Four Demographic Realities of Renewable Energy in India

Shri Jairam Ramesh, an economist and Member of Parliament for Andhra Pradesh, outlines India’s unique challenges for planning the country’s transition to renewable energy sources. He spoke at the Chazen Institute’s India Business Initiative conference in Mumbai on January 15, 2018.
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Let me begin by saying that any discussion on climate policy and renewable energy must reckon with four demographic realities.

I think keeping these demographic realities in mind, we can have a more meaningful discussion on what the future of renewable energy and climate policy in this country is.

First, today we are 1.24 billion, and by the middle of the century, we will be 1.7 billion. It’s no question of, we may be, or we could be – we will be 1.7 billion. So we’re going to add 400 million people to our population in the next thirty years, and I think this is something that we need to recognize and factor in into all our planning.

The second is that, given the fact that our population is going to increase so astronomically, and given the fact that our median age of our population is not going to increase very significantly – today it’s 28, and even by the middle of the century it will be somewhere in the high 30’s, still less than 40 – the additions to the labor force are going to be very, very substantial. We are going to be adding at least 8 to 9 million people every year to the labor force, which means the Indian economy has to sustain a growth of at least 7.5 to 8 percent per year for the next 25 to 30 years.

Over the last decade, average GDP growth, real GDP growth, has averaged about 7.5 percent. And we know that that is insufficient to generate the number of jobs required – productive jobs required – for a growing population. And I think therefore we need to recognize that a consequence of our demographic growth is the fact that our economic growth has to be sustained at at least 7.5 to 8 percent per year, over the next 3 decades.

Thirdly, and this is of particular importance to renewable energy and energy planning, per capita energy consumption, even though per capita figures mask a lot of inequalities, nevertheless, it’s a useful metric to take. Per capita electricity consumption, which is really what we’re talking about, per capita electricity consumption in India is one fourth the level that is in China, one tenth the level that is in Europe, and one thirteenth that it is in the United States. We are not aspiring to US levels of consumption. We are probably not even aspiring to European levels of consumption, but even by the Chinese levels of consumption, we are, you know, at one fourth that. So per capita electricity consumption has to increase very, very significantly for the standard of living and quality of life to improve.

And fourth, and finally, the reality that we have to reckon with, is that – and this again has great relevance for renewable energy planning – is the fact that out of about 250 million families in our country – families in our country – about 50 million still are not on grid electricity. They are on off grid. So you have about 50 million homes in this country that are not electrified. And that in the short and immediate horizon are not going to get electricity in economical terms from the grid.

So these are the four sort of metrics before realities that we have to reckon with when we do our renewable energy planning.

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