India’s role as a member of International Energy Agency

In an effort to reflect the rising role of non-OECD economies with major impact on the global energy market, the IEA introduced the “association” status in 2015. Since its inception, China, Indonesia, Thailand, Singapore, Morocco, and now India have become associated with the IEA.

The association status allows these countries to participate in meetings of IEA standing groups, committees, and working parties, without prior invitation. Association countries can work with the IEA on matters of energy security, energy data and statistics, energy policy analysis, and benefit from priority access to IEA training and capacity-building activities.

The IEA and India benefit from a long, ongoing bilateral relationship built on co-operation in a broad range of areas including energy security, statistics, efficiency, market analysis, implementation agreements and technology. The co-operation was first formalised as early as 1998 with the signing of the Declaration of Cooperation covering important issues related to energy security and statistics. Since then the relationship has developed further through the endorsement of three Joint Statements, the last one in 2013.

That Joint Statement covers areas of mutual interest to the IEA and India and helps facilitate co-operation at different levels and under various topics within the energy field.

A priority area for co-operation is oil and gas security, and the IEA and the Ministry for Petroleum and Natural Gas signed a Memorandum of Understanding (MoU) in 2011. This was the first time that the IEA signed a MoU with a key partner country in the area of emergency preparedness.

In 2016, India and the IEA signed a Statement of Intent to enhance co-operation in numerous fields including forecasting and data. In 2016, India and the IEA signed a Statement of Intent to enhance co-operation in numerous fields including forecasting and data, followed by the formal activation of Association in March 2017.

Over the last few years, high level policy dialogue has been more frequent, which was shown when three Ministers participated in the IEA-National Institution for Transforming India (NITI) Aayog workshop in New Delhi to gather expert advice for World Energy Outlook 2015, which features a Special Report on India's energy outlook.

The IEA and India also have a long-standing collaboration in energy efficiency and have organised several joint workshops. In 2015, the IEA together with the Indian Petroleum Conservation Research Association (PCRA) helped bring in international expertise to support the development of regulations for Heavy Duty Vehicles.

The IEA and India also collaborate in renewable energy. In September 2015, the IEA with the support of the Ministry for New and Renewable Energy organised a workshop exploring key considerations for implementing a national wind energy technology roadmap in India.

In March 2017, India activated the association status with the International Energy Agency (IEA). With India’s inclusion, the IEA accounts for about 70% of the world’s energy consumption.

Background

• The International Energy Agency (IEA) is a Paris-based autonomous intergovernmental organization established in the framework of the Organisation for Economic Co-operation and Development in 1974 in the wake of the 1973 oil crisis.
• The IEA was initially dedicated to responding to physical disruptions in the supply of Oil, as well as serving as an information source on statistics about the international oil market and other energy sectors.
• The IEA acts as a policy adviser to its member states, but also works with non-member countries, especially China, India, and Russia. The Agency's mandate has broadened to focus on the "3Es" of effectual energy policy: energy security, economic development, and environmental protection.
• The latter has focused on mitigating climate change. The IEA has a broad role in promoting alternate energy sources (including renewable energy), rational energy policies, and multinational energy technology co-operation.
• IEA member countries are required to maintain total oil stock levels equivalent to at least 90 days of the previous year's net imports. At the end of July 2009, IEA member countries held a combined stockpile of almost 4.3 billion barrels (680,000,000 m3) of oil.
• On 1 September 2015, Faith Birol took office as the new Executive Director, succeeding in this position former Dutch Minister of Economic Affairs, Maria Van der Hoeven.
• The IEA was established to meet the industrial countries' energy organization needs in the wake of the 1973–1974 oil crisis.
• Although the OECD had structures such as the Council, the Executive Committee, the Oil Committee, and the Energy Committee that could potentially deal with energy questions, it could not respond effectively to the crisis.
• The OECD had adopted the Oil Apportionment Decision , laying out procedures to be carried out in the event of an oil supply emergency in Europe, but these procedures were not implemented during the crisis.
• In addition, the OECD had adopted recommendations on oil stockpiling in Europe, but due to their limited scope, these measures could have only a limited role in an oil supply emergency.
• The IEA was created on 18 November 1974 by the Agreement on an International Energy Program (I.E.P. Agreement).
• During its history, the IEA has intervened in oil markets three times by releasing oil stocks – in 1991 during the Gulf War, in 2005 by releasing 2 million barrels per day (320×103 m3/d) for a month after Hurricane Katrina affected US production, and most recently in 2011 to offset continued disruption to oil supplies as a result of the 2011 Libyan civil war.
• In April 2001, the IEA, in collaboration with five other international organisations (APEC, Eurostat, OLADE, OPEC, and UNSD) launched the Joint Oil Data Exercise, which in 2005 became the Joint Organisations Data Initiative (JODI).
• In June 2014 in its World Energy Outlook report, the IAE warned US$48 trillion in investment and credible long term policy planning would be required between 2014 and 2035 to secure sufficient energy supplies for that period.
• "The reliability and sustainability of our future energy system depends on investment. But this won't materialize unless there are credible policy frameworks in place as well as stable access to long-term sources of finance. Neither of these conditions should be taken for granted," van der Hoeven said in a statement accompanying the report.

