The recent launch of the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline, an 1,800 km pipeline bringing natural gas from the Turkmenistan to India, is seen as a source of long-term energy security for India. The pipeline, once completed, would supply about 15 Billion Cubic Meters (BCM) of gas per year to India, fulfilling about a quarter of India’s projected gas demand. Analysts, however caution that, India does require a clear gas policy to mandate the usage of such a quantum of gas in the country. The government should signal some interest in gas, they insist. That mandate can play a big role in espousing the use of gas, a relatively far cleaner fuel than coal. Given the recent pro-activism shown by the judiciary and the National Green Tribunal towards cleaner environment, gas based power generation is likely to be promoted (especially near big cities) by the government. “The biggest benefit that I see from this pipeline is in terms of reduction of carbon emission,” says Lydia Powell, energy analyst, Observer Research Foundation.
If the pipeline is built then India would be able to leverage the greenhouse potential of gas. 1% replacement of coal by gas-based power generation can achieve the same amount of carbon emission reduction as an 11% increase in renewable capacity, says a research by Observer Research Foundation. “India needs at least a ten-year-policy (mandate) on the gas usage otherwise imported gas, at hopefully above $10/ Unit, would not be able to replace coal,” says Powell. She adds that for any gas pipeline to succeed, it needs big anchor customers like power producers or big industries. Given that the Indian power distribution sector remains largely subsidised, the Indian government should mandate our industries to use the imported gas as Indian industries have the capacity to use gas priced above $10 per unit. The domestic gas can then be diverted towards the subsidised power generation sector.
India’s consumption of gas in 2013 was about 45 BCM with domestic production of 35 BCM. India’s domestic demand is projected to grow to about 58 BCM by 2020. So, the supply of 15 BCM from TAPI pipeline can meet a quarter of India’s demand. Many international observers feel that the pipeline’s security would have its own cost, which together with paying transit fees to Pakistan, would further enhance the landed price of gas for India. Mriganka Jaipuriyar, energy expert with Platts, feels that the Afghan leg of the pipeline would require about 7,000 soldiers which can increase the construction and operational cost of the pipeline. Since TAPI would also be supplying gas to Pakistan — whose need for gas is far more acute than India — they are expected to show every interest for securing the safety and security of this pipeline.