into this new fields of energy in such large measure.

And the speed at which all of you are working, I am given to understand solar power has crossed 20 GW now? A good 4 years ahead of schedule! We have advanced our 2022 target and completed it within 2017-18. It’s truly a remarkable achievement. And going forward, this only strengthens our resolve to achieve the 100 GW target. I believe wind energy prices have also right sized themselves quite a bit.

There is, of course, a small lobby which still believes they can pass on their inefficiency onto the consumer. They have been going all over the place trying to get back the feed-in tariff and put up all sorts of arguments against honesty and integrity in procurement processes, but I think that’s a part, that’s the evolution that every sector goes through when we are transitioning into a new way of working.

And then it doesn’t matter whether it is Rs 2.5 or Rs 3 or thereabouts, it will of course vary from place to place depending on the wind velocity availability. But, let us use this opportunity where all of you are now gathered to look at a little bit beyond 2022. In 2022, with a 175 GW of wind and solar and by that time possibly 50 GW of hydro, which I hope you continue to pursue to move it into the renewable energy, because it rightfully belongs there. With 225 GW of renewable energy, my own sense is that we would be at about 15% of our actual consumption or possibly slightly more, maybe 17% of our consumption coming out of renewable energy.

One can take satisfaction that it has moved up so significantly from 3 or 4%, or one can draw inspiration to see how we can go to the next level. And my own feeling is, with technological advancements, as we get better PLFs on solar power, as we get better wind generation with larger turbines, as we transition to taking wind energy off shore, so that we can really generate much more power using the wind which is normally much stronger in the ocean or in the sea, and with transmission costs actually becoming quite reasonable now in the context of the whole cost of power and technologies allowing underground cabling, I would think we should now look at a next step where along with our natural growth we look at transitioning to about 30% from 15%, which doesn’t mean doubling, which would probably mean nearly quadrupling our renewable energy sources.

And I would suggest that 2030 would be a good year to look or crystal gaze into the future and plan for something like a 30% target on clean energy, because while we are all agreed and we are all on the same page that we can’t wish away coal, we need a base load into our system. And all of us will collectively work to see how we can clean coal better. Can we move into the new age of lower pollutants coming out of our thermal plants, particularly, after FGDs and all of them are installed, implementing the new rules that the Environment Ministry had put out. Can we start converting more of coal into gas and clean up coal better, as much of washery coal as we will all agree to use, even though it may have a little cost implication but some of it will be offset because of the transport cost coming down, and with proper blending we may actually be able to reduce the transport cost on the one hand and get cleaner coal at the thermal power plants which are spread out all over the country.

We could also possibly Ajay ji look at our Leh-Ladakh programme again. I remember we aborted that despite it giving us very good PLF, because of the large transmission cost. Now my own sense is, with transparency and bidding in transmission, we have been able to bring some amount of stability in those prices. And at the same time, solar power having become much cheaper; to encourage Make in India we will need to have some large projects coming up. We could once again re-examine the Leh-Ladakh project, at lower cost of generating power we could actually afford to pay a little more for transmission and the landed cost would still be very attractive in the long run. And it would also give us power for probably a little longer duration.

….hours of sun that Leh-Ladakh has, so maybe some such working may be an interesting possibility. But we must seriously look at all the various emerging technologies which can help us transition to the next level. But for today, if I have to crystal gaze into, transition into a new energy future for the world, may I venture to suggest that if we truly want to bring out the best across the globe in terms of clean energy, and in the context of what happened in Paris where 195 countries did finally come together and, collectively, agreed to work towards a better future for the world and for the people of the next generation that commitment that we have all taken upon ourselves to create a better planet to live in, could we all just visualize for a moment that just like in India. And I draw inspiration from the fact that India is one of the first large countries, I don’t know any other country of the size and scale of India which truly has a One-Nation, One-Grid concept. Sadly, we still have countries divided into smaller zones – it may have its own advantages in the short run, but just like our One-Nation, One-Grid really gave a lot of benefit where we can seamlessly move power throughout the country and stabilize prices. Most times of the day we have power available throughout the country at A price, which in many cases is sub-Rs 3 or Rs 3.5 most cases.

Could we all visualize a global transmission grid in which power can flow seamlessly from one region to the other and then when we look at the fact that the sun shines bright in different parts of the world at different times of the day, when we see that wind velocity may be good in some areas, may not be very good in some other areas, when we see that some areas may be eminently suitable given that they have uranium or other technologies, or low cost of capital, may be eminently suitable to have more nuclear power. Some countries which are blessed with a lot of gas may be able to generate power through gas which is relatively cleaner than coal…..

…. 2050 that many countries are talking of and that was often discussed in Paris, we could truly imagine a world where we could transition to 100% clean … world. And I think that is the day that I personally dream of. That is the kind of vision that will set our generation apart from the past or the future. That is the kind of commitment and passion that is required by all of us today to work towards creating a better world, to work towards creating a carbon-free world, to work towards really leaving behind a better planet for the next generation to live in.

And, I don’t know, it may sound pretty stupid at first call, but if you were to think it through, and if maybe a small group could actually start visualizing what this would mean. We already have the SAARC nations engagement and grid that we have planned, and we have been making rapid progress. We are today a net exporter of power. And we deal with Bangladesh. We deal with Nepal, with Bhutan. There is talk about working with Sri Lanka. We could even, in fact, now look at transmitting power to Sri Lanka, create a Ram Setu type transmission line, and instead of setting up a new power plant there, send some of our surplus power to Sri Lanka and light up Sri Lanka.

I still recall when on 1st January, 2017, we gave that additional power to Nepal; the kind of happiness that was seen across Nepal, particularly, in Kathmandu that they were getting power 24 hours a day, I am told was a very exciting moment for many people there, for the common man in Nepal. But we should seriously look at how this engagement, I mean we have the desert area in many parts of the Middle East, or Africa could be a great place to generate large amounts of solar power, given the availability of low cost land and a lot of sun over there, being closer to the equator also.

But it may be possible to look at large scale generation in some countries, transmission to other countries, time of day transmission, some times of the day the flow would be on one direction, the other time of the day it would be in another direction. And just like at Davos this year our theme was ‘Creating a Shared Future in a Fractured World,’ and I had personally suggested over there that the theme would have been even more appropriate if we had said ‘Creating a Shared Prosperity in a Fractured World.’ To my mind, a grid such as this would actually reduce the fractures and the fissures amongst countries, amongst nations, amongst people around the world, and would actually help all of the people of the world, the 6-7 billion people across the world, give a message of shared prosperity, a shared future, an engagement which transcends our boundaries and helps all of us collectively without worrying whether we are……

…. Commitment to make a difference to the future of energy, I hope the Ministry of Power and the Ministry of New and Renewable Energy, if at all they find some merit or something worth chewing on on this suggestion will at least start some rowing thoughts or some rowing research in this direction, take up the Leh-Ladakh project – don’t give it to PGCIL on nomination basis, bid for it. Actually, we have seen the Powergrid performance improve dramatically after we brought them into the competition. Costs came down 30%, their profits went up 30%. So, it’s a win-win for everybody. Their efficiency improved, the customers got better deal.

That’s the way we should look at the future of the sector going forward. I wish your Congress well. I wish you really come out with some very really good ideas. And if there is anything you can come up with for a better future for coal, and for cleaner coal, better utilization of carbon, carbon capture and utilization in a cost-effective manner, of course, I would be most delighted to support any such efforts.

Thank you very much.

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