Natural Gas Matters: LNG and India’s Quest for Clean Energy
Abstract
:1. Introduction
1.1. Background and Context of India’s Clean Energy Goals
1.2. Significance of Natural Gas and LNG in the Energy Transition
1.3. Existing Studies
1.4. Research Objectives and Scope
2. Methodology and Data Sources
2.1. Univariate Modeling
2.2. Multivariate Modeling
2.3. Data Sources
3. Results and Analysis
3.1. Gross Energy Demand
3.1.1. Status and Trends
3.1.2. Share of Coal/Oil/Nuclear/Renewables
3.1.3. Forecast
- (i)
- GDP: two alternate scenarios—6 percent pa growth between 2020 and 2050 (Business-as-Usual scenario (BAUS), observed long-run growth rate over the 2010–2020 period) and 8 percent pa growth rate (high-growth scenario).
- (ii)
- GCF: remains unchanged at 30 percent of GDP.
- (iii)
- Share of the manufacturing sector in GDP: unchanged at 16 percent of GDP.
- (iv)
- Price levels: follows the IEA projections, rising by 2.5 percent pa during 2020–2030 and at 3 percent pa after that.
- (v)
- Population: MOHFW [39] projections.
3.2. Natural Gas
3.2.1. Production and Consumption: Status and Trends
3.2.2. Univariate Forecast of Natural Gas Consumption
3.2.3. Multivariate Forecast of Natural Gas Consumption
3.2.4. Forecast of Natural Gas Production
4. Discussion and Implications for Natural Gas Sector
5. Conclusions
5.1. Summary and Future Recommendations
5.2. Limitations of the Study and Future Scope
Author Contributions
Funding
Data Availability Statement
Conflicts of Interest
Appendix A
Explanatory Variables | Coefficients (after Transformation) | p-Value |
---|---|---|
LN Population | 1.164 * (0.830) | 0.082 |
LN GDP | 0.445 *** (0.172) | <0.01 |
LN PCMANU | 0.045 (0.099) | 0.652 |
LN Gross Capital Formation | 0.030 (0.034) | 0.383 |
LN Price Index | 0.109 (0.068) | 0.124 |
Rho (ρ) for residuals of the OLS model | 0.866 ** | |
Breusch–Godfrey test statistic for OLS model | 22.183 ** | <0.01 |
Durbin–Watson Statistic of OLS model | 0.642 ** | <0.01 |
Rho (ρ) for residuals of C-O model | 0.035 | |
Durbin–Watson Statistic of C-O model | 1.825 | 0.193 |
Adjusted R2 for C-O Model | 0.928 |
Explanatory Variables | Coefficients (after Transformation) | p-Value |
---|---|---|
LN GDP Per capita | 0.624 ** (0.239) | 0.015 |
LN PCMANU | 0.163 (0.305) | 0.597 |
LN Gross Capital Formation | 0.129 (0.118) | 0.284 |
LN Price Index of NG | 0.016 (0.042) | 0.699 |
Rho (ρ) for residuals of the OLS model | 0.835 ** | |
Breusch–Godfrey test statistic for OLS model | 12.396 * | 0.03 |
Durbin–Watson Statistic of OLS model | 0.683 ** | <0.01 |
Rho (ρ) for residuals of C-O model | 0.547 | |
Durbin–Watson Statistic of C-O Model | 1.6349 | 0.25 |
Breusch–Godfrey test statistic for C-O model | 10.200 | 0.17 |
Adjusted R2 for C-O Model | 0.450 |
Variables Used | Units of Measurement | Source |
---|---|---|
Gross Domestic Product (GDP) and its sectoral composition | USD Billion at Constant 2005 prices | National Account Statistics, GoI (various years), converted to USD using World Development Indicators, World Bank Database |
Gross Capital Formation | USD Billion at Constant 2005 prices | National Account Statistics, GoI (various years), converted to USD using World Development Indicators, World Bank Database |
Population | Millions | (a) Census of India (b) Ministry of Health & Family Welfare, GoI |
Price Index (Energy) | Indexed value | Handbook of Statistics on Indian Economy, Reserve Bank of India |
Primary Energy Consumption | Exajoule (EJ) | British Petroleum (BP) Statistical Review |
Per Capita Energy Consumption | Gigajoule (GJ) per capita | British Petroleum (BP) Statistical Review |
Total Energy Consumption | Exajoule (EJ) | British Petroleum (BP) Statistical Review |
Forecasted Total Primary Energy Consumption (TPEC) | Exajoule (EJ) | Authors’ own calculation |
Natural Gas Production, Consumption, and Import | Billion Cubic Meters (BCMs) | Indian Petroleum and Natural Gas Statistics, Ministry of Petroleum & Natural Gas, Government of India |
Consumption of Natural Gas in India by Sectors: 1990–2020 | Billion Cubic Meters (BCMs) | Indian Petroleum and Natural Gas Statistics |
Forecasts of Natural Gas Consumption in India: 2030–2050 | Billion Cubic Meters (BCMs) | Authors’ own calculation |
Price of Natural Gas | USD/MMBTU | BP Statistical Review |
References
- IEA. India Energy Outlook 2021 Special Report. 2021. Available online: https://www.iea.org/reports/india-energy-outlook-2021 (accessed on 30 November 2023).
