Demand for conventional fuels to rise despite electric vehicles: Pradhan

Petroleum Minister said in the next few years, India will see at least 25% of the overall global conventional fuel demand growth

Getting into the debate over electric vehicles (EVs), Minister for Petroleum and Natural Gas Dharmendra Pradhan on Tuesday said that the introduction of EVs would not mean the end of conventional fuel as its demand would also increase. Pradhan added that the country should work on a multi-source energy model.   

The minister said that in the next few years, India will see at least 25 per cent of the overall global conventional fuel demand growth. "Even after the introduction of EVs, refineries will still be required as demand for conventional fuel is also going to increase for some years," Pradhan said on the sidelines of a KPMG summit in Delhi.  

The debate over EVs gathered momentum after Minister for Road Transport & Highways Nitin Gadkari said that by 2030, India would switch to 100 per cent electric mobility. Following this, Minister of Railways Piyush Goyal, too, indicated that the national transporter would switch to 100 per cent electric locomotives by 2022, raising concerns among industry about a possible decline in demand for conventional fuel. 

"Out of the overall world primary energy, India consumes only six per cent. Considering the market size and growth rate, India definitely requires a multi-source energy strategy, which includes renewables, conventional, coal, and even nuclear. Hence, the incremental requirement of conventional fuel will be there," Pradhan added. 

The minister further added that in terms of technology, the Bharat Stage VI fuel that is going to be launched in Delhi next year will be at par with compressed natural gas (CNG). "We even have cleaner technology for coal with zero emission and a lot is happening on bio-fuel too," he said. 

He added that since he holds the charge of the skill development minister too, he is also working in tandem with energy ministries for 100 per cent electrification of households. "Out of the Rs 16,000 crore scheme, about Rs 6,000 crore will be spent on labour only and that too in 200 districts covering six states. Hence, we are working on creating skilled labour too," he said. 

Meanwhile, the minister also reiterated the demand for the inclusion of natural gas under the Goods and Services Tax (GST) regime. "Coal is included in GST at five per cent slab. Despite being a much cleaner fuel, natural gas is not. It should be there," Pradhan said.