Bid & Tender

News

India Continues to Meet Energy Demand While Delivering Environmental Improvements

Thanks to rising income, population growth, and urbanization, there is a considerable potential for energy demand growth in India, which is home to about a fifth of the world's population but uses only about six percent of the world's energy. India's energy demand is expected to more than double over the next 25 years, according to the IEA's India Energy Outlook. Even before COP21 in Paris, India announced a very ambitious renewable target: installing 175 gigawatts (GW) of renewable capacity by 2022, a quadrupling of renewable energy capacity in just seven years.

 

Prime Minister Modi has put in place policies to press ahead with the country's modernization, including a significant transformation of energy provision. An ambitious programme is underway to expand and upgrade the electricity sector, including a commitment to reliable and affordable power under the 24x7 Power for All initiative, as well as a significant push to deploy solar and wind power. Other energy-sector reforms focus on improving incentives to produce oil and natural gas, promote energy efficiency and increase access to modern fuels.

 

That said hydrocarbons remain at the core of India's energy policy. Crude oil consumption is expected to grow at a CAGR of 3.60 percent to 500 million tonnes by 2040 from 221.76 million tonnes in 2017. While natural Gas consumption is forecasted to increase at a CAGR of 4.31 percent to 143.08 million tonnes by 2040 from 54.20 million tonnes in 2017.

 

Meeting the Growing Demand

 

There is a total of 23 refineries in India and IndianOil operates 11 of them. They also have the distinction of operating the world's oldest operating refinery, AOD Digboi Refinery, which began production over 100 years ago in 1901 and is still running. The plant is currently undergoing modernization to prepare it for Euro 6 fuel production.

 

"If you look at the hydrocarbon market in India and oil and gas it is the second largest energy source after coal; coal is more than 50 percent, and oil and gas is at 35 percent," Sanjiv Singh, Chairman, IndianOil says. "According to projections including the BP Energy Outlook oil and gas will continue to remain the second highest energy provider for least the next two decades.

 

"India is heavily dependent on imported oil because we import nearly 84 percent of our requirement. We also import nearly 50 percent of our gas requirement, but there are a lot of policy incentive interventions that have been taken that we expect oil and gas production to improve."

 

Cleaner Cooking Fuel

 

One of the most significant growth areas in recent years is LPG with almost 10 percent. "We had a couple of special schemes such as Pradhan Mantri Ujjwala Yojana (PMUY) which is a very ambitious scheme by which within a span of three years we got nearly 70 million LPG connections for poor households," Singh says.

 

India is home to more than 240 million households out of which about 100 million do not have LPG for cooking and must rely on firewood, coal, or dung – cakes as a primary source of cooking. The smoke from burning such fuels causes alarming household pollution and adversely affects the health of women and children causing several respiratory diseases/ disorders. As per a WHO report, smoke inhaled by women from dirty fuel is equivalent to burning 400 cigarettes in an hour.

 

For more than 40 years, the Indian government's primary response has been to encourage the use of liquefied petroleum gas (LPG), a healthier but more expensive fuel, through a significant subsidy. To this subsidy, in 2016, the Bharatiya Janata Party-led NDA added a new initiative—the Pradhan Mantri Ujjwala Yojana (PMUY), which provides a free LPG connection to poor households.

 

"Today, we have LPG penetration of more than 93 percent," Singh adds. "That means 93 percent of Indian homes today have LPG connections, and we consume around 24 million tons a year."

 

Indian Environmental Drive

 

The increasing focus of climate change often puts an excessive burden on the so-called developing nations, including India and China, but as Singh explains India and IndianOil, are fully committed to the Paris Accord. "As a company, we are fully committed towards environmental issues," he says. "It's not only the way we do our business, but it is also what we do.

 

"One factor that affects both the refining and automotive sector is the commitment to What we do, I will give you just one or two examples. The whole sector, it's not only the refining sector is the commitment to move towards Euro 6 fuel by 2020."

 

Cleaning Transportation

 

Euro 6 and Euro 6 diesel is the sixth and current incarnation of the Euro emissions standard and was introduced on most new registrations in September 2015. For diesel, the permitted level of NOx has been slashed from 0.18g/km in Euro 5 to 0.08g/km.25 Oct 2018. The equivalent and identical standard, in India, is called Bharat Stage (BS-VI).

 

Until 2017 India was on Euro 4, or BSIV, but they decided to skip the Euro 5 specification and move straight on to BS-VI. "Within three years, the whole country decided to move to Euro 6," Singh explains. "While it poses a challenge to auto-manufacturers as well as to refiners, I think it very powerfully demonstrates our commitment towards the environment. It is being delivered with a lot of investment from the refiners along with a lot of execution challenge.

 

"We are trying to set up new process units within the operating refineries, but I'm happy to share that the deadline for this improvement of 2020 will be met. We are confident that all the refineries will be doing so. In fact, Delhi and the surrounding area have been supplying Euro 6 fuel for the past year."

 

Operating Challenges

 

Aside from the products produced another problem is the way the refineries are operated. Refining is traditionally a high-energy-consuming industry, in terms of energy, water consumption, and emissions. "We have been improving drastically year on year," Singh reports.

 

"We are working on a project to capture CO2 emissions from the stack, and I'm sure that we will be successful in doing so. If we succeed in this, it will be a game changer for all the refineries, being able to capture CO2 and use this CO2 commercially for other applications including enhanced oil recovery for upstream applications.

 

"We are also installing a 3G ethanol plant where we are going to make ethanol that can be blended with fuel. These are only a few examples, and they may look small, but they demonstrate a firm commitment for the company towards a cleaner environment."

 

BACK

Related News