- Energy Statistics of India. Ministry of Statistics and Programme Implementation, Government of India (MoSPI). 2023. Available online: http://www.mospi.gov.in (accessed on 25 November 2023).
- GoI. “Vision 2030”: Natural Gas Infrastructure in India; Petroleum & Natural Gas Regulatory Board, Ministry of Petroleum and Natural Gas, Government of India: New Delhi, India, 2013.
- NITI Aayog, GoI. “India Vision 2040” Chapter 15, Draft National Energy Policy NITI Aayog, Government of India. 2017. Available online: http://www.niti.gov.in (accessed on 1 December 2023).
- MoPNG. Annual Report, Ministry of Petroleum and Natural Gas, Government of India. 2022. Available online: https://mopng.gov.in/en (accessed on 21 November 2023).
- Samaddar, A.; Arora, S. Natural Gas Scenario in India: An Overview. 2012. Available online: http://papers.ssrn.com (accessed on 18 September 2023).
- Seznec, J.; Pallakonda, R. NATURAL GAS. In India’s Energy Needs and the Arab/Persian Gulf; Atlantic Council: Washington, DC, USA, 2017; pp. 6–8. Available online: http://www.jstor.org/stable/resrep03692.7 (accessed on 29 October 2023).
- Kumar, V.V.; Shastri, Y.; Hoadley, A. A consequence analysis study of natural gas consumption in a developing country: Case of India. Energy Policy 2020, 145, 111675. [Google Scholar] [CrossRef]
- Safari, A.; Das, N.; Langhelle, O.; Roy, J.; Assadi, M. Ntural Gas: A Transition Fuel for Sustainable Energy System Transformation? Energy Sci. Eng. 2019, 7, 1075–1094. [Google Scholar] [CrossRef]
- Mitra, N. Energy Policy Planning in India: Case of Petroleum and Natural Gas. Econ. Political Wkly. 1992, 27, M109–M115. [Google Scholar]
- Prasad, N.K. Regulation of Natural Gas in India. Econ. Political Wkly. 2008, 43, 21–24. [Google Scholar]
- Kelkar, V. Towards a New Natural Gas Policy. Econ. Political Wkly. 2009, 44, 8–10. [Google Scholar]
- Jain, A.; Sen, A. Natural Gas in India: An Analysis of Policy; The Oxford Institute for Energy Studies: Oxford, UK, 2011. [Google Scholar]
- Tiewsoh, L.S.; Sivek, M.; Jirásek, J. Traditional energy resources in India (coal, crude oil, natural gas): A review. Energy Sources Part B Econ. Plan. Policy 2017, 12, 110–118. [Google Scholar] [CrossRef]
- Vaid, M. India’s Natural Gas Infrastructure: Reassessing Challenges and Opportunities. Strateg. Anal. 2014, 38, 508–527. [Google Scholar] [CrossRef]
- Janardhanan, N.K.; Institute of Peace and Conflict Studies. India’s Energy Policy: Energy Needs and Climate Change. In Indian and Chinese Energy Policies: Addressing Energy Needs and Climate Change; Institute of Peace and Conflict Studies: New Delhi, India, 2017; pp. 3–8. Available online: http://www.jstor.org/stable/resrep09398.4 (accessed on 1 November 2023).
