world has become dangerously addicted to oil, due to its
fungibility and easy use. Predictably, the motor car has
become the preferred mode of transport. In the US, automobile
majors have taken to advertising sale of cars on credit
at zero down payment, zero interest and zero repayment in
the first year! We, in India, have followed this model,
with yearly vehicle production slated to reach 10 million
by 2007. Thanks to poor public transport, the current car
ownership of eight per 1,000 is slated to go up considerably
over the next two decades.
oil demand is now rising at 10% every year. In 2004, of
the total 114 million tonnes of oil requirement, 75% was
imported at a cost of $26 billion. And yet, in the foreseeable
future, we need a fungible source like oil to meet a variety
of energy needs. What can we do to reduce dependence on
have to identify and mass-produce renewable fuels. Fuel
cell technology based on hydrogen still lies in the future.
Many renewable sources, such as solar, tidal or wind power,
suffer the great disadvantages of high cost, inadequate
technology and inability to store and use flexibly. For
years, Nobel laureate and physicist, George Porter, and
others have ably argued that the sun is the most reliable
energy source and green plants the most cost-effective energy
factories, harnessing sunlight through photosynthesis. Through
genetic engineering, the efficiency of photosynthesis can
be doubled from the current 2%. If that happens, we can
have cheap, plentiful, renewable fungible bio-fuels to meet
all our energy needs.
may be a futurologists dream. But happily, even today
we have the technology and means to mass-produce oil substitutes
for our transportation needs. While Indias land mass
is only 2.5% of the worlds, we are blessed with about
12% of the total agricultural land. Production of ethanol
through fermentation of sugars, bio-diesels from plants
like jatropha and, eventually, full conversion of all biomass
into ethanol and other fuels through genetically engineered
enzymes are our three best options. Full biomass conversion
on a commercial scale will be possible within three to five
years, but ethanol from plant sugars and bio-diesel from
oils are already commercially viable.
Brazil, India, Malaysia and Indonesia are best placed to
harness these renewable fuels, thanks to rich soils, plentiful
sunlight and year-long cropping. Brazil is already the pioneer,
producing 14 billion litres of ethanol from sugarcane, or
the equivalent of two lakh barrels of gasoline a day. Brazilian
law requires all motor vehicles to use fuel blended with
22% ethanol, while 20% of all vehicles use only ethanol.
What is more, the cost of ethanol is very low, at $25 a
barrel equivalent of gasoline. The Brazilian programme created
nearly a million new jobs and cut oil import bills by a
cumulative $60 billion (at 2000 prices) over the past three
decades. This amount is more than 10 times the total investment
in the programme and over 50 times the initial subsidies
given. Guaranteed purchase by the state-owned oil company,
Petrobras, low-interest loans for agro-industrial ethanol
firms and price stabilisation of ethanol, at 59% of the
government-set gasoline price at the pump, were the key
policy initiatives which helped the boom. Nearly 25% of
gasoline has thus been substituted by ethanol, produced
on only 5% of the agricultural land.
committee on development of bio-fuel, in its 2003 report,
noted our present distiller capacity of 29,000 kl of ethanol
was sufficient for a 5% blend until the 12th Plan. The committee
also recommended raising jatropha plantations over 11.2
m ha of degraded and hedge lands, under-stocked forests
and cultivable fallows. India can easily move towards a
20% ethanol blend with gasoline, and a 20% bio-diesel blend
with diesel, over the next decade.
encourage such a shift, the right policies and investments
should be in place. That means tax incentives, subsidies to
agriculture for bio-fuels, processing capacity, infrastructure,
investment in technology and distilleries, buyback arrangements,
guaranteed offtake of ethanol and bio-diesel, removal of restrictions
on molasses movement and bio-fuel manufacturing, and
R&D. The benefits are manyenergy security, lower
costs of fuel, reduction of overall carbon dioxide and particulate
emissions, revitalisation of agriculture, protection of top
soil and sustainable growth.
choices in todays world offer such win-win solutions.
The world is shifting gears to reduce dependence on imported
oil. India has a priceless opportunity, given our natural
advantages. It is time to act.