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Government’s energy priorities
posted by
Vivek Sharma
29 Jun 2008, 20:26
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labels: government, energy/oil
With oil prices above $140 per barrel, total under-recoveries from retail fuel sales for this financial year is now estimated at Rs.3 lakh crore. If you are wondering why the government is not aggressively promoting alternate energy research and development of new technologies to reduce the subsidy burden, there is a simple answer. Development of alternate energy sources is not a short term solution which can bring down inflation soon and help the ruling alliance in the next election, whenever that happens.
Not many may be aware that we have a Ministry of New and Renewable Energy headed by a minister of state with independent charge, no less. If I remember correctly, this ministry was set up in the eighties when Rajiv Gandhi was prime minister. The ministry’s website says capacity additions from renewable energy sources in the Tenth Plan period (2002 – 2007) were nearly 6,800 MW as against a target of less than 3,600 MW. Wind mills account for nearly 80 per cent of the capacity additions, most likely because of the very attractive tax incentives for investments in wind mills.
The Ministry of New and Renewable Energy spent all of Rs.6.57 crore on Plan Expenditure during April this year, the latest month for which this information is available on the ministry’s website. For the same month, total oil subsidies must have been over Rs20,000 crore. It is quite obvious from these numbers what the priorities of our government are!
For the sake of our future energy security, it is high time the government started thinking long-term and step up investments in alternate energy research. How about setting aside 10 per cent of the money spent on oil subsidies for renewable energy research?
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