- Mahalingam, S.; Sharma, D. Political Economy of Independent Regulation in India’s Natural Gas Industry. Econ. Political Wkly. 2017, 52, 44–50. [Google Scholar]
- Bhowmick, M.; Dutta, T. Dependency of Indian Economy on Natural Gas and Its Barriers; Working Paper Series, GCP/JU/17/01; Global Change Programme; Jadavpur University: Kolkata, India, 2017. [Google Scholar]
- Rawat, A.; Garg, C.P. Assessment of the barriers of natural gas market development and implementation: A case of developing country. Energy Policy 2021, 152, 112195. [Google Scholar] [CrossRef]
- Alam, M.S.; Murshed, M.; Palanisamy, M.; Duraisamy, P.; Abduvaxitovna, S.Z. Forecasting oil, coal, and natural gas prices in the pre-and post-COVID scenarios: Contextual evidence from India using time series forecasting tools. Resour. Policy 2023, 81, 103342. [Google Scholar] [CrossRef] [PubMed]
- Adebayo, T.; Ozturk, I.; Aga, M.; Uhunamure, S.; Kirikkaleli, D.; Shale, K. Role of natural gas and nuclear energy consumption in fostering environmental sustainability in India. Sci. Rep. 2023, 13, 11030. [Google Scholar] [CrossRef] [PubMed]
- PNGRB. Vision 2030: Natural Gas Infrastructure in India, Report by Industry Group for PNGRB. 2013. Available online: www.pngrb.gov.in/Hindi-Website/pdf/vision-NGPV-2030-06092013.pdf (accessed on 8 November 2023).
- NEP. 2017. Available online: https://www.niti.gov.in (accessed on 11 November 2023).
- Gelper, S.; Fried, R.; Croux, C. Robust Forecasting with Exponential and Holt-Winters Smoothing. SSRN 2007. [Google Scholar] [CrossRef]
- Tularam, G.A.; Saeed, T. The use of Exponential Smoothing (ES), Holts and Winter (HW) and ARIMA models in oil price analysis. Int. J. Math. Game Theory Algebra 2016, 25, 13–22. [Google Scholar]
- Tratar, L.F.; Mojškerc, B.; Toman, A. Demand forecasting with four-parameter exponential smoothing. Int. J. Prod. Econ. 2016, 181, 162–173. [Google Scholar] [CrossRef]
- De Oliveira, E.M.; Oliveira, F.L.C. Forecasting mid-long term electric energy consumption through bagging ARIMA and exponential smoothing methods. Energy 2018, 144, 776–788. [Google Scholar] [CrossRef]
- Cochrane, D.; Orcutt, G.H. Application of Least Squares Regression to Relationships Containing Auto-Correlated Error Terms. J. Am. Stat. Assoc. 1949, 44, 32–61. [Google Scholar] [CrossRef]
- Suganthi, L.; Jadadeesan, T.R. A modified model for prediction of India’s future energy requirement. Energy Environ. 1992, 3, 371–386. [Google Scholar] [CrossRef]
- Sengupta, J.K. Information Theory in Econometrics. In Econometrics of Information and Efficiency; Springer: Dordrecht, The Netherlands, 1993; pp. 71–105. [Google Scholar]
- Parikh, J.; Purohit, P.; Maitra, P. Demand Projections of petroleum products and natural gas in India. Energy 2007, 32, 1825–1837. [Google Scholar] [CrossRef]
- Intarapravich, D.; Johnson, C.J.; Li, B.; Long, S.; Pezeshki, S. Asia-Pacific energy supply and demand to 2010. Energy 1996, 21, 1017–1039. [Google Scholar] [CrossRef]
- Hunt, L.C.; Ninomiya, Y. Primary energy demand in Japan: An empirical analysis of long-term trends and future CO2 emissions. Energy Policy 2005, 33, 1409–1424. [Google Scholar] [CrossRef]
- BP Statistical Review. BP Statistical Review of World Energy. 2023. Available online: https://www.bp.com/en/global/corporate/energy-economics/statistical-review-of-world-energy.html (accessed on 22 November 2023).
- IEA (International Energy Agency). World Energy Outlook 2022. Available online: https://www.iea.org/reports/world-energy-outlook-2022 (accessed on 16 November 2023).
- World Bank. World Development Indicators. Available online: http://data.worldbank.org (accessed on 8 November 2023).
- National Accounts Statistics, MoSPI. Available online: https://mospi.gov.in (accessed on 3 November 2023).
- Handbook of Statistics on the Indian Economy. Wholesale Price Index, Annual Average; Reserve Bank of India. 2022. Available online: https://dbie.rbi.org.in (accessed on 31 October 2023).
- MOHFW. Annual Report, Ministry of Health and Family Welfare. 2011. Available online: http://main.mohfw.gov.in (accessed on 6 November 2023).