Member States

• Only the OECD member states can become members of the IEA. Except for Chile, Iceland, Israel, Mexico, and Slovenia, all OECD member states are members of the IEA. In 2014, Estonia joined the IEA and became its 29th member. China, India, Indonesia, Moroccoa, Singapore and Thailand are the associate members of IEA.

IEA Bio-Energy

• IEA Bio-energy was set up in 1978 by the International Energy Agency (IEA) with the aim of improving cooperation and information exchange between countries that have national programmes in bio-energy research, development and deployment.
• The International Energy Agency acts as energy policy advisor to 28 Member Countries plus the European Commission, in their effort to ensure reliable, affordable, and clean energy for their citizens. Founded during the oil crisis of 1973-74, the IEA’s initial role was to co-ordinate measures in times of oil supply emergencies. As energy markets have changed, so has the IEA.
• Its mandate has broadened to incorporate the “Three E’s” of balanced energy policy making: energy security, economic development, and environmental protection.
• Current work focuses on climate change policies, market reform, energy technology collaboration and outreach to the rest of the world, especially major producers and consumers of energy like China, India, Russia and the OPEC countries.
• Activities are set up under Implementing Agreements. These are independent bodies operating in a framework provided by the IEA. There are 42 currently active Implementing Agreements, one of which is IEA Bio-energy.
• Twenty two countries plus the European Commission participate in IEA Bio-energy: Australia, Austria, Belgium, Brazil, Canada, Croatia, Denmark, European Commission, Finland, France, Germany, Ireland, Italy, Japan, Korea, Netherlands, New Zealand, Norway, South Africa, Sweden, Switzerland, United Kingdom, and USA.

IEA Bio- Energy tasks

• The work of IEA Bio-energy is structured in a number of Tasks, which have well defined objectives, budgets, and time frames. The collaboration which earlier was focused on Research, Development and Demonstration is now increasingly also emphasising Deployment on a large-scale and worldwide.
• Each participating country pays a modest financial contribution toward administrative requirements, shares the costs of managing the Tasks and provides in-kind contributions to fund participation of national personnel in the Tasks. The scope of the work undertaken within IEA Bio-energy is shown in the graphic.
• Each Task is led by one of the participating countries (Operating Agent) with technical effort co-ordinated by a Task Leader. The work is directed by the Executive Committee. For the period 2013-2015, there are 10 Tasks. All of the Tasks have a common duration of three years.

Current Tasks

• Task 32 Biomass Combustion and Co-firing
• Task 33 Thermal Gasification of Biomass
• Task 34 Pyrolysis of Biomass
• Task 36 Integrating Energy Recovery into Solid Waste Management
• Task 37 Energy from Biogas
• Task 38 Climate Change Effects of Biomass and Bioenergy Systems
• Task 39 Commercialising Conventional and Advanced Liquid Biofuels from Biomass
• Task 40 Sustainable International Bioenergy Trade: Securing Supply and Demand
• Task 42 Biorefining Sustainable Processing of Biomass into a Spectrum of Marketable Biobased Products and Bioenergy
• Task 43 Biomass Feedstocks for Energy Markets

Development and promotion of energy storage technologies

• The IEA's Energy Conservation through Energy Storage (ECES) Programmehas completed 20 developmental annexes covering seasonal thermal energy storage as sensible heat (or cold), as well as storage of latent heat and electrical energy. Six other annexes are on-going and three are in planning.
• The ECES programme has held triennial global energy conferences since 1981. The conferences originally focused exclusively on STES, but now that those technologies are mature and other kinds of energy storage technology are now also included.
• Since 1985 each conference has had "stock" (for storage) at the end of its name; e.g. Ecostock, Thermastock. They are held at various locations around the world. Most recent was Innostock 2012 (the 12th International Conference on Thermal Energy Storage) in Lleida, Spain. Greenstock 2015 will be held in Beijing.

