Energy map reveals rising dependency on coking coal

NEW DELHI: For those drawing consolation from domestic coal reserves for underplaying the impact of international oil prices on the economy, here is a reminder.

A new National Energy Map for India, prepared by the Energy and Resources Institute, along with the office of the principal scientific advisor, has predicted that in a high growth scenario, import dependency for coking coal will increase to 85% in 2031.  The figure amounts to 2,475 million tonnes of coal imports, creating the need for securing supplies. Import dependency, in fact, will be across all the energy sectors, be it crude oil, coal or even nuclear, but as R Chidambaram, principal scientific advisor to the Union government, puts it, “In the short term, we need the world, but in the long term, the world will need us (for nuclear technology).”

The high growth scenarios assume 10% GDP growth uniformly over the modelling timeframe of 2001-2031. The dependence on foreign coal reserves, and thereby insulating the economy from international fluctuations, stands reduced 1% to 84% in case highest efficiency gains are brought into the economy.

Assuming 8% GDP growth in the business-as-usual scenario, this dependency reduces to 75%, but as the report points out “even at the current coal price of $60 a tonne for imported coal, this would translate to an enormous drain with the country’s foreign exchange outflow on coal import expected to reach around Rs 4,00,000 crore in the business as usual scenario in the year 2031”.