- BP Energy Outlook. BP Energy Outlook Summary Tables—2020–2050. 2023. Available online: http://bp.com/energyoutlook (accessed on 20 November 2023).
- Corbeau, A.; Hasan, S.; Dsouza, S. The Challenges Facing India on Its Road to a Gas-Based Economy; King Abdullah Petroleum Studies and Research Centre: Riyadh, Saudi Arabia, 2018; Available online: https://www.kapsarc.org/uploads/2018/10.pdf (accessed on 14 August 2023).
- Indian Petroleum and Natural Gas Statistics (Various Volumes). Economics and Statistics Division, Ministry of Petroleum and Natural Gas, Government of India. Available online: http://mopng.gov.in (accessed on 5 November 2023).
- NITI Aayog. Annual Report, 2022-23; Government of India: New Delhi, India, 2023. Available online: https://www.niti.gov.in/sites/default/files/2023-02/Annual-Report-2022-2023-English_1.pdf (accessed on 15 November 2023).
- GoI. Snapshot of India’s Oil & Gas data: Monthly Ready Reckoner April 2023; Petroleum Planning & Analysis Cell, Ministry of Petroleum & Natural Gas, Government of India: New Delhi, India, 2023. [Google Scholar]
- MoPNG. Indian Petroleum and Natural Gas Statistics 2017–2018. 2018. Available online: http://petroleum.nic.in/sites/default/files/ipngstat_0.pdf (accessed on 21 November 2023).
- MoPNG. Annual Report of Ministry of Petroleum and Natural Gas; GOI: New Delhi, India, 2023. Available online: https://mopng.gov.in/files/TableManagements/annualreport2223.pdf (accessed on 24 November 2023).
- ET. India to Achieve 50% Clean Energy Share, 500 GW RE Capacity Targets before 2030 Deadline: RK Singh. The Economic Times, 9 November 2021. Available online: https://economictimes.indiatimes.com/industry/renewables/india-to-achieve-50-clean-energy-share-500-gw-re-capacity-targets-before-2030-deadline-singh/articleshow/87604552.cms (accessed on 12 August 2023).
- International Gas Union. 2022 World LNG Report. Available online: https://www.igu.org/wp-content/uploads/2022/07/IGU-World-LNG-Report-2022_final.pdf (accessed on 16 August 2023).
Year | Gross Domestic Product (GDP) (at Constant 2015 USD Billion) | Primary Energy Consumption (EJ) | Per Capita Energy Consumption (GJ per Capita) |
---|---|---|---|
1990 | 465.2 | 8.3 | 9.5 |
2000 | 800.5 | 13.4 | 12.7 |
2010 | 1535.9 | 22.6 | 18.1 |
2020 | 2508.6 | 32.2 | 22.7 |
2022 | 2954.9 | 36.4 | 25.7 |
Year | Total Energy Consumption (EJ) from | Shares (%) in TPEC of | ||||||
---|---|---|---|---|---|---|---|---|
Coal | Oil | Nuclear | Other Non-Renewables | Renewables (Incl. Hydro) | Fossil Fuels | Renewables (Incl. Hydro) | Others | |
1990 | 4.59 | 2.50 | 0.07 | 0.43 | 0.71 | 86.3 | 8.6 | 5.2 |
2000 | 6.88 | 4.61 | 0.16 | 0.89 | 0.86 | 86.9 | 6.4 | 6.6 |
2010 | 12.14 | 6.60 | 0.22 | 2.15 | 1.49 | 83.9 | 6.6 | 9.5 |
2020 | 17.40 | 9.08 | 0.40 | 2.19 | 3.13 | 83.5 | 9.7 | 6.8 |
2022 | 19.30 | 9.25 | 0.40 | 3.66 | 3.79 | 79.5 | 10.4 | 10.1 |
Forecasted TPEC (EJ) | |||
---|---|---|---|
Univariate Forecast (Holt Method) | Multivariate Forecast (Cochrane–Orcutt) | ||
BAUS | High-Growth Scenario | ||
2030 | 54.2 | 50.2 | 55.4 |
2040 | 75.3 | 71.9 | 86.7 |
2050 | 99.4 | 102.7 | 135.3 |
