Arvind Panagariya did not list the “draft national energy policy”, prepared by the Niti Aayog and circulated for comment on June 27, as one of the important achievements of his tenure as Deputy Chairman in the various interviews that I read, on the day he announced his resignation. Perhaps, because the document is still in draft form; perhaps, he did not have a major hand in its preparation. Whatever the reason, I am sure he will wonder whether, once finalised, this document will indeed catalyse change or suffer the same dusty fate that befell an earlier effort to develop an integrated energy policy by the erstwhile Planning Commission.
My own sense is that if the final version is little different from the draft that has been circulated, it will soon be shifted to the archives. For, while like so many other reports, it encapsulates well the problems and the solutions, it ducks the modus operandi for implementation. It does not define roles, responsibilities and accountabilities. It does not provide a timeline for delivery and there is no discussion on financing.
The authors might argue that their purpose was to define the issues, elucidate the preferred vision and recommend the policy required to realise this vision. It is now for the executive to put actionable flesh around these recommendations. If, indeed, this is their argument, then I would retort that our “energy problem” is existential in severity; that we do not have the luxury to define now and act later and that if, as the government’s think tank, Niti Aayog wishes to make a difference, it should extend its mandate unilaterally and map each of its policy recommendations against existing institutions of governance, and where there are mismatches or misalignment, offer suggestions for plugging the institutional lacunae.
The recommendations in the draft report are not new. They have been made before. This does not mean the report contains nothing or little of value or interest. On the contrary, it is good that one more government document has emphasised the importance of pegging India’s energy policy on the following three essential verities.
One, India’s per capita energy consumption may be a fraction of the per capita energy consumption of the developed world and, indeed also that of China, but it will be among the most severely impacted by global warming. It should demand “differentiated responsibility” from the international community in managing and mitigating the existential risk arising from this development. But, in parallel, it must push its economy on to a low carbon growth trajectory. Two, its energy policy must, in consequence, focus on increasing the share of renewables (solar, wind, bio) in the energy basket and on greening fossil fuels (oil and coal). And three, it must leverage technology and innovation to render renewables affordable and accessible.
The report has modelled alternative energy futures based on differing assumptions regarding economic growth, energy demand and supply etc but they all converge to the same conclusion. India must fast-track the implementation of a green energy agenda. The problem with the report lies elsewhere.
First, the “something for everybody” narrative dilutes the centrality of the green message. The report’s vision for 2040 calls for affordable energy, high per capita electricity consumption, access to clean cooking energy, low emissions, security of supply and universal coverage. There is a clean energy thread running through these components. But its recommendation for the policy interventions required to achieve this vision is a patchwork of clean and not-so-clean initiatives. That is, managing energy consumption, energy efficiency, production and distribution of coal, electricity generation, transmission and distribution, supply of oil/gas, refining and distribution of oil, and installation, generation and distribution of renewables.
How will the government square the vision of clean energy with the circle of augmenting supplies of unclean fossil fuels (coal, oil, and gas)? How will it access clean technologies like carbon capture and sequestration, cellulosic biofuels (so that there is no competition with agriculture) and hydrogen fuel cells, if it does not make a singular effort to counter the systemic bias towards technologies for enhancing hydrocarbons? I am not suggesting that the latter is not important. On the contrary. Coal, oil and gas are the drivers of our economy and we must do our utmost to secure their supplies. What I am suggesting is that a separate system be created to enable the development and distribution of cleaner fuels and that policy interventions be directed to slowly but inexorably enhance the importance of the latter to the diminishing significance of the former.
Second, there is no discussion on the institutions of implementation of the policy. The report suggests that the list of policy to-do’s should be monitored by a committee of secretaries chaired by the CEO of Niti Aayog and the process supervised by a steering committee chaired by the PM and comprising members of the cabinet. This may be a necessary requirement but it will not be sufficient.
Anyone with even a superficial understanding of governance knows there is currently no institutional platform for mediating the complex of vested interests and stakeholders engaged with different aspects of the energy sector. There is a misalignment between the horizontally structured, siloed central ministries and the vertically layered division of responsibilities between the central, state and municipal governments. This is the main reason why it is difficult to translate policy into action. Take, for example, shale oil. To harness these resources, the central Ministry of Petroleum will need to bring the central ministries of water, chemicals and environment, their counterpart state government departments and the landholders around the same table. There is no mechanism for doing so.
My hope is that Niti Aayog will supplement their current report with a second document that will offer suggestions for the creation of such a mechanism and an institutional design that will clarify lines of accountability and authority and balance the needs of development, politics and sustainability.