India's Economic Success Story Raises Energy and Environmental Challenges
Posted on April 2, 2014
India is emerging as a key economic powerhouse driving global growth: according to a United Nations' report, Brazil, China and India will account for a staggering 40 percent of global output by 2050.
India's massive economy, coupled with a rising population, will need huge amounts of energy in the years ahead. BP, in its influential 'Energy Outlook' for world energy markets, recently forecast that India's demand for energy will grow faster even than China's over the next 20 years.
Between them, these two countries will drive global demand for energy even as greater energy efficiency, technological improvements and slowing economies result in plateauing demand in the West. And the vast bulk of their demand needs will be met by traditional, polluting fossil fuels.
An important part of India's economic success story is a growing, affluent and technologically savvy middle class. India's telecommunications market, the world's second-largest after China, is forecast to be worth $100 billion by 2015, and the country is among the top five nations worldwide for Facebook users - convincing proof that India's middle class is increasingly 'wired'.
This impressive position, however, has been achieved despite India's creaking infrastructure and its unenviable record for having the most blackouts in the world.
At the same time, India's success has bypassed many of its poorest citizens living in rural areas and the country's thirst for energy has come at a price, even for the wealthy middle classes in its cities. Air pollution in India's cities is a significant and worsening problem, and is only now being addressed by the country's powerful Supreme Court. Rapid growth has also put other resources under strain. According to Ernst & Young, India is already a water-stressed country and the situation is set to worsen, with demand for water forecast to rise between 40-50 per cent over the next 20 years.
In order to generate the electricity needed to power such fast-paced growth, BP and NGOs such as Greenpeace agree that India will need to import ever larger volumes of oil-related products, particularly diesel, and fork out significant state subsidies to mitigate rising fuel costs, in turn putting pressure on government finances.
At the developmental level, close to 300 million people in India live without electricity - a commodity that, according to the United Nations Development Programme, is essential to raise them out of poverty and provide them with lighting, proper cooking facilities and clean water. In addition, even as wealthy Indians are adapting to the benefits of the Information Age, around 60 per cent of rural India has no connection to telephony, either wireless or fixed-line, and thus is denied the benefits of communications.
Managing power more efficiently is reducing the cost of operating telecoms in India
Indeed, India's telecoms infrastructure crystallises several of these issues. Phone companies have ambitious plans to build more telecom towers across India, both so they reach rural customers and in order to deliver the capacity for more advanced data services. However, because of daily power outages, the phone companies have to rely on expensive and polluting diesel - most of it imported - to run the towers when the grid is down. An estimated 3.2 billion litres of diesel was consumed by the telecoms industry last year and the figure is forecast to reach 6 billion litres by 2020.
Hydrogen is gaining popularity as a more efficient and cleaner alternative to fossil fuels. It is available from a wide range of sources, whether directly manufactured or as a by-product from industrial processes. And by means of its use in a fuel cell, hydrogen gas can be combined with oxygen from the air to generate electricity, with water the only emission.
Intelligent Energy has recently signed agreements with two Indian companies to manage the power requirements of standalone telecom towers and telecom equipment mounted on electricity towers in India. Over time, diesel generators will be replaced by our proprietary, cost effective, highly efficient and environmentally friendly fuel cells. The company is also partnering with a Welsh water purification firm, Hydro Industries, so that excess energy generated by Intelligent Energy's power management systems in India can be deployed to run rural water purification units - helping address another of the region's pressing problems.