Year | % of TPEC Coming from | ||||
---|---|---|---|---|---|
Coal | Oil | Natural Gas | Nuclear | Renewables (Incl. Hydro) | |
2020 (actual) | 52.4 | 28.0 | 6.4 | 6.6 | 4.6 |
2030 | 43.1 | 23.5 | 13.1 | 4.5 | 15.7 |
2040 | 40.3 | 20.9 | 12.7 | 3.7 | 22.4 |
2050 | 33.0 | 17.0 | 12.1 | 2.8 | 35.1 |
Year | Production (BCM) | Consumption (BCM) | Imports (BCM) |
---|---|---|---|
1990 | 11.6 | 11.6 | - |
2000 | 25.4 | 24.1 | 1.3 |
2010 | 47.4 | 59.0 | 11.6 |
2020 | 23.8 | 60.5 | 36.7 |
2022 | 29.8 | 58.2 | 28.4 |
Using Sector | Total Consumption (BCM) | Share in Total Consumption (%) | ||||||
---|---|---|---|---|---|---|---|---|
1990 | 2000 | 2010 | 2020 | 1990 | 2000 | 2010 | 2020 | |
TOTAL | 12.8 | 27.8 | 50.2 | 34.4 | 100.0 | 100.0 | 100.0 | 100.0 |
Use as Energy | 6.4 | 17.2 | 34.5 | 12.9 | 50.0 | 61.9 | 68.7 | 37.5 |
Power | 3.6 | 8.8 | 27.4 | 10.8 | 28.1 | 31.7 | 54.6 | 31.4 |
Industry a | 0.9 | 3 | 2.5 | 0.7 | 7.0 | 10.8 | 5.0 | 2.0 |
Captive | 1.8 | 5 | 4.5 | 0.9 | 14.1 | 18.0 | 9.0 | 2.6 |
Residential | 0.1 | 0.3 | 0 | 0.4 | 0.8 | 1.1 | 0.0 | 1.2 |
Non-energy Use | 6.4 | 10.7 | 15.7 | 21.5 | 50.0 | 38.5 | 31.3 | 62.5 |
Fertilizer | 5.6 | 8.5 | 13.4 | 17.8 | 43.8 | 30.6 | 26.7 | 51.7 |
Petrochemicals | 0.4 | 0.8 | 1.2 | 3.1 | 3.1 | 2.9 | 2.4 | 9.0 |
Other | 0.4 | 1.4 | 1.1 | 0.6 | 3.1 | 5.0 | 2.2 | 1.7 |
Year | Forecasted Natural Gas Consumption (BCM) | ||
---|---|---|---|
Univariate Forecast (Holt Method) | Multivariate Cochrane–Orcutt Forecasts | ||
BAUS | High-Growth Scenario | ||
2020 (actual) | 60.5 | 60.5 | 60.5 |
2030 | 87.2 | 66.3 | 67.1 |
2040 | 106.9 | 87.6 | 116.0 |
2050 | 128.9 | 132.8 | 202.5 |
Year | Univariate Forecast (Holt Method) | NEP/NITI Aayog Forecasts | BP New Momentum Forecast | |
---|---|---|---|---|
BAUS | Optimistic | |||
2020 (actual) | 23.8 | 23.8 | 23.8 | 23.8 |
2030 | 45.2 | 88.0 | 101.0 | - |
2040 | 48.9 | 95.0 | 124.0 | - |
2050 | 56.4 | - | - | 132.0 |
Disclaimer/Publisher’s Note: The statements, opinions and data contained in all publications are solely those of the individual author(s) and contributor(s) and not of MDPI and/or the editor(s). MDPI and/or the editor(s) disclaim responsibility for any injury to people or property resulting from any ideas, methods, instructions or products referred to in the content. |
© 2024 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https://creativecommons.org/licenses/by/4.0/).
Share and Cite
Ghosh, S.; Majumder, R.; Chatterjee, B. Natural Gas Matters: LNG and India’s Quest for Clean Energy. Gases 2024, 4, 1-17. https://doi.org/10.3390/gases4010001
Ghosh S, Majumder R, Chatterjee B. Natural Gas Matters: LNG and India’s Quest for Clean Energy. Gases. 2024; 4(1):1-17. https://doi.org/10.3390/gases4010001
Chicago/Turabian StyleGhosh, Subhadip, Rajarshi Majumder, and Bidisha Chatterjee. 2024. "Natural Gas Matters: LNG and India’s Quest for Clean Energy" Gases 4, no. 1: 1-17. https://doi.org/10.3390/gases4010001
APA StyleGhosh, S., Majumder, R., & Chatterjee, B. (2024). Natural Gas Matters: LNG and India’s Quest for Clean Energy. Gases, 4(1), 1-17. https://doi.org/10.3390/gases4010001