Future of energy will be determined in India

The future of energy will be determined in India due to the huge energy demand in one of the world’s fastest growing economies, a distinguished panel of Ministers said at the ninth edition of the Asian Ministerial Energy Roundtable (AMER9) hosted on the second day of India Energy Week. Hosted by Government of India with International Energy Forum (IEF), AMER9 Roundtables discussed and deliberated on the important theme of mapping new pathways for energy security, inclusive growth, and energy transitions.

Opening the roundtable, Joseph McMonigle, Secretary General of IEF, said that India has become the world’s growth engine, with the GDP now rising at the fastest rate of any major global economy and energy demand expected to expand by more than any other country over the next 20 years, “So, it is no exaggeration to say that the future of our energy will be determined in India,” he said during the ministerial session titled “Adapting to an uncertain future: reshaping of global partnerships.”

The panel heard from His Excellency Hardeep Singh Puri, India’s Minister of Petroleum & Natural Gas, and His Excellency Dr. Sultan Al Jaber, President-Designate for COP28 UAE. In his first international visit since his appointment as President-Designate for COP28 UAE, Dr Al Jaber made the case for a pro-growth, pro-climate agenda to support an inclusive energy transition that leaves no one behind.

Praising India’s pro-growth and pro-climate policies, he emphasised the opportunities India offers. “How to adopt policies that are pro-growth and pro-climate at the same time, how to provide for a world that will consume 30 percent more energy by 2050 while protecting our planet, how to hold back emissions, not progress,” said Dr Al Jaber.

India, one of the fastest growing economies in the world, is aiming to become net-zero by 2070 and plans to produce 500 gigawatts (GW) by 2030. Dr Al Jaber noted the significant rise in investment in renewable energy in recent years and India’s drive to add 500 GW of clean energy by 2030, adding that the UAE was keen to partner with India and the world on advancing clean energies.

A lot of people, particularly across the global south, still do not have, or have very limited access to energy and their needs must be met as the transition to new energy takes place, said Dr Al Jaber. “We must empower the global south, where almost 800 million people have no electricity, in an inclusive energy transition. That is why we are calling for COP28 to be a COP of Action and a COP for All,” he said. “And we need to move from talking about goals to getting the job done,” he added.

India has become the world’s growth engine, with the GDP now rising at the fastest rate of any major global economy and energy demand expected to expand by more than any other country over the next 20 years

Minister Puri began his comments by noting that while the past century was marked by colonialism in Asia, the current century is marked by the growth story in Asia, vindicated by the way the Asian economies bounced back after the pandemic. “Some of the best solutions, including in the energy sector have come out from Asia,” he said.

Reiterating his point, the Minister said the Asian share of global GDP has risen from 38 percent to 45 percent currently and is expected to touch 50 percent by 2030. Asian economies which logged average growth of 6.5 percent in 2021 are expected to moderate to 4.0 percent in 2022 and rise to 4.3 percent in 2023.

Alluding to India, Puri said India’s energy demand growth is three times the global average. He said 60 million of India’s citizens visit the petrol pumps daily and the current consumption of crude per day is 5 million barrels. Furthermore, Puri said India’s capital expenditure allocation in the latest budget has increased 33.5 percent to Rupees 10 lakh crores with a significant outlay towards green energy. While stating that “our appetite for energy will rise,” Puri warned that the energy crisis has ripple effects on other sectors while climate change is a defining challenge of our times.

India, he said, is committed to climate goals and the country has taken concrete steps but “achieving net zero required global coordination, it requires a variety of solutions”. McMonigle lauded India for setting an example in managing the energy trilemma, of extending modern energy services to a growing population while also defending affordability and delivering a sustainable future.

Touching upon global energy security, McMonigle said it cannot be a zero-sum game with the winner taking it all at the expense of others. “We have seen some evidence of this recently in global gas markets. Energy security can be achieved by investing in new production and establishing trusted partnerships between producers and consumers,” he said.

The world relies on oil and gas for about half its energy needs even as the industry presses ahead with renewables energy. “We need to keep investing in oil and gas to support the global economy and protect the quality of life for everyone,” McMonigle said.

Stating that under-investment in oil and gas threatens energy security and stalls progress on climate goals, McMonigle pointed out that a cumulative 4.9 trillion dollars will be needed from now until 2030 to meet market needs, even if the growth in oil and gas demand slows down. Annual upstream oil and gas investment will need to hit 640 billion dollars in 2030 to ensure adequate supplies., he added.