National Energy Policy
This Policy is prepared by the Ministry of Energy and Power Development (MOEPD) to provide a framework for the exploitation, distribution and utilization of energy resources to fulfil the five broad policy principles (also known as five A's):
- to increase the access of all sectors of the economy to affordable energy through the optimal use of available energy resources and diversification supply option (applicability, availability, acceptability and affordability);
- to stimulate sustainable economic growth by promoting competition, efficiency and investment in the sector (applicability and accountability);
- to improve the institutional framework and governance in the energy sector (accountability);
- to promote research and development in the energy sector (applicability);
- to develop the use of other renewable energy sources of energy to complement conventional sources of energy (applicability and acceptability).
The policy objective is to create and promote a conductive environment for energy sector players to be able to identify ad develop opportunities for energy supply that promote sustainable development. The demand side section of the policy highlights the issues in the context of the five demand sectors: agriculture, industry and mining, commerce and services, transport and households (both urban and rural). Focuses include the efficient use of energy in carrying out economic activities and promoting of fuel-wood substation. The supply side refers to the use of coal, petroleum products, electricity, gas and renewable energy. It calls for the sustainable use of biomass resources (e.g. wood fuel, industrial waste such as bagasse and pulp), hydropower, solar power and wind power. Hydropower is currently contributing to the national grid, and the document identifies its potential contribution to rural power needs. It also promises that the underutilized solar power will be developed, both for solar electricity and solar heat. Policy measures specific to renewable energy includes: to adopt a long-term government-driven, renewable energy technologies (RETs) programme, which encourages IPPS and public-private partnerships to harness sustainable RETs; to institute innovative funding mechanisms and finance opportunities such as Clean Development Mechanisms, feed-in-tariffs and micro-credit institutions for RETs; to institute RETs-sustainable capacity building programmes; to raise awareness about the benefits and opportunities of renewable energy; to encourage local production and the commercialisation of technologies; to strengthen the institutional framework for research and development and the promotion of renewable energy technologies; to promote investment into standalone solar energy systems to cater four rural communities; to promote efficient use of biomass for cooking; to encourage the use of waste biomass for energy purposes; and to develop incentives for investment in renewable energy (such as subsidies and tax concessions).
A minimum ethanol/petrol blend target of 20% by 2015, and a 5% biodiesel blend by 2020