Environmental Implications of the Energy Ladder

02/ 11/ 2012

Env ironm ent al im plic at ions of t he energy ladder in rural I ndia

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Environmental implications of the energy ladder in rural India

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Environmental implications of the energy ladder in rural India

by Preet i Malhot ra, Tat a Energy Research Inst it ut e, Darbari Set h Block , Habit at

Place, Lodhi Road, New Delhi 110 003, India

The rural population in India depends on traditional biomass fuels (wood, animal dung

and crop residues) for meeting their energy needs. Though nationally there has been a

decrease in the share of traditional fuels, as biomass is being increasingly substituted by

commercial fuels, the shift to commercial fuels has been negligible in rural areas. In these

areas, the monthly consumption of fuelwood has increased per person from 16.24 kg in

1987- 88 to 17.27 kg in 1993- 94 (NSSO 1997).

Energy consumption in rural areas is determined by: the availability and accessibility of

local biomass resources; the competing uses for biomass; availability of commercial

energy sources; the cost of commercial fuels such as LPG and kerosene (NCAER

1985); absence of an effective supply especially in the rural areas (TERI 1998); and

inadequate production and refining capacity of LPG (Ravindranath and Ramakrishna

1997).

One reason is the range of policies on supply and pricing of commercial fuels, which

discriminates between urban and rural areas. The Government of India gives a subsidy

on kerosene and LPG, which mainly benefits the urban population, where these fuels are

easily available. The price paid by the consumer for kerosene is 69% of the production

and supply cost, for LPG it is 61% and for electricity it is 48% (TERI 1992). For

commercial fuels, the supply and distribution, as well as the prices, are regulated by

government agencies. Kerosene is supplied through the Public Distribution System

(PDS) - a...