5th edition of the EU-India STI Cooperation Days, 12-13 November 2014, Chennai, India

EU-India: Cooperation Opportunities in the field of Energy Reserach

Girish Sethi

TERI, New Delhi

Content

• India: Energy Snapshot and Projections

• Industry sector and energy consumption

• Energy Research and Technology Cooperation

Opportunities

• Energy Efficiency in SME sector

• Smart Grids

• Conclusions

2

3

India’s Energy Snapshot

Low per capita energy

consumption: 596 kgoe (2011/12)

(World average 1802 kgoe per

capita)

Per capita consumption of

electricity 884 kWh/annum

(2011/12) (World average: 3044

kWh/annum)

80% of rural India dependent on

traditional fuels for cooking

Fossil fuels account for about 70%

of the primary energy supply

Global

Local

Sustained economic growth and social development

require increasing energy use 3

2nd largest Population

3rd largest coal producer and

consumer

4th largest energy

consumer

31.4% of the population relies on kerosene for lighting

(Census, 2011)

71.5% rely on traditional biomass for cooking (Census,

2011)

High oil imports (76% in 2011)

Increasing coal imports (23% in

2011)

Energy demand has doubled in the last

10 years

3

Energy and Related Challenges

Large under-served, yet aspiring, population

Energy demand drivers accelerating rapidly

• Income levels

• Urbanisation

• Access to markets

Financial

Consumer goods

• High levels of mobility

• Digitally connected world

Stagnating, if not declining, conventional energy

resources

Abundant, under-developed, renewable energy sources

4

5

Energy Access Lighting

It has been estimated that the annual expenditure

on kerosene for lighting by off-grid and under-

electrified households is around USD 2.2 billion.

Out of this, around USD 1.8 billion is spent by

rural households

Cooking

Inefficient burning of biomass in traditional

cookstoves requiring higher quantities and

leading to pollution

Indoor air pollution from burning of solid fuels

increases health risks

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

IND

IA

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No lighting

Any other

Other oil

Solar energy

Kerosene

Electricity0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

IND

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No cooking

Any other

Biogas

Electricity

LPG

Kerosene

Coal, Lignite,Charcoal

Cowdung cake

Crop residue

Firewood

Source: Census 2011 5

• Primary energy supply increases from 717 (2011/12) mtoe to 1950 mtoe (2031/32);

coal followed by oil remain the two dominant energy sources

• Final energy demand rises from 549 mtoe (2011/12) to 1460 mtoe (2031/32), an

increase of about 2.7 times in 20 years

• Industry sector continues to remain the major energy consumer ( 40%- 48%), and

the share of transport sector rises from 16% (2011/12) to 25% ( 2031/32)

Primary Energy Requirement Final Energy Demand

Source: TERI’s MARKAL Model Results 6

0

200

400

600

800

1000

1200

1400

1600

2011/12 2016/17 2021/22 2026/27 2031/32

Mto

e

Agriculture

Commercial

Residential

Transport

Industry

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2011/12 2016/17 2021/22 2026/27 2031/32

Mto

e

Traditional Biomass

Liquid Biofuel

Tidal

Geothermal

Waste to Energy

Biomass based Power

Wind

Solar

Hydro

Nuclear

Natural Gas

Oil

Coal

An Unambitious, Unsustainable Future

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7

Primary Energy Growth – Alternate scenarios

• The ESM reflects a saving

of 18% while the ESA

reflects a saving of 26% in

2031/32 when compared

to the RES levels

• The share of new

renewable energy

increases to 3% in ESM

and 7% in ESA compared

to 2% in RES in 2031/32

• The share of fossil fuels in

the RES stands at 82%,

while in the ESM it drops

to 79% and in the ESA to

75% by 2031/32

Source: TERI’s MARKAL Model Results 7

0

200

400

600

800

1000

1200

1400

1600

1800

2000

RES ESM ESA RES ESM ESA RES ESM ESA

2011/12 2021/22 2031/32

Mto

e

Traditional Biomass

Liquid Biofuel

Tidal

Geothermal

Waste to Energy

Biomass based Power

Wind

Solar

Hydro

Nuclear

Natural Gas

Oil

Coal

8

Electricity Sector: Projections

Share of RE in the generation capacity mix rises from 9% (2011/12) to 23% in ESM

and to 31% in ESA as compared to 17% in RES (2031/32)

Share of coal based generation capacity reduces from 52% (2011/12) to 50% in ESM,

32% in ESA, as compared to an increase to 62% in RES (2031/32)

Source: TERI’s MARKAL Model Results 8

0

100

200

300

400

500

600

700

800

900

1000

RES ESM ESA

2031/32

GW

Tidal

Geothermal

Waste

Biomass

Solar thermal

Solar PV

Wind Offshore

Wind Onshore

Nuclear

Hydro

Diesel

Gas

Coal

Industry Sector: Present Situation

Indian industry sector comprises of large and MSME (micro, small and medium enterprises)

units

Industry sector accounts for about 50% of total commercial energy consumption in India

(2010/11)

Large Industry sector

New plants: Mostly adopt energy efficient/state of the art technological options as per the global standard

on their own. e.g. cement, fertilizer, etc.

