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National Energy Policy: NITI Aayog proposes nodal energy ministry to streamline governance

NEW DELHI: The NITI Aayog has proposed a common nodal energy ministry on the lines of the model followed in various other countries to streamline governance among different ministries and departments pertaining to the crucial sector and speed up decision-making.

The Aayog, the government’s premier think tank, has included the proposal in its second draft of the National Energy Policy following suggestions from its vice chairman Rajiv Kumar.

If implemented, the proposal would help sort out governance issues among the ministries of petroleum and natural gas, power, coal, new and renewable energy, and the Department of Atomic Energy.

The first draft of the National Energy Policy, under the then vice chairman Arvind Panagariya, did not touch upon the issue of streamlining governance in the energy sector. The second draft is awaiting inter-ministerial comments, following which the National Energy Policy is expected to be finalised.

The Narendra Modi-led government made a start in this direction when Piyush Goyal was given charge of three ministries, namely power, coal, and new and renewable energy in 2016. However, the petroleum and natural gas ministry continued to be headed by a different minister, with the result that governance issues persisted among the multiple ministries.

The Department of Atomic Energy, due to security reasons, continued to be under the control of the Prime Minister.

The Aayog has proposed setting up of a single, all-powerful nodal ministry, under which all existing ministries can be subsumed, said a senior government official.

“With one common ministry all crucial decisions would be taken unilaterally, with no inter-ministerial differences, which in turn would speed up the reform process in the sector,” said the official, who did not wish to be identified.

He said the government would need strong political will to accept the proposal of a unified ministry since it would have far reaching implications.

The National Energy Policy, which has been in the works since 2015, will replace the Integrated Energy Policy of the erstwhile United Progressive Alliance government and lay the road map for the government’s push towards clean energy and reducing fuel imports.

The broad objectives of the policy are enhanced energy independence, increased access at affordable prices, greater sustainability and higher economic growth.

The policy is expected to focus on aligning energy prices with those in the international market so that prices across sectors are market-driven and subsides are limited to identified beneficiaries via direct benefit transfer.

As per the draft policy, the period 2017-2040 is expected to witness a quantum leap in the use of renewable energy, drastic reduction in energy intensity, doubling of per capita energy consumption and tripling of per capita electricity consumption.




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