Future-Proofing India’s Energy Security

This editorial is based on “From energy scarcity to abundance ” which was published in The Financial Express on 02/01/2026. This article highlights how the world is transitioning towards an era of energy surplus fueled by technological innovation, presenting India with a key opportunity to reduce its reliance on imported oil.

For Prelims: PM KUSUM,PLI Schemes,Green Hydrogen ,Battery Energy Storage Systems (BESS),Renewable Energy  

For Mains: India’s energy security, key issues in energy sector and measures 

India’s energy security is a critical determinant of its economic stability, strategic autonomy, and developmental trajectory. As the world’s third-largest energy consumer, India meets nearly 85% of its crude oil, over 50% of its natural gas, and around 25% of its coal requirements through imports, exposing the economy to global price volatility and geopolitical shocks. With energy demand projected to double by 2040, driven by urbanisation, industrialisation, and rising incomes, the challenge is to ensure energy availability that is affordable, reliable, and sustainable. Simultaneously, India has committed to achieving 500 GW of non-fossil fuel capacity by 2030 and net-zero emissions by 2070, underscoring that energy security today is inseparable from clean energy transition, diversification of supply sources, and technological self-reliance. 

What is the Current Status of India's Energy Mix? 

• Energy Demand: India is currently the third-largest energy consumer globally, accounting for about 6–7% of global primary energy demand. Rapid urbanisation, industrial expansion, rising incomes, and electrification of transport and households are driving demand upward. 
  • India’s total energy demand is expected to nearly double by 2040, making energy availability a core development issue.  
• Primary Energy Mix: India’s total primary energy consumption comprises various fuel sources, reflecting both traditional and modern energy demand across sectors (industry, transport, residential, commercial). According to recent International Energy Agency estimates: 
  • Coal: ~46% of total energy supply, 2023 
  • Oil (Petroleum & other liquids): ~25% of total energy supply, 2023 
  • Natural Gas: ~5% of total energy supply, 2023 
  • Renewables: 22% share of power generation, 2022 

What are the Key Developments in India's Energy Sector? 

