The Elephant's Great Thirst

Posted on December 26, 2008
Posted By: Michael Kugelman
This is a story about a nation with a voracious appetite for energy.

This country is one of the world’s top energy consumers. Given its modest supply of indigenous resources, it must satisfy its energy hunger abroad. This billion-person nation presently imports about two-thirds of its oil -- a number projected to rise to 90 percent by 2030.

Its pursuit of energy resources overseas is spearheaded by its powerful oil and gas companies, which invest billions of dollars in assets that in turn generate vast quantities of gas and oil. Last year, its foreign ministry established an energy security division. Today, the country’s government supports its energy investments with robust “energy diplomacy,” which extends from Central Asia to the Middle East, Africa, and Latin America.

Given that its energy interests are truly global, exposing the country to different types of threats-from political instability to natural catastrophe-this nation’s navy is undergoing a dramatic transformation: one that will enhance its power projection capacities and convert it into a blue-water force. Is this a tale about China?

No. It’s an account of India.

India is currently the world’s fifth-largest energy consumer, and is expected to vault to third place by 2030-behind only the United States and China. This soaring energy demand, coupled with low domestic supply, has generated a veritable foreign addiction: India now consumes more imported oil than China or the United States.

India’s rapidly rising energy needs, and its inevitable forays overseas to satisfy them, have major implications for the country’s long-term economic development. In 2006, New Delhi’s Planning Commission projected that India must sustain an 8-10 percent economic growth rate over the next few decades in order to end poverty and meet human development goals. However, to maintain these rates through 2031-32, the commission judged that India must triple its primary energy supply and quintuple its electricity generation. In effect, both India’s prodigious economic growth and the well-being of its citizens are at stake-so don’t expect India to tone down its global energy hunt anytime soon.

Nonetheless, for some observers, the intensity of India’s global search for energy provokes anxiety. Human rights activists point out that New Delhi’s energy diplomacy entails close ties with repressive energy-rich regimes such as Burma and Iran. Some free-market supporters label India’s acquisition strategy as mercantilist and predatory, and perceive it as a potential threat to the world’s energy resources. Of course, the very same complaints are often made about China.

What can be done to help India meet its energy requirements while also weaning it off its foreign addiction to hydrocarbons? Don’t expect the recently concluded U.S.-India civil nuclear deal to be of much help-the nuclear fuel it provides will fall far short of meeting India’s soaring energy demand.

One important step is to support-through a combination of local and international capital and technology-the development and sustainability of India’s indigenous hydrocarbons. In the last few years, natural gas has been discovered in the Bay of Bengal and oil deposits unearthed in India’s northwest-major finds that create opportunities for future exploration and investment. Coal-India’s primary domestic energy source-should not be overlooked, and one fledgling U.S. Department of Energy project-which aims to help India develop clean-coal technology-is encouraging.

Given the grave environmental consequences of massive hydrocarbon consumption, India must also intensify investment in its non-hydrocarbon resources. The U.S.-India Energy Dialogue, which facilitates discussions on energy efficiency and renewables, is one useful tool to spark such investments. India’s solar and wind energy sectors hold great promise; the latter is already the world’s fourth-largest.

Such efforts will not cause India’s overseas energy dependence to disappear overnight. Still, they will lay the foundations for an energy-independent future-one in which New Delhi may turn to Rajasthan instead of Rangoon for energy needs, but also one that will sustain India’s strong economic growth and help lift its massive population out of poverty.

Authored By:
The writer is program associate with the Asia Program at the Woodrow Wilson International Center for Scholars in Washington, DC, where he is responsible for research and publications on South Asia. He has published a variety of material on energy issues in South Asia, including the July 2008 monograph “Foreign Addiction: India’s Energy Security Strategy” and the coedited book Fueling the Future: Meeting Pakistan’s Energy Needs in the 21st Century

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December, 27 2008

Ferdinand E. Banks says

I pointed out a few years ago, probably in my energy economics textbook, that if China were to cut back on its imports of oil, India would take up the slack. Of course, when the present macroeconomic mess is cleaned up, then the rest of the world can look forward to a traumatic escalation in the import of oil by these two 'giants'. Note, import: the domestic production of oil may increase slightly, but everything considered it will not suffice to provide these countries with anything close to 'independence'.