Carbon Capture

• IEA promotes reduction of CO2 emissions for both conventional fossil-fuel CCS and for bio-energy with CCS (BECCS) by working with member and partner nations on development of cost effective and efficient international and national energy policies including carbon capture and storage (CCS), trading mechanisms and clean low-carbon technologies.
• The 2012 IEA report entitled "A Policy Strategy for Carbon Capture and Storage" argues for comprehensive policy mechanisms that include setting a market price on CO2 emissions as key to reduction of CO2 emissions.
• "In contrast to renewable energy or applications of energy efficiency, CCS generates no revenue, nor other market benefits, so long as there is no price on CO2 emissions.
• It is both costly to install and, once in place, has increased operating costs. Effective, well-designed policy support is essential in overcoming these barriers and the subsequent deployment of CCS technology.

Energy efficiency

At the Heiligendamm Summit in June 2007, the G8 acknowledged an EU proposal for an international initiative on energy efficiency tabled in March 2007, and agreed to explore, together with the International Energy Agency, the most effective means to promote energy efficiency internationally.
A year later, on 8 June 2008, the G8 countries, China, India, South Korea and the European Community decided to establish the International Partnership for Energy Efficiency Cooperation, at the Energy Ministerial meeting hosted by Japan in the frame of the 2008 G8 Presidency, in Aomori.

India’s energy demands

India’s oil consumption has grown at an average annual rate of 5% over the last decade and climbed over 4 million barrels per day for the first time in the year ending in March 2016.

India is currently the world’s fourth-largest oil consumer after the United States, China and Japan, and set to overtake Japan for the third slot within the next 12-18 months.
Diesel remains the largest end market, accounting for more than 40% of all petroleum consumed in the country, according to the Ministry of Petroleum and Natural Gas.
Liquid petroleum gas for cooking and petroleum coke for power generation are other major markets, each accounting for about 10% of final demand.

How this will help India?

• India’s membership in the IEA is a major milestone for India, the IEA, and global energy governance.
• India has had dialogues with the IEA on emergency preparedness in the past, but India’s joining as an association country can facilitate its collaboration with the IEA in developing preparedness for oil supply disruptions and emergencies, including building and maintaining emergency reserves.
• The IEA association can help strengthen India’s capacity building in the areas of energy efficiency, energy technology, renewable energy, electricity security, and grid integration—many of which have been identified by Prime Minister Narendra Modi’s government as key priorities.

How is this significant for IEA?

• For the IEA, India’s participation signifies the evolution of the IEA as a global energy institution that better represents key players in the global energy markets today.
• According to the U.S. Energy Information Administration, non-OECD demand for energy will rise by 71 percent from 2012 to 2040, whereas total energy use in OECD economies will rise by 18 percent during the same period.
• Participation by major energy consumer countries—earlier by China and now by India—helps the IEA increase transparency in the global energy system through improved access to their production and consumption data.
• Also, closer dialogues with energy policymakers and capacity building in India strengthens the IEA’s effectiveness in setting the right agenda today to help address key challenges tomorrow.
• This will be especially relevant as these economies drive global energy trends and affect the global course for combating climate change in the future.
• Given that the IEA is now also the secretariat for the Clean Energy Ministerial (CEM) in which India has participated, joining the IEA will allow all member nations, including India, to work together on clean technology policies.

Way ahead

• Participation in the IEA is by no means a silver bullet for the challenges that India faces. India has a long way to go in providing energy access for its vast population. Today, 245 million Indians lack access to electricity. Also, emergency preparedness is a growing challenge for India, which has only 13 days of net oil import coverage in its Strategic Petroleum Reserve (SPR) as of 2016.
• As India looks to provide universal electricity access and pursues urbanization, its energy demand will double over the next 25 years, contributing to one-fourth of global energy demand growth during that period. Consequently, India is expected to become increasingly reliant on foreign sources of energy, as its import dependence, which is about 80% for crude oil and 40% for natural gas today, will grow.
• Not being a member of the IEA or OECD, India is not subject to any of the preconditions to which the member countries are subjected, including the 90-day oil reserve requirement. However, India and the international community will stand to benefit from India’s collaboration with the IEA on emergency preparedness, as supply disruptions could significantly harm the global economy as well as Indian economy. Specifically, association with the IEA may hasten the development of SPR in India.