Economic Survey 2022 | India’s dependence on fossil fuel grows, coal leads the pack

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Despite India’s climate commitments, the 2021-22 Economic Survey reveals that fossil fuel-based energy still outpaces the year-on-year growth of any other energy source in the country.

“Between 2020-21 and 2019-20, the maximum rise in electricity generation was recorded in diesel-based thermal energy for utilities (electricity distribution companies),” the survey that was released on January 31 ahead of the Budget said. However, new captive power plants for industries tend to be based on renewable sources.

Thermal sources of energy account for the largest— 61.42 percent— share of total installed capacity in utilities followed by renewable energy with 24.7 percent and hydro at 12.09 percent.

Although diesel accounts for a small portion of the thermal power mix, utilities increased the use of diesel in months when generation from cleaner sources like hydropower, renewables and natural gas dipped.

Coal is the most important and abundant fossil fuel in India and accounts for 55 percent of the country’s energy needs, the survey said.

Coal production increased 12.24 percent in April-October 2021 as compared to a negative 3.91 percent in April-October 2020.

“The opening up of coal mining to the private sector is the most ambitious reform the industry has seen so far and will bring efficiency and competition in coal production, attract investments and best-in-class technology, and help create more jobs in the coal sector,” it said.

So far, 28 coal mines have been auctioned. Of these, 27 have been auctioned to private companies and the auction process for 88 is underway, the survey said.Follow our live blog for the latest on the Economic Survey 2022

The government, however, has launched several measures to be taken by the coal and lignite-producing public sector units to reduce their carbon footprint, the survey said.