India faces a potentially grim energy outlook, with the Paris-based International Energy Agency (IEA) predicting that by 2020, oil will cost about US$100 a barrel and the country will emerge as the world's third largest energy spender. Oil accounted for 30% of India's total imports of US$280 billion last year, and a staggering 85% of its trade deficit.
One way to reduce dependence on oil would be to generate more fuel from biomass, such as forest waste, cow dung and molasses. Those and other biological materials already supply a third of the country's primary energy needs, providing cooking and heating fuel especially in electricity-starved rural areas. But burning traditional biomass can be harmful to human health and the environment, and is not particularly energy-efficient. But the Indian government is banking on biomass, installing safer and more environmentally friendly biogas plants across the country. More help is on the way from new technologies that promise to produce energy from nonfood crops and forest waste that have previously been difficult to convert. However, the biomass promise calls for prudent energy pricing and buy-in at the village level, India Knowledge@Wharton learns from experts.
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