Saturday, February 13, 2010

Energy security and urban infrastructure - Part 1

As India inches her way towards becoming an industrialized nation, her energy demands keep growing by the day. Fuelling this demand for energy is the move from an agricultural economy to an economy more dependent on revenue from services and industries. Rapid industrialization has led to economic boom, with our GDP growing at a steady clip of more than 6-7% every year. While this has had the mostly pleasant after effect of increasing the lot of the middle class, it has also led to a fantastic increase of our energy demands - be it for our cars, the air-conditioners at work or that fancy slow cooker you bought last week. Government as usual is two steps behind (with due apologies to Def Leppard) in ensuring that our energy needs are met reliably and cheaply.

Fulfilling our near insatiable demand for energy is a massive challenge for the government (and they seem to be doing a crappy job of it, as usual). I am going to try and articulate in this series how shortsighted governments have created an atmosphere of stop-gap ad-hoc arrangements that are leading us towards energy insecurity. Being net importers of oil and with very little domestic production, we are extremely vulnerable to oil price shocks. The rise of oil prices to above US$145 in the weeks prior to the global financial crisis taking center-stage was a good reminder of just how little power we have on controlling our exposure to oil prices. The need of the hour is for us to reduce our exposure and dependence on imported energy sources and try and tap into domestically available energy resources.

Most of our domestic oil consumption is towards meeting our transportation needs, be it for air, rail, road or water transport. (Fortunately, we are a tropical country with very little energy requirement for indoor heating.)
Urban infrastructure is an amateur passion that I have and in this mini-series, I hope to write about how improving our urban transportation systems will reduce our dependency on imported energy sources, improve our economy, and most importantly; improve our quality of life. I do hope you will come back and keep reading.

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