Why India is Turning to Coal

Frank Clemente Ph.D.Senior Professor of Social Science & Energy PolicyPenn State Universityfac226@psu.edu

The Power of Coal: If India Did Not Use More Coal

To meet projected demand, and replace projected incremental coal based electricity generation, India would have to obtain more than 13 Tcf of NG, build 210 nuclear power plants or construct the equivalent of

400 Hoover Dams

1,770 1,736

1,509

1,586

The Logic of India’s Continuing Reliance on Coal

“There are no alternatives to hydrocarbons in the foreseeable future” M.Economides, Professor of Engineering, University of Houston, 2008

“Clean coal technology is one of the most promising routes for mitigating emissions—India [will] benefit” IEA, 2007

“Access to electricity is strongly correlated with every measurable indicator of human development” -Berkeley Science Review, 2008

“India has more people without adequate access to energy than any country in the world” -National Resources Forum, 2008

“Removal of poverty is the greater immediate imperative than global warming” P. Ghosh, Secretary of the Environment, India,2007

The World Bank Agrees

● “India needs much more power in a short time frame to continue its economic development.”

● “India still must rely on (coal) to meet growing demand”

● “Gas-based power is not a viable alternative …not enough natural gas is available …and the power it generates is too expensive”

● “Wind power still has limited reliability and its higher cost …makes it unsustainable for meeting large scale demand”

* July,2008

5

India Faces Rampant Growth

The Context and Scale of Growth

Current

Growth

By 2030

7

17.1%

0.5% 0.6% 0.8%

10.2%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

20.0%

Population (1.15 Billion)

Oil NG Uranium Coal

% o

f W

orl

ds

Pro

ved

Res

erve

sCoal is India’s only Energy Advantage

India’s Share of the World’s Energy Reserves

“Coal is expected to be the mainstay of power generation in the years to come” India’s 11th Five Year Plan (2007-2012)

What Coal Conversion Will Do For India

Electricity – consumption will nearly triple by 2030 to almost 2,800 terawatt hours (TWh).

Liquid fuels – India will have over 150 million vehicles in 20 years.

Natural Gas – demand will increase 170%.

Dimethyl Ether (DME) – a completely sootless fuel that can greatly reduce dependence on wood and dung in household cooking.

Petrochemicals – ammonia, formaldehyde, ethylene, propylene, methanol production will add significant value to Indian economy.

Manufacturing – Energy sources to make iron and steel as well as non-metallic goods, including cement and soda ash.

Coal is the Cornerstone of Energy in India

Coal:39%

2005

Other fuel: 61%

2030

Coal:48%

Other fuel 52%

By 2030, the 1.5 billion people in India will depend more on coal for energy than any country in the world – except for the 1.5 billion people in China.

10

Access to Electricity and the Quality of Life

Survive Childhood

LiveLonger

DrinkCleaner Water

EatBetter

Are BetterEducated

Under Five Death Rate/1000

Life Expectancy (years)

Access to Improved Sources

(%)

Under Nourished(%)

Literacy Rate (%)

People in Societies with Greater Access to Electricity:

Coal’s Track Record in India

Coal accounted for 70% of India’s increase in electric power generation from 1990-2005

• Access to Electricity Increased 30%• GDP Increased 124%• Food Production Increased 27%• Primary Grade Completion Increased 31%• U.N. Human Development Index Increased 19%

• Abject Poverty Decreased 10%• Fertility Rate Declined 26%• Undernourishment Fell 20%• Malaria cases declined 12%• Number of Illiterate Adults reduced by 25%

Enhancing the Quality

of Life

Reducing Despair

The Scale of Latent Demand for Electricity in India

Millions of People in India Toil in An Bleak World

Removal of poverty is the greater immediate imperative than global warming” P. Ghosh, Secretary of the Environment, India

We are at the beginning of the road: India’s Electricity Consumption per Capita Compared to Other Nations

Source: United Nations

India Will Increasingly Rely Upon Coal for Electricity Generation

Using Dimethyl Ether (DME) from Coal as a household cooking fuel will save millions of lives

DME derived from coal is a highly efficient fuel for cleaner household cooking

DME is soot free gas, with reduced Nox and Sox emissions

DME from coal could replace harmful dung and wood cooking, reducing both morbidity and mortality rates

DME from coal could replace LPG, a common cooking fuel which fluctuates with world oil prices

See: Larson and Young, Energy for Sustainable Development, 2004; and Goldberg et.al, Energy for Sustainable Development, 2004

Why Indian families need more DME from coal

1. 668 million Indians still rely on wood or dung for cooking

2. The concentration of particulate matter in household air is 2,000 microgrammes per m3 - compared to 150 in U.S.

3. Women and children are especially impacted and account for 400,000 premature deaths per year

4. Household use of biofuels accounts for about one fifth of the blindness in India

“2.5 million women and children in developing countries die prematurely from breathing the fumes from biomass stoves” (World Health Organization, 2007)

The Search for a Better Life: India’s Five Year Plan’s Goals Confront Stark Reality

Goal in the Five Year Plan Current Situation

Reduce poverty by 10% 360 Million people earn less than a dollar per day

Lower the gender gap in literacy 52% of Women cannot read

Reduce infant mortality rate Infant mortality rate of 56 Compared to 4 in Germany

Provide clean drinking water 140 Million people have no improved water supply

Ensure electricity connection to all villages

380 Million rural residents lack electricity