I didn't know that there was a U.S.- India energy dialogue. As we used to say in the army, that sounds like something for the birds. One thing here is certain though: if India turns to Washington for energy advice, they will hear a few things that they should not hesitate to ignore.

December, 30 2008

Len Gould says

I love this sequence - "Some free-market supporters label India’s acquisition strategy as mercantilist and predatory, and perceive it as a potential threat to the world’s energy resources. Of course, the very same complaints are often made about China. "

Rats, eh? They're using OUR techniques to compete for OUR oil, are they? "Threatening" the "world's energy resources" indeed. Somehow something tells me that most of the people who need to "get" the black humour in there, won't. Too bad. BAU.

India should clearly rapidly develop its solar thermal industry. It's northwestern desert areas are perfect. Modify the DESERTEC strategy, ideal (though naive on my part i suspect) would be to do so as part of a regional grid so the developments become a base for electricity generation for Pakistan, Bangaledesh, perhaps even Iran and Afganistan. Big task, but no bigger than the same would be using coal, gas or nuclear.

December, 30 2008

Anantharamiah Raja Rao says

If one takes the per capita energy figure then India would be far below many many countries and so it would be wrong to focus on India in the way this article does and this is because India is a large country population wise. Indian citizens have as much a right to a good life as anybody else on this planet. What developed countries should also do to help is to assist India with their 'advanced technologies' to 'determine' what level of energy consumption per head is desirable to target for and how to achieve it in an environmentally friendly way. India does not want to consume as much energy per head as the USA or any other developed country.

December, 30 2008

Don Hirschberg says

Raja Rao comments: “Indian citizens have as much a right to a good life as anybody else on this planet.” And: “India does not want to consume as much energy per head as the USA or any other developed country.” It strikes me that these two statements are contradictory. As I understand the situation in India hundreds of millions have no electric power service, the rest have to put up with daily power shedding. Hundreds of millions (of the 1.1 billion) cook their meager meals with twigs. If Indians have as much right to a good life as anybody else doesn’t that include 24 hour electric service, running water and even air conditioning in a country much of which is subject to beastly high temperatures? Doesn’t this suggest using as much energy per head as developed countries? Despite all the their politician’s green talk I think I have seen that about 90% of India’s electricity comes from coal. Some readers might know that I find the dilemmas facing India are merely corollaries of THE problem of the planet: too many people. Energy, water, food problems are merely corollaries. Who will say it?

December, 31 2008

Peter Boisen says

The logical long term reply to Mans's need for energy is to step by step reduce the reliance on finite resources (fossil fuels and also fission power feedstock) and instead use renewables. The technology is already available, meaning that the supply is a matter of cost. We only need to recover a very small fraction of the continuous supply of direct or indirect solar power.

Gradually getting rid of fossil fuels and fission power also means a gradual reduction of undesirable by-products - emissions, and difficult to handle waste products. With increased penalties on the by-products when using finite resources, the costs for renewable energy become become more competetive.

IIf we elect politicians which provide sufficiently severe tax penalties on the use of finite resources, renewable energy has a bright future.

Available resouces of biomass not suited for use as food or fodder should be conserved for two purposes - supply of fuels for mobile applications, and also as feedstock for the chemical industry. Burning biomass to generate heat and electric power is not a sound option as we could generate electric power in so many other ways. High efficiency use of biomass means avoiding long distance transports of biomass with a high moisture content, and the use of highly efficient conversion technologies. Biological processes often have an efficiency edge over thermochemical processes, and need not necessarliy be handled in very large scale biorefineries.

Biomethane is an example of a product which can be produced at high effciency in relatively small anaerobic digestion plants using almost any kind of biomass (lignocellulosic matter is the exception, and better handled via gasification followed by methanation). The residuals are well suited for use as fertilizer, or as a feedstock for the chemical industry.

