Thursday, September 22, 2011

India's Energy Growth Affects You: Key Facts

It is a given that world energy demand will increase over the next 25 years.  Absent a planetary disaster, there is zero chance that it will not.  But how much? 

The Energy Information Administration issued its annual international energy outlook this week, and its base case projects global energy demand increasing 53% by 2035.  My hunch is that the surprise will be that demand, while it increases, will grow quite a bit less than the EIA base case estimate.

Yet, the energy facts of India alone do make me gulp.  40% of Indians are not connected to the electric grid.  Wood is the primary fuel for 75% of rural Indians.  And remarkably the per capita electricity consumption of India is just 700 kilowatt-hours, when the US per capita consumption is 14,000 kilowatt-hours, according to an E & E article published yesterday.

All that is going to change fast.

India has 1.2 billion people or more than one in six people on earth.  The odds are highest that the person who pushes the world population to 7 billion will be born in India this October.  And India's economy has been growing about 8% per year, growing the Indian middle class and urban population.

Ron Somers, the President of the U.S.-India Business Council, is quoted in the E & E article as saying that India will need 350,000 megawatts of new power over the next 5 to 10 years to maintain 8% GDP growth. Gulp.

To put that in context, the USA has a bit more than 1,000,000 megawatts of generation.

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