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Poverty reduction and economic growth are the prime objectives of national policy. Energy is the sine qua non of development. India, with over a billion people, today only produces 660 billion KWh of electricity and over 600 million Indians, a population equal to the combined population of USA and EU, have no access to electricity, and limited access to other clean, modern fuels such as LPG and kerosene. This constrained energy access is reflected, as shown in Figure 1, in the relatively low Human Development Index of India. Enhancing energy supply and access is therefore a key component of the national development strategy.
Over the past decade, gains in both poverty reduction and economic growth have been significant, and supported by energy growth which has been significantly lower than the economic growth. This reduced energy intensity of the economy, in the period since 2004, has been marked by an economic growth rate of over 9% per annum, which has been achieved with an energy growth of less than 4% per annum. These policies have been driven by the imperatives of sustainable development, and have, as a co-benefit, led to a decline in the intensity of energy use and carbon dioxide emissions as well. Figure 2(a) illustrates the declining trend in energy use and CO2 emissions intensities, and Figure 2 (b) highlights that the energy intensity of the Indian economy compares favourably with those of other major economies.
