Energy security

Topic: Infrastructure: Transport, Communications and Energy · NCERT: Beyond NCERT

Meaning

Energy security means a country has energy that keeps flowing without breaks, at prices people and firms can afford, and an energy system that can survive supply shocks such as wars, sanctions or sudden price spikes.

It matters for India because India imports about 85% of the crude oil it needs. Trouble far away, for example in West Asia, can quickly raise fuel prices, push up inflation and slow growth at home.

Explanation

The three parts of energy security

• Availability. Energy supply does not stop. Fuel and power reach homes, farms and factories without cuts.
• Affordability. Prices stay within what consumers and industry can pay.
• This is why the state supplies electricity to small industries at rates they can afford.

• The government pays part of the cost itself, which is a subsidy.

• Resilience. The system can absorb a shock and recover.

• Examples of shocks: a war, sanctions (trade bans one country puts on another) or a price spike.

What makes a country less energy secure

• High import dependence. The more fuel a country buys from abroad, the more it suffers when foreign supply breaks down.

• India imports about 85% of its crude oil. In 2022-23, imports were about 87% of crude consumption [5].

• Supply from too few places. If most oil comes from one region, one war there can cut supply.

• Thin emergency stocks. If storage is small, a country cannot keep going for long when imports stop.
• Energy that cannot be relied on around the clock. Solar works only in daylight, and wind depends on the weather.
• So renewables reduce import risk.
• But the grid then needs storage or other steady sources for evening and night supply.

The tools that raise energy security

• Strategic petroleum reserves (SPR). These are government-owned emergency stocks of crude oil, kept in underground rock caverns.
• Supplier diversification. Buying oil from many countries means trouble in one region cannot cut off supply.
• Domestic, non-fossil energy. Solar, wind, hydro and nuclear power are produced at home, so India needs to import less fuel.
• New fuels. Green hydrogen (hydrogen made from water using renewable power) can replace imported gas and oil in fertiliser, refining and steel.

Worked example: how big is India's oil buffer?

• SPR Phase I capacity = Visakhapatnam 1.33 + Mangaluru 1.5 + Padur 2.5 = 5.33 MMT (million metric tonnes) [4].
• Crude actually stored (March 2025) = 3.52 MMT [4].
• Share of the caverns in use = 3.52 ÷ 5.33 × 100 ≈ 66%.

• So about one-third of Phase I space was still empty.

• Phase II adds 6.5 MMT [4].

• Total planned SPR capacity = 5.33 + 6.5 = 11.83 MMT.

• Days of cover: all of India's crude and petroleum-product storage equals 74 days of use. The global standard is 90 days [5].

• The shortfall is 90 − 74 = 16 days.

In India

• Strategic petroleum reserves

• Phase I: 5.33 MMT at three sites:

  Site	Capacity
  Visakhapatnam (Andhra Pradesh)	1.33 MMT
  Mangaluru (Karnataka)	1.5 MMT
  Padur (Karnataka)	2.5 MMT

• Stock held: 3.52 MMT of crude as of March 2025 [4].

• Phase II (approved July 2021): 6.5 MMT more, built as commercial-cum-strategic reserves under PPP (public–private partnership, where a private firm builds and runs the asset with the government) [4]. The two sites are:

  • Chandikhol, Odisha: 4 MMT;
  • Padur, Karnataka: 2.5 MMT.

• Storage cover and the 90-day goal

• India's crude and product storage covers 74 days of use [5].

• The Standing Committee on Petroleum and Natural Gas (2025) asked India to reach 90 days of crude storage, which is the global standard [5].

• Shift to non-fossil power

• Installed capacity was 505 GW as on 31 October 2025. Non-fossil sources made up over 259 GW of this [3].
• In June 2025, non-fossil sources reached 50% of installed capacity. This met India's NDC target early. The NDC (Nationally Determined Contribution) is India's climate pledge under the Paris Agreement, and this target was set for 2030 [2].
• The non-fossil share rose from 32% (2014) to 51% (October 2025) [1].

• Next goal: 500 GW of non-fossil capacity by 2030.

• National Green Hydrogen Mission (2023)

• It aims to replace imported gas and oil in fertiliser, refining and steel with green hydrogen.

• Nuclear Energy Mission (Budget 2025-26)

• Target: 100 GW of nuclear capacity by 2047 [7].

• ₹20,000 crore to develop at least five indigenous Small Modular Reactors (SMRs) by 2033 [7]. SMRs are small nuclear reactors built from factory-made parts.

• Rooftop solar

• Power made on rooftops is used where it is made, so less has to come from coal plants.

• PM Surya Ghar Muft Bijli Yojana (2024): outlay of ₹75,021 crore, with a target of 1 crore households getting up to 300 free units a month [6].

• Who governs power

• Electricity is entry 38 of the Concurrent List, so both Parliament and the state legislatures can make laws on it.
• The Electricity Act 2003 is the main law, and the CERC and SERCs regulate tariffs.

Don't confuse with

• Energy self-sufficiency. This means producing all your energy at home. Energy security does not need zero imports. A country can import a lot and still be secure if it has many suppliers and large reserves.
• Installed capacity share vs generation share. Non-fossil sources are 50% of installed capacity [2], which is the most all plants could produce at one moment. Their share of the units actually produced is much smaller, and coal still produces most of India's electricity.
• SPR vs total storage cover. The SPR is only the government's emergency crude stock in caverns (5.33 MMT in Phase I) [4]. The 74 days figure counts all crude and petroleum-product storage in India [5].
• Energy access. Energy access means every household is connected to energy supply, for example through rooftop solar under PM Surya Ghar. Energy security is about the whole country's supply staying steady, affordable and shock-proof.

Prelims Hooks

• SPR Phase I = 5.33 MMT: Visakhapatnam 1.33 + Mangaluru 1.5 + Padur 2.5. Phase II (approved July 2021) adds Chandikhol (4 MMT) and Padur (2.5