Wednesday, December 23, 2009

what india should have done in copenhagen

dec 24th, 2009

just some thoughts:

1. we should focus on the end, that is energy security; and let us not get overly diverted by the means such as copenhagen. india needs to be able to runs it affairs and its economy without being constrained by third-party suppliers such as OPEC or australia. we need to reduce supplier power to the minimum, which means we have to look at sustainables that are most appropriate for india

2. india should cease to think of itself as one of the have-nots, because in aggregate india's energy needs (and alas, carbon emissions) are getting to be among the highest in the world. the issue of low per-capita needs (and emissions) is a useful stick to beat the rich countries with, but we should not get confused about it. china has demonstrated this very well: it runs with the hares (the developing countries) but then it hunts with the hounds (the developed countries -- hence its insistence on no numerical quotas for emissions.)

3. india should think of energy as an opportunity: this is the next big industry after IT, and india should aggressively support its firms that show promise. these, if allowed to grow and innovate, can end up taking a dominant position in the industry. for instance, see friedman's report about how tiny denmark, through proper taxation and channeling of funds has been able to encourage its energy industry, *and* reduce its dependence on OPEC. see http://www.nytimes.com/2009/12/23/opinion/23friedman.html?_r=1

4. india should put in place a crash program for energy conservation. to take a tiny example, just look at road congestion and the problem of gridlock at junctions, where all traffic comes to a standstill because some idiot decided to run a yellow light and prevents cross-traffic from flowing past him. ruthless fining (on the spot fines of rs. 1000 would be a good start) will reduce gridlock. and the amount of fuel we waste because of poor roads and traffic congestion -- this should be added to the budget for the roads department

5. india should also look at the fully loaded cost of hydrocarbons, including subsidies, the hidden cost of ports, LNG terminals, refineries, pipelines, railway lines, and even naval patrols in the gulf of aden, and attribute all that to the actual cost of an oil-based economy. if you do this, suddenly the high-capital-cost renewables such as solar and wind start looking much more attractive in comparison. subsidies for renewables can then be justified

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