Existing/old plants: Options exist for energy efficiency improvements

PAT scheme (market based mechanism) focuses on 335 Designated Consumers covering 7

sub-sectors to improve their energy efficiency levels

Target reduction - 5.7%

MSME sector

29 million enterprises

Existence of many energy intensive industrial clusters

Majority of units use obsolete technologies and unskilled manpower

9 9

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Industry Sector: Projections

Energy demand in the sector rises from 221 mtoe ( 2011/12) to

697 mtoe (2031/32), with around 60% share of coal in the RES

The ESM reflects a saving of 12% (2031/32) and the ESA that

of 17% (2031/32) in comparison to the RES

The ESA sees a drop in the usage of coal and petroleum fuels

with gas being used as a bridge fuel

Source: TERI’s MARKAL Model Results 10

0

100

200

300

400

500

600

700

800

RES ESM ESA

2031/32

Mto

e

Biomass

Grid Electrcitiy

Petroleum Products

Natural Gas

Coal

Industry: Key future actions for reducing energy usage

Accelerated adoption of Energy Efficient Technologies and Practices

‘Deepening’ and ‘Widening’ of PAT scheme to cover maximum number of large industrial units (also include other sectors covered under the EC Act)

Large scale expansion of Demand Side Management (DSM) based programs for lighting and other appliances (involving Power Distribution Companies and Regulatory Commissions)

Promote manufacture of energy efficient products/appliances (e.g. efficient ceiling

fans, agricultural pump-sets, LED lighting, ACs, building materials, etc)

Developing long term “sector and cluster specific” programs focusing on technology

development, demonstration and adoption in MSME sector

Structured / Need based training to enhance the skills at different levels (workers,

supervisors, entrepreneurs )

11 11

Energy Cooperation opportunities – Examples from two key areas

Energy Efficiency in SMEs Smart grids

12 12

SMEs: Dominating the EU and Indian Industry Landscape

Constitute 95% of world’s total enterprises, 60% of total private sector employment

Over 99% of total enterprises in Japan are SMEs

In EU-27, 99% of all enterprises are SMEs, contributing 58% to value added

In India, 29 million units employing 100 million people

Accounts for 45% of manufacturing output and 40% of India’s total exports

Manufacture over 6000 products

Many energy intensive sectors such as foundry and forgings, glass and ceramics,

brick, textiles, dairy and food processing and so on

Clustering of industry: over 200 energy intensive manufacturing clusters exist

Deploy obsolete technologies and unskilled manpower

Scope to save energy by adoption of Energy Efficient Technologies (EETs),

Renewable Energy Technologies (RETs) and Best Operating Practices (BOPs)

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Indo – Swiss Technology Cooperation: Joint RDD&D Program in SMEs: Case study #1

Conventional coal fired

pot furnace

Recuperative natural gas fired

pot furnace

GLASS SECTOR

14 14

Conventional Cupola Divided Blast Cupola (DBC)

FOUNDRY SECTOR

Indo–Swiss Technology Cooperation: Joint RDD&D Program in SMEs: Case study # 2

15 15

Promoting Smart Grid initiatives in India:

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Relevance

• Fourth largest power generation economy

• ‘No access’ to electricity to around 35% of population

• High energy and peak deficit

• Increasing share of RE, an increased share of RE requires smarter systems to manage it efficiently and ensure its stability & reliability

• Need for improvement in quality and reliability of supply

• National Mission on Electric Mobility: target of 6 Million EVs by 2020

Key smart grid Functionalities

• Remote connection/disconnections

• Changing consumer behavior through differential pricing, e.g. Demand Response

• Outage management through smart infrastructure

• Integration of renewable energy sources

• Distributed generation

• Consumer protection

Indo-Dutch Cooperative project – a proposal

17 17

Focus state:

Karnataka ; Preliminary interactions with a state

DISCOM and state electricity regulatory commissions

carried out

Objective of the study is to assess the

existing priorities of the utility and Smart Grid

functionalities that will improve the

performance of the distribution system.

E.g. Automated metering infrastructure

(AMI), outage management system,

empowering consumer for load

management, etc.

The study would lead to development of a

guiding document for the utility for

implementation of Smart Grid solutions

in a phased manner

EcoGrid EU – Large Scale Demo

Large-scale Smart Grid Demo in Denmark

Goal: integrate demand-side flexibility into the Electricity Markets.

2000 Customers (Residential and Industrial) involved.

PowerMatcher is one of the response technologies demonstrated.

TNO is a key partner

Full-scale demo in the complete Bornholm distribution system, owned

and operated by the local DSO, Østkraft.

Many areas for technology cooperation between India and EU in

the energy field

Need to focus on specific topics in different sectors (e.g. energy

efficiency, RETs , product development, etc.)

For long term sustainability, promote joint programs for Research,

Development, Demonstration and Deployment (RDD&D) in

identified fields

R&D (innovation) of EE/RE technologies are often happening in

developed countries (e.g. EU) while D&D (adoption/customization) is

needed in developing countries (e.g. India).

Collaboration between EU and India through various stages of

innovation process will be pivotal to building of technological

capacities in India

To summarize ….

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Other key points ..

Technology Cooperation projects to be collaborative and can be based on local needs and involve local actors (including academic and research institutes)

Sharing of knowledge and expertise by foreign experts in such projects vital for their success

Ensure longer term projects with emphasis on customization and dissemination

Bilateral and multilateral funding mechanisms can play an important role in promoting cleaner technologies

EU, WB, bilateral development programs of different countries, etc

Other mechanisms like GEF and newly established CTCN

Such projects should be focused on specific applications/sectors

Pre-feasibility and detailed studies to precede demonstration projects

Include other supportive actions in such programs (awareness, webinars, workshops etc.)

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5th edition of the EU-India STI Cooperation Days, 12-13 November 2014, Chennai, India

Email: girishs@teri.res.in