• Achievement of Near-Universal Electricity Access: One of the most transformative achievements of India’s energy sector has been the near-universalisation of electricity access.  
  • As per recent data from the Ministry of Power, all villages and households are now electrified, marking a historic milestone in rural development. 
    • This has led to rise in India’s per capita electricity consumption ( 18,410 MJ/person in FY 2023–24).This reflects improved access and living standards, and despite remaining below the global average, signals steady progress toward energy equity. 
  • Rural electrification has enabled irrigation, cold storage, digital connectivity, education, and healthcare services, directly improving productivity and quality of life.  
• Acceleration in  Clean Energy Transition: India recorded its highest-ever renewable capacity addition of 44.5 GW till November 2025, almost doubling last year’s additions. As a result, non-fossil sources now account for over 51% of installed power capacity, enabling India to achieve its Paris Agreement targets ahead of schedule. 
  • Key initiatives driving India’s clean energy transition include PM-KUSUM, Green Energy Corridor, PLI Schemes for Solar PV and PM E-DRIVE Scheme.  
    • Also, the Sustainable Alternative Towards Affordable Transportation (SATAT) initiative is turning agricultural waste into a strategic energy asset, tackling air pollution while reducing LNG imports. 
• Substantial Progress in Energy Storage: Recognizing that intermittency is the primary barrier to a green grid, India has pivoted from mere power generation to massive energy storage execution.  
  • This "inflection point" ensures that renewable energy can provide firm, dispatchable power for industrial and peak-hour demands. 
  • For instance, India's battery energy storage capacity is set to rise nearly ten-fold to around 5 GWh in 2026 from 507 MWh in 2025. 
• Improved Grid Strength and System Reliability: The "One Nation, One Grid, One Frequency" framework has evolved into a high-capacity highway for green energy, drastically reducing regional power deficits and price volatility.  
  • Green Energy Corridors and digital grid management systems have improved system flexibility and reduced outages.  
  • The ability of renewables to meet over half of daily electricity demand on certain peak days demonstrates growing system maturity. 
    • The Central Electricity Authority (CEA) estimates that regional interconnections could grow by 50 per cent by 2030, enabling India to export surplus renewable power. 
• Growth of Decentralised and Distributed Energy Systems: Decentralised energy solutions have expanded rapidly, particularly in rural and agricultural areas.  
  • Rooftop solar, solar pumps, and microgrids are reducing transmission losses and empowering communities with local energy generation.  
    • For instance, Under the PM Surya Ghar: Muft Bijli Yojana, rooftop solar installations have covered 26,76,432 households, creating a cumulative installed capacity of 7,879.07 MW. 
  • These systems enhance energy resilience, support farm incomes, and promote sustainable rural livelihoods  
• Advancement Towards Biofuels and Ethanol Parity: India is aggressively pursuing fuel autonomy by converting its agricultural surplus into high-octane fuels, effectively turning the farm sector into an energy hub.  
  • The acceleration of the 20% ethanol blending target (E20) is a dual-purpose strategy for forex conservation and rural wealth creation.  
  • For instance, more than 1,000 crore litres of ethanol have been blended during the Ethanol Supply Year (ESY) 2024–25, while blending touched 19.97% in October 2025. 
• Nuclear Renaissance and SMR Adoption: Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025 marks a historic opening of the nuclear sector to private investment.  
  • By focusing on Small Modular Reactors (SMRs), India aims to provide reliable, carbon-free base-load power for hard-to-abate heavy industries.  
  • The Union Budget 2025-26 allocated ₹20,000 crore for the Nuclear Energy Mission, targeting 100 GW by 2047. 
• Green Hydrogen Push: India is leveraging its ultra-low renewable energy costs to become a competitive global exporter of green molecules, targeting the total decarbonization of fertilizer and steel.  
  • The National Green Hydrogen Mission is moving from a policy framework to physical commissioning of dedicated coastal "Hydrogen Hubs."  
    • Three major ports- Deendayal Port Authority (Gujarat), V.O. Chidambaranar Port Authority (Tamil Nadu), and Paradip Port Authority (Odisha), were recognized as Green Hydrogen Hubs in October 2025.

What are the Key Issues Associated with India's Energy Sector? 

