Coal from Australia can't end India's energy poverty, costs are too high, says top ex-bureaucrat

By A Representative
India's former energy secretary EAS Sarma has strongly put forward the case against coal mining, considered by powerful coal-fired power company owners of India as the panacea to end “India's energy poverty”. In an article in the wake of the Australian Federal Court calling environmental nod to the Adani Group's coalmining project in the country as “invalid”, he says, social and economic costs of sending power to all the nooks and cornder of India are “huge” and far “outweigh” the perceived benefits of coal.
Claiming that as former secretary of India’s ministry of power, he knows India’s challenges, the ex-bureaucrat has said, “Australian coal doesn’t make economic sense for us – but renewables do”, adding, the Adanis' “huge Carmichael coal mine – the biggest in Australian history – has been overturned by the Federal Court, causing much consternation for coal advocates, chief among them Australian prime minister Tony Abbott.”
“Abbott”, says Sarma, writing in the influential British daily “The Guardian” (August 7), “contends that Carmichael is critical for the human welfare of tens of millions of Indians and will provide power for 100 million people in India who currently have none”, but ground realities are totally different.
According to Sarma, “The claim that 100 million will be lifted out of energy poverty by a new wave of coal exports – driven largely by Indian companies Adani and GVK’s proposals to open Queensland’s vast Galilee Basin coal fields – reveals a deep lack of understanding of the real situation in India and other countries, where large populations remain without access to electricity.”
“India’s population of 1.24 billion comprises 247 million households, 68% of whom live in rural villages. According to the 2011 census, 45% of these rural households – 75 million – have no electricity. Of urban households, 6 million remain without electricity, or about 8% of the total”, says Sarma, adding, “These figures have not changed appreciably since 2001, though around 95,000 MW of new largely coal-based electricity generation capacity was added.”
Pointing out that “the benefits of adding new generation capacity accrued largely to the existing, affluent consumers” and “there are a number of reasons why this is the case”, Sarma says, “In the rural areas, many remote villages are beyond the reach of the electricity grid. There are also many families in electrified villages who cannot pay for expensive electricity.”
Quoting studies which show that “when a village is more than 5km from the grid, the cost of supplying electricity from solar and other off-grid solutions is far below the costs of supplying from conventional sources such as coal”, the ex-bureaucrat says, “This is due to the high cost of building out the poles and wires to provide access to coal electricity and the technical losses involved in transmitting and distributing electricity to the consumers.”
Over and above this, Sarma says, “There is also a growing public opposition to industrial projects, especially large centralised power plants, whether coal-based, hydro or nuclear, as they uproot thousands of families from their lands, pollute their environment and disrupt their lives. Upstream, coal and uranium mining activities are equally destructive.”
He adds, “Burning coal, whether local or imported, generates large quantities of fly ash containing toxic pollutants like lead, zinc, arsenic, cadmium, sulfur, mercury and radioactive uranium/ thorium isotopes, which adversely affect the health of the people near the power stations, often the rural poor, whose disadvantage is worsened by these health impacts.”
Citing studies on people residing near coal-based power plants along the border of Uttar Pradesh and Madhya Pradesh, he says, these have “revealed unsafe levels of mercury in their blood samples, at times as high as 110 parts per billion.” He adds, “Similarly, studies around a coal power plant in the Punjab have indicated widespread radioactive contamination of the environment, impacting the health of pregnant women and children.”
Insisting that “such huge social costs outweigh the perceived benefits of coal”, Sarma says, “Though a large coal producer, India’s domestic production of coal has lagged behind the demand, increasing the country’s dependence on imports, which are presently 180 million tonnes. Most of this coal comes from Indonesia, which is cheaper than Australian coal.”
"The Institute of Energy Economics and Financial Analysis has shown that the cost of producing electricity in India using Australian coal from the Galilee Basin is two times the current average wholesale cost of electricity. This makes Galilee Basin coal too expensive for India”, Sarma points out, adding, hence “to address energy poverty and energy security, India’s focus must be on encouraging locally-generated and indigenous renewable energy systems.”