December, 31 2008

Don Hirschberg says

Peter, there is quite a difference between wishing and having a proposal. Getting rid of both fossil fuels and fission is maybe the most radical proposal yet made. Today that would leave hydroelectric as the only significant source of energy we have today. Despite decades of subsidies and tax benefits Wind, wood, waste, geothermal, all solar, and others now give us less than three percent of our energy needs. Your posting includes no numbers. Any energy proposal without numbers is likely to be only this week’s solution to the energy dilemma, and might just as well be daydreaming. (Not that I am against daydreaming.) Yet cost is of the essence. If billions of people go without electricity today because coal fuelled plants are too costly, how are we to give them power from more expensive solar plants which need conventional backup because the sun does not shine on demand? Today about a billion people were on starvation or severely deficient diets. That’s more than three times world population of a couple thousand years ago. Progress? Given the 6.7 billion people on earth, and increasing at about 0.1 billion per year, I see no combination of proposed solutions that will solve the energy dilemma.

January, 01 2009

Ferdinand E. Banks says

Don, cost is both the top and the bottom line. That's why talk about it is so unpopular or screwy.

January, 06 2009

Malcolm Rawlingson says

Peter, All the renewables ideas are good - on paper - but what you are proposing is on a scale that is vastly insufficient. There is enough latent heat in the oceans to power all of civilization for ever. But it is in the ocean. There is more solar energy output from the Sun every second than the human race has used in its entire history on earth but most of it misses the earth and what is left is only available on the side of the earth where the Sun is.

it is pointless making these assertions - as desirable as they are - without saying exactly HOW this is to be accomplished.

Yes you CAN replace all of fossil and nuclear with wind power. But there would be hardly a square inch of land or ocean left for anything else. One would require hundred of millions of windmills to do that plus associated storage capacity.

Yes you CAN replace all of fossil and nuclear with solar panels but most of the earth would be covered in photovoltaic arrays and the storage systems to store the energy at night. Remember there is no fossil or nuclear plant to prop up the grid when solar and wind are not operating.

Of course you could do without storage if you want your citizenry to go to sleep at dusk and not operate factories or use any energy at night. They would not be able to inhabit cold countries so we would be able to convert all of Canada and Russia to wind farms displacing the population to the tropics...Ok I really like that idea but there are SOME people who like the cold. I guess they can be trained to maintain the fifty million windmills.

And of course there is enough binding energy in the atoms of uranium and thorium to power the earth for ever. Maybe we should pursue that. Since it comes from the nucleus of the atom - hey let's call it nuclear energy.

Let's call it UNLIMITED nuclear energy available 24 hours a day seven days a week using a few square miles of the earths surface.

I like that idea much better but you can move me to the tropics any time you want.


January, 06 2009

Anantharamiah Raja Rao says

I want to respond to Don Hirschberg's coment. It certainly means that all Indians should have access to 24 hour electricity but does not repeat does not mean that they should consume as much kWh as the American does. I think the meaning is fairly obvious - how many kWh does a person in India with its atmospheric conditions (Don obviously has not visited India otherwise he would not have commented on the beastly high temperatures - it is nowhere near what is experienced in Texas say where the airconditioning load is so high) need? Surely not as much as 20000 kWh per head as consumed in the USA. I am reminded of the famous Leo Tolstoy story - how much land does a man need?

January, 07 2009

Peter Boisen says


We seem to agree on one point - that the costs charged for different types of energy will influence the choices made. The cost for a consumer consists of two parts - the money paid to the supplier, and the tax paid. With increased taxes on finite resources the renewables become more competetive. Taxes collected can be used for investments in developing renewable resources.

You request numbers rather than opinions. Not sure that all the arguments presented on this site are always supported by numbers, but I will make a small effort by looking at electric power generation using Eurostat data for the year 2005 (EU-27, unit TWh). Patterns country by country deviate substantially from the European total. To illustrate this point I have within brackets shown the Italian data.

Nuclear - 998 (0) Coal - 940 (44) Gas - 694 (155) Hydro - 307 (36) Oil - 139 (47) Biomass - 80 (6) Wind - 70 (2) Pumped storage 34 (7) Geothermal - 5 (5) Solar PV - 1.5 (0) Total - 3309 (304) Whereof renewables - 464 (50)

In Denmark (practically without hydropower) 10.6 TWh out of a total 36.3 TWh come from renewables, i.e. just under 30 %.