• Continued Dependence on Fossil Fuels: Despite renewable growth, oil still accounts for around 27% of primary energy consumption, and India imports about 85% of its crude oil needs.  
  • This exposes the Indian economy to global price volatility and external shocks, impacting inflation, trade balance, and fiscal stability. Despite strides in diversifying energy sources, India’s reliance on imports remains deeply entrenched. 
  • Also, coal remains India's largest single source, with an installed capacity of 219 GW. 
    • This dual dependence, on imported fuels and domestic coal, highlights the challenges of ensuring energy security, managing environmental impacts, and accelerating the transition toward cleaner and more sustainable energy sources. 
• Renewable Generation vs. Capacity Utilisation Gap: Though non-fossil fuel capacity has exceeded 50% of total installed power capacity, actual renewable electricity generation is lower due to intermittency and storage limitations. 
  • Renewables currently contribute about 20–25% of total electricity generation (~22% of electricity in 2024-25), highlighting a gap between installed capacity and reliable power output . 
  • Seasonal variability, limited energy storage, and grid balancing challenges continue to constrain utilisation. 
• Grid Integration and Infrastructure Limitations: The rapid addition of renewable capacity places stress on transmission and distribution infrastructure.  
  • Integration of variable solar and wind resources requires enhanced grid flexibility, better forecasting, and expanded transmission networks across states.  
    • For instance, more than 50 GW of installed renewable capacity remains under-utilised due to transmission bottlenecks, where generation assets are technically ready but power cannot be evacuated efficiently because transmission lines, substations, and evacuation corridors have not expanded in step with capacity additions.  
  • While investments in Green Energy Corridors and smart grid technologies are underway, delays in implementation and inter-state coordination issues can hinder smooth renewable integration. 
• Land Acquisition and Right-of-Way (RoW) Conflicts: Securing large, contiguous parcels of land for "Giga-scale" solar parks is increasingly sparking community opposition and legal battles over fertile agricultural soil and grazing rights.  
  • These "green-on-green" conflicts are delaying project commissioning and forcing developers into expensive litigation that erodes the low-tariff advantage of renewable energy.  
  • For instance, In June 2025, thousands of farmers staged protests against the government’s plan to acquire 8,300 acres of fertile land for a solar project near Ramayapatnam Port in Andhra Pradesh. 
• Financial Stress in Electricity Distribution Companies: Many state distribution companies (DISCOMs) continue to face financial stress due to high Aggregate Technical & Commercial (AT&C) losses, cross-subsidies, and delayed payments to generators.  
  • The aggregate technical and commercial (AT&C) losses of Discoms widened to 17.6% in FY24 from 15.4% in FY23. 
  • This affects their ability to invest in infrastructure, procure power efficiently, and implement reforms.  
  • Although recent policies promote tariff rationalisation and smart metering, DISCOM viability remains a core challenge to sectoral efficiency. 
• Underdeveloped Natural Gas Market: Natural gas currently accounts for only 6.8 % of primary energy consumption, well below the government’s target of 15% by 2030. 
  • Infrastructure constraints, limited pipeline networks, and historically high LNG prices have slowed growth in gas demand. 
  • A robust natural gas ecosystem is important for cleaner industrial processes, power generation, and reduced carbon intensity, but progress has been slower than anticipated. 
• Environmental and Climate Pressures: India’s energy sector is a major contributor to air pollution and carbon emissions.  
  • Although India’s power sector CO₂ emissions fell by 1% year-on-year in the first half of 2025, the sector continues to be a major contributor to air pollution and carbon emissions.  
  • Balancing economic development with environmental objectives continues to be a complex policy challenge. 
  • Also, the persistent delay in installing Flue Gas Desulphurization (FGD) technology across coal-fired plants continues to jeopardize national air quality and public health. 
• Supply Chain Vulnerability and Critical Mineral Risks: India’s heavy reliance on imported critical minerals for EV batteries and high-efficiency solar cells exposes the energy transition to severe geopolitical shocks and "resource nationalism." 
  • The recent 2025 export restrictions on rare-earth magnets by major global suppliers (like China) have already forced Indian automakers to slash production targets, highlighting a single point of failure.  
    • For instance, In mid-2025, Maruti Suzuki had cut near-term production targets for its maiden electric vehicle e-Vitara by two-thirds because of rare earths shortages. 

What Measures can India Adopt to Strengthen its Energy Security? 

