South Asia's energy crisis demands collective action
- 12 August 2012
- From the section Business
The colossal collapse of India's power grid, twice in as many days last week, highlights how severe the consequences can be if nations do not address their energy demand and supply situation.
Hundreds of millions of people were without electricity, there were massive traffic jams on the roads as signals broke down, and factories and businesses came to a stand-still.
But it is not just India that is struggling with a massive gap in power demand and supply.
Crippling power cuts and shortage of energy supply are hurting growth in other South Asian nations such as Pakistan, Bangladesh and Nepal.
And the situation is likely to get worse as the demand for energy increases in these countries, according to the Asian Development Bank.
India's annual energy demand is growing at a rate of nearly 4%.
Official figures show shortages of about 10% during peak hours.
Pakistan's power crisis is going from bad to worse, with demand projected to reach 50,000 megawatts (MW) by 2030 - three times more than the supply currently available in its system.
Nepal has up to 20 hours of power cuts per day during the dry season, which is when most snow-fed rivers run at their lowest.
Meanwhile, according to some estimates, more than half of Bangladesh's total population still have no access to electricity. The World Bank says about 30% of the rural households in Bangladesh have access to grid electricity. The government insists it has already reached its target of 7,000 MW capacity by 2013.
While these nations have unveiled ambitious plans to overcome the situation, some analysts say the solution may actually lie in them pooling together their resources and supplies through a cross-border network.
"In many ways, South Asia lags significantly behind most, if not all, the regions in the world in energy trade and regional integration," says Srinivasan Padmanaban, regional director of the South Asian Regional Initiative for Energy Sarie, a programme funded by the United States government to promote cross-border power.
South Asia is rich in energy resources, ranging from renewables such as hydro-electricity and solar power to fossil fuels such as coal and gas.
Nepal, Bhutan, India and Pakistan have huge hydropower potential, while Bangladesh holds significant gas reserves.
India's coal deposits have been the engine for the country's economic growth, while those of Pakistan are yet to be mined.
Some Pakistani coastal areas have also been identified as having the potential to harness wind power.
Energy experts say all these resources pooled together through an interconnected grid could help South Asia secure its energy supplies.
"With diversity of these energy resources, cross-border trade could be a game changer to reduce the gap between demand and supply," says Mr Padmanaban.
Ram Vinay Shahi, former secretary with India's ministry of power, adds that "the power supply scenario need not be like that, given the immense resources we have in the region".
"Nepal alone has 200,000 MW of hydropower potential, India's is around 150,000 MW and Bhutan and Myanmar [the official name for Burma] have 30,000 MW each," he says.
The vast hydroelectric potential apart, experts say, the region's abundant solar and wind power could help its countries, mainly India, to gradually reduce the use of dirty fossil fuels such as coal and oil.
However, the idea of combining resources has not gained traction in the region.
The efforts for such a collaboration have been slow, mainly because of geopolitics and the lack of infrastructure such as cross-border transmission lines.
India's Minister of State for Power, KC Venugopal, admitted during a regional power conference last year that "the issue of cross-border trading was a complex one involving market, technology and, most importantly, geopolitical issues".
Hydropower development entails using water resources, a sensitive subject in South Asia's national and regional politics.
Neighbouring countries often look at each other suspiciously. The classic case has been that of Nepal and India.
They have signed agreements to build various hydropower projects on Nepalese rivers. But those files have been gathering dust because of controversies on water-sharing, the environment and population displacement.
"When you have neighbouring countries discussing these [power development] issues, many other things come up," says Mr Shahi.
Despite these issues, some key developments have started to take place.
Experts point to the increasing amount of hydropower Bhutan is supplying to India. Three Bhutanese hydro-electric projects contribute a significant chunk of power to India's national grid.
The Himalayan kingdom has also begun work on new hydropower projects totalling more than 11,000 MW. Most of it is said to be meant for the Indian market.
"By this time next year, a transmission line of 500 MW capacity between Bangladesh and India will be ready," says Mr Shahi who is also an adviser for the World Bank's South Asia energy programme.
"The Indian government has agreed to supply 500 MW of power to Bangladesh."
India and Nepal are also working on cross-border power transmission lines. And officials say India and Pakistan have been holding talks for grid inter-connectivity.
"Now, South Asia is witnessing the emergence of sub-regional grids, especially in the eastern part of the region," says Mr Padmanaban of the Sarie.
"The cross-border interconnection between India and Bhutan, India and Nepal and now between India and Bangladesh are examples of what is beginning to happen."
But officials involved in negotiations say this might be a painfully slow and long journey.
"No matter how much bureaucrats and technocrats like us work for such regional interconnectivity, it is not going to happen unless governments involved really want it," says a senior official with Nepal Electricity Authority.
And unless South Asian governments really want to solve their differences, the region's power crisis looks set to become perennial.