Dr R K Pachauri emphasises the need to unite the Energy sector

In an exclusive with PWI, Dr R. K. Pachauri, Director General, TERI, spoke of economic and resource sustainability, the need for an integrated energy approach and corporate commitment to inclusive development...

At the Rio+20 Earth Summit, you made a statement about how India needs to take on 'intellectual leadership' towards achieving sustainable development goals. How does one decipher the term 'intellectual leadership'?There is a whole range of things that can be included in intellectual leadership. The first thing is that we, as a society need to accept that we have to bring about change. This change should not only be along a conventional pathway or what the developed world has done, because we know that resources are limited and it will create inequities. Secondly, we need to consider how to ensure economic growth and development, while achieving resource use efficiency. For this, we really need to innovate. If we fail to do so, the society will be in deep trouble in the future. I do not think we should pursue what the world has taken for granted as the pattern within which development takes place. We should be able to articulate on the basis of substantial analysis and soul-searching, on where it is that India has to define a paradigm/pattern of development that suits our resource endowments and suits our conditions in terms of customs, traditions and history. This is what I mean by 'India taking on intellectual leadership'.

Private participation in the power sector has gone up from 17 per cent at the beginning of the 10th Five Year Plan to almost 60 per cent in the 12th Plan. In this context, how do we tie up corporate social responsibility (CSR) with commitment to the environment?We need to bring about a whole range of reform as these things cannot be seen in isolation. As far as private sector participation in the power sector is concerned, we need to think how is it that they are going to get the required fuel, acquire land, and most importantly, how to ensure through regulatory means, that they bring the best technology and use fossil fuels as efficiently as possible. In this area, the segmentation that is happening in the energy sector is causing lot of problems.

Ideally, this country needs to have only one Ministry of Energy. However, since politically, is it difficult, each one functions in isolation, and we are seeing to a large extent, the results of this functioning in a isolation.

The sector requires a body which brings together all these ministries, and ensures that every single action, project is conceptualised and planned in a manner that it takes all the inputs on board. This will require enormous amount of coordination with the state governments - the states and Centre have to be on the same page.

The State Regulatory Commissions are largely devoid of expertise. Some of them don't even exercise the authority that they are mandated to do. All of thisneeds to be repaired quickly. There is an urgent need to come up with a structure, system and process by which proper coordination can be developed not just across ministries in the government but also with respect to state governments. They should give inputs which ensure that power plants take off and start functioning. The power sector is one of the largest in the Indian economy in terms of volume of activity. Ironically, there is no R&D happening in the sector. If we could come up with an institutional mechanism for R&D in the power sector, the Centre would benefit, along with the states.

Amidst the various problems like fuel security and land clearance, energy efficiency is also a major concern as it is not seen in the right spirit. What is your take on this?I think we need to create conditions by which there are incentives for consumers to move towards high levels of efficiency. For instance, in the agriculture sector, electricity is given at throw-away prices. There is no incentive for farmers to install efficient pump sets and even lower incentive to provide only a measured amount of water for irrigation. As a result, the farmers leave their pumps on over night, which causes flooding in the fields and leads to salination problems. Thus, there is a strong need for measures to bring about improvement in efficiency. We need a combination of both market-based forces and regulations.

Just like there are standards for consumer electronics, can't we have something like that for the power industry as well?Well, it could be. But, I would go a step further than just lay down benchmarks. We need to have differential taxation against inefficient devices. Further, with regard to pricing of electricity especially in urban areas, we need to have time-of-day metering pricing. There are certain devices which are switched on simultaneously, causing huge load in terms of peak demand for power. These are the things that need to be looked into. Efficiency will improve only if regulation, information as well as market based instruments are used together.

What are your views on tying up water and energy into a singular national policy?Firstly, we need to unite the entire Energy sector since it is fragmented as of now. Once that is done, we can move ahead with the linkages of water and energy. In fact, there are many sectors in which water and energy go together. In these areas, we will have to lay down benchmarks (incentives/disincentives) which ensure that energy and water are used efficiently.

How do we dis-incentivise a manufacturing or power generation sector?It can be done through differential taxation. We couldreplicate what Bureau of Energy Efficiency (BEE) has been doing with regard to measuring the level of efficiency of devices.

While we have a very actionable mission for solar, wind energy is seeing a downfall because of the withdrawal of generation based incentive and cut down in the accelerated depreciation. How do you see the renewable energy sector shaping up, going ahead?This is one area in which there is lack of intellectual capacity. The solar energy mission is a vision of the future but we got to see how far we can go with implementing it. With great difficulty, we have come up with a solar energy cooperation, but it has been a year and a half and the body still doesn't have a chief executive. So, it is like creating a highly innovative programme but marring it with old tools, techniques and bureaucratic practices. As far as renewable energy is concerned, we really need a very clear roadmap, which defines who will do what - both at the Central as well as state level. Further, it needs to be backed with proper R&D.

R&D and trained skill are essential factors which have constantly been ignored by the sector. What is your message regarding this?We need to set up goals and lay down time lines. When R&D activities are undertaken, it is critical that they are done the right way, and not throw good money after bad money. So, there has to be a goal-oriented plan, by which we would develop technology.

There has been an announcement with regard to an MoU between TERI and IICA for sustainability reporting in industry. How do you see both the organisations working hand-in-hand on this? Sustainability reporting will have to have a very clear objective and needs to be well defined. We need to address very tangible things that constitute sustainability, something that varies from sector to sector. Lot of work needs to be done for laying down guidelines and requirements, which the corporate sector can adopt.