• Diversifying the Energy Mix to Reduce External Vulnerabilities: A key pillar of energy security is diversification. Currently, India imports nearly 85% of its crude oil and over 50% of its natural gas, making it vulnerable to geopolitical tensions and global price shocks. 
  • Expanding the share of renewable energy, nuclear power, and domestic coal with cleaner technologies can reduce dependence on imported fuels.  
  • India’s achievement of over 50% non-fossil fuel capacity demonstrates that diversification is already underway and must be accelerated . 
• Strengthening Grid Infrastructure and Energy Storage: Energy security is not only about generation but also about delivery. Investments in inter-state transmission networks, Green Energy Corridors, and smart grids improve system flexibility and resilience.  
  • Energy storage through pumped hydro, battery storage, and emerging technologies is essential to manage renewable intermittency and meet peak demand.  
• Enhancing Domestic Energy Production and Strategic Reserves: Boosting domestic production of coal, oil, and gas remains important for near- and medium-term security.  
  • At the same time, expanding Strategic Petroleum Reserves (SPRs) helps buffer short-term supply disruptions. 
  • India’s existing SPR capacity, covering several days of imports, is being expanded (eg, Padur in Karnataka and Chandikhol in Odisha)  to improve resilience against global supply shocks, which is a significant step in the right direction.  
• Improving Energy Efficiency and Demand-Side Management: Energy security can be strengthened not only by increasing supply but also by reducing waste. India’s energy intensity has declined significantly over the last decade due to efficiency measures.  
  • Programs promoting LED lighting, efficient appliances, industrial energy audits, and time-of-day pricing help moderate demand growth.  
  • Lower energy intensity reduces import dependence and infrastructure stress while supporting sustainable growth  
• Electrification of Transport and Promotion of Alternative Fuels: Transport remains India’s largest oil-consuming sector. Accelerating electric mobility, supported by renewable-powered charging infrastructure, can substantially reduce oil imports.  
  • In parallel, biofuels, ethanol blending, compressed biogas, and green hydrogen can diversify fuel options for transport and industry. 
  • India’s ethanol blending programme has already crossed 20% blending, reducing crude oil imports and enhancing fuel security. 
• Strengthening Distribution Sector and Market Reforms: Financially viable and efficient DISCOMs are essential for energy security. Ongoing reforms such as smart metering, tariff rationalisation, reduction in AT&C losses, and market-based electricity trading improve reliability and attract investment. 
  •  A robust distribution sector ensures that energy generated is efficiently delivered to consumers without systemic stress.  
• Building Domestic Manufacturing and Technological Self-Reliance: Energy security is closely linked to technological self-reliance.  
  • Expanding domestic manufacturing of solar modules, batteries, electrolysers, and power equipment under Production Linked Incentive (PLI) schemes reduces dependence on imports and strengthens supply chains.  
  • This also creates jobs and positions India as a global clean energy hub.  
• Integrating Energy Security with Climate and Strategic Goals: India’s long-term energy security aligns with its commitments of net-zero emissions by 2070. Clean energy expansion, electrification, and efficiency improvements ensure that rising energy demand does not undermine environmental stability. 
  • Energy diplomacy, diversified import sources, and regional power cooperation further strengthen India’s strategic position 

Conclusion:  

India’s energy transition strongly advances SDG 7 (Affordable and Clean Energy) by achieving universal electrification and rapidly expanding non-fossil power capacity beyond 50%. By reducing import dependence, improving grid reliability, and promoting efficiency and clean technologies, energy is becoming a driver of inclusive growth rather than a constraint. The coming decade will determine how effectively India converts this momentum into long-term security, affordability, and sustainability. 

Drishti Mains Question

“India’s energy security has evolved from ensuring access to building resilience and sustainability.” Examine this statement in the context of India’s changing energy mix and clean energy transition.

FAQs 

1.What is India’s current energy transition focus? 
Shifting from fossil-fuel dependence to renewable-led, secure, and sustainable energy.

2.Which SDG is most directly linked to India’s energy sector reforms? 
SDG 7 – Affordable and Clean Energy.

3.Why are renewables important for India’s energy security? 
They reduce import dependence and price volatility.

4.Has India achieved universal electrification? 
Yes, all households now have electricity access.

5.What is India’s key clean energy target for 2030? 
Achieving 500 GW of non-fossil fuel power capacity. 

UPSC Civil Services Examination, Previous Year Question (PYQ)

Prelims

Q. With reference to the Indian Renewable Energy Development Agency Limited (IREDA), which of the following statements is/are correct? (2015)

1. It is a Public Limited Government Company.   
2. It is a Non-Banking Financial Company.   

Select the correct answer using the code given below:   

(a) 1 only   

(b) 2 only   

(c) Both 1 and 2   

(d) Neither 1 nor 2   

Ans: (c)  

---

Mains

Q. “Access to affordable, reliable, sustainable and modern energy is the sine qua non to achieve Sustainable Development Goals (SDGs)”.Comment on the progress made in India in this regard. (2018)