Although we certainly have a long way to go I believe that the Danish numbers demonstrate a substantial renewable potential even without hydropower or large forest resources. The Italian numbers show that a nation can survive without nuclear power, also that the geothermal option can provide more than a nominal contribution.

January, 08 2009

Len Gould says

Peter: Are you sure your numbers include Italy's imports of nuclear electricity from France? Looks to me like just locally generated electricity.

Malcolm: Regarding "Yes you CAN replace all of fossil and nuclear with wind power. But there would be hardly a square inch of land or ocean left for anything else." -- I've been evaluating current technology solar-thermal-with-storage regarding land use. At 40% collector area to ground area and 15% solar to electrical efficiency, the area of 2.2 Twh per km² insolation Sahara desert required to replace the entire world's total energy use looks like the following calculation.

-- World annual energy consumption all sources 2007 was 11099.3 million TOE. (BP Statistics) -- The conversion factor used by the IEA for electricity is: 1 TWh = 0.086 Mtoe. -- World annual energy consumption 2007 was 11099.3 million TOE / 0.086 = 129,062 Twh

-- 2.2 Twh x 15% station effic. x 40% land effic. = 0.132 Twh per km²

-- World -- 129,062 / .132 = 1,000,000 km², or a square area 1000 km on a side. or 100 areas 100 km on a side. assuming North America = 25% of all world energy 2007, then -- N America -- 129,062 / .132 x .25 = 250,000 km², or a square area 500 km (310 miles) on a side. or 100 areas 50 km (31 miles) on a side. -- Notes: some rounding up, some sources (Solel) state 0.100 Twh per km²

Solel Faq

BP Statistics - Primary Energy Consumption

January, 10 2009

Graham Cowan says

The thing about renewable energy powering the world is not that it can't happen but that those who insist that it, and not nuclear, must do so are confident that it will not happen, and they will be able to continue to live off natural gas tax revenue. (The fossil fuel interests are not the oil companies.)

January, 13 2009

Don Hirschberg says

Raja Rao, I don’t know why you compared Indian temps with those of Texas, but your comment made me curious enough to do some quick and dirty comparisons. You said: “Don obviously has not visited India otherwise he would not have commented on the beastly high temperatures (in India) - it is nowhere near what is experienced in Texas…” My Funk & Wagnalls says” The hot season, beginning about the middle of March and extending to the onset of the S.W. monsoon reaches its most oppressive stage during May when temperatures as high as 125 F are commonly recorded in central India.” Then I compared some Texas temperatures with those of some Indian cities. I arbitrarily counted months when the average daily high was 90 F or more. Dallas has 3 such months, as does El Paso. Del Rio has 4 of these hot months. In India Mumbai (Bombay) has 7 months, while both Kolkata (Calcutta) and Madras each have 8 such months.

You mention 20,000 Kwh/head/year. My wife and I live in an all-electric house, electric heat (heat pump) air conditioning, water heating and cooking. We use about 8,000 Kwh/head/year. Your number could be misleading as it would include industrial and commercial usage.

January, 21 2009

Anantharamiah Raja Rao says

Responding to Don's comment. I have lived in Mumbai and Delhi and have spent the last summer of 2008 in Austin Texas and without quibbling about temperature figures, can say that it was much easier to walk about oudtoors in Mumbai and Delhi than it was in Austin. This whole paper was on the electriicity consumption of the country as a whole and not only about domestic consumption. The point I was trying to make and it seems did not succeed is that as a country it is not necessary to reach the average consumption levels of the USA for a good life and it would be in the interest of the internatiional community to help India in this endeavour.

January, 29 2009

Tejas Kadia says

Michael check your facts before writing. "India now consumes more imported oil than China or the United States."

Absolutely false. The US imports about 10 million barrels of oil per day. India imports about 2.5 billion per day.

Anyway, India is making significant headway in solar and wind power. Do you think they want to be dependent on oil imports alone? The Government of India isn't stupid. Mr. Rao is correct. The per capita usage will always be lower in India even as that country continues to grow its economy.

January, 29 2009

Tejas Kadia says

*2.5 million barrels per day not billion.

You can even check the CIA factbook if you don't believe me.

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