Mohan Bhupathiraju's Blog !

Adapting electricity in place of LPG/Kerosene for household cooking can save ₹ 70,000 Cr Per year to India’s exchequer

Indian Government can save ₹ 70,000 Cr subsidy bill/under recoveries and drastically reduce their import bill by promoting Electricity based cooking in place of LPG/Kerosene based cooking.

High Import bill of LPG and Kerosene:

India has imported (net import) 6.09 million tons of LPG for domestic consumption for FY 2012-13 and imported 1.4 million tons of Kerosene in FY 2010-11. Oil & Natural gas products form the single largest component of India’s trade deficit (approximately 5% of GDP). These imports also negatively impact the value of the Indian Rupee against the USD.

Challenges for electric cooking:

As per 2011 Indian Government Census data, around 32% of Indian households use either LPG or Kerosene as fuel for cooking.

India households by primary fuel used for cooking Percentage
Fuel Type Total Rural Urban
Firewood 49.0 62.5 20.1
Crop residue 8.9 12.3 1.4
Cowdung cake 7.9 10.9 1.7
Coal, Lignite, Charcoal 1.4 0.8 2.9
Kerosene 2.9 0.7 7.5
Liquefied Petroleum Gases/Piped Natural Gas 28.5 11.4 65.0
Electricity 0.1 0.1 0.1
Bio-gas 0.4 0.4 0.4
Any other 0.5 0.6 0.2
No cooking 0.3 0.2 0.5
Source: India Census 2011

The challenge to adapt to electricity for cooking is that over 300 million of the population has no access to a reliable supply of electricity in India and most of the states and UT’s experience frequent power cuts due to supply shortages. Fixing the distribution losses and adding generation capacity to fill the gaps on supply side are the main priorities of the PM Narendra Modi, as indicated by Government sources several times, and as such this problem will be overcome sooner or later.

As indicated above, although Central Government is working hard to provide 24/7 power supply to most of India by 2019, as of now only Gujarat has 24/7 power supply for domestic use. Rajasthan and Andhra Pradesh states were also being considered for uninterrupted domestic power supply by end of 2014.

Pilot project to study feasibility:

In the West and developed countries, electric cooking has been a major part of household cooking for a long time. It doesn’t surprise that at present only 0.1% of Indian households are using electricity for cooking due to unreliable power supply and lack of adequate knowledge on electric cooking. As a pilot project, the Central Government should promote electric cooking in place of LPG/Kerosene based cooking in Gujarat in order to evaluate feasibility, challenges, and potential savings to implement it across the country at a later stage in phased manner.

Win-Win for Government and People:

Let us do some simple math to calculate the long-term savings achieved through shifting from traditional LPG/Kerosene based cooking to electricity based cooking. Per each cylinder, the Indian Government is providing around ₹ 400 as Subsidy (or) as under recovery. On average, a family uses 8 Cylinders per year i.e. whopping ₹ 3200 subsidy per family per year.

Instead of bearing a ₹ 3200 subsidy per family, per year, and every year, the Government may give electric stoves/Induction cookers once, free of cost to these families (Electric stoves/Induction cookers cost ₹ 1000 to ₹ 2500 per piece). Electric cooking also minimizes the overall fuel cost of cooking for households. As an example: Cost of heating 10 liters of water is ₹ 11 with subsidized LPG, ₹ 5.5 with Induction cooktop, and ₹ 6 with Electric coil cook top (these are approximate amounts based on variations in the power tariffs of different states, the actual costs may vary).

So, electric cooking is cheaper compared to LPG, even with the subsidy intact for later (Electric cooking is also cheaper compared to unsubsidized kerosene). And, it is also clean, safer, and hassle free (you no need to change cylinders every month or take care of loose connections of cylinder pipes to name a few) compared to LPG cooking. More details on this have been well explained here

Due to its various advantages, people will easily shift from LPG to electric cooking, provided adequate measures are implemented by the Government. Even if people partially shift from LPG to electric cooking, it’s still good for the economy, as each cylinder costs ₹ 400 to the Indian Government and also negatively impacts import bills.

Remember, only 29% of the Indian households are using LPG as per the 2011 Census. This percentage is going to increase as more and more people shift to LPG from other traditional cooking methods. If effective alternative methods are not provided, the Government subsidy burden and Imports bills will go up further and adversely impact the Indian exchequer.

Once electric cooking is well-promoted and subsidies on LPG/Kerosene are cut gradually, it will have a cyclical effect on overall fuel usage methods for cooking across the country. And, finally, India can be free from this age old economic menace created by subsidies & imports of cooking fuels in a few years’ time, down the line.

Not just for energy security, but for national security:

liquids_imports

Most Oil and Gas imports are from Middle Eastern countries. It’s an open secret that Oil money is the single biggest source of funds for Islamic radicalization and Jihadi terrorism across the world. India has been the victim of this for a long time, and Indian Muslims are being radicalized by the Wahhabism aggressively promoted by Saudi Arabian oil rich coffers. If you see the whole picture, it is like we are funding our own fall with our ever increasing needs of Oil and Gas. It has to be stopped somewhere, sooner than later, not just for economic stability and energy security of India but also for India’s national security.

 

 

 

References used to research statistics:

Powerless: India’s Energy Shortage and Its Impact (Book) By Sam Tranum
https://www.bijlibachao.com/appliances/cooktop-comparison-gas-electric-and-induction.html
http://www.eia.gov/countries/cab.cfm?fips=in
http://www.ijmrbs.com/ijmrbsadmin/upload/IJMRBS_50e55b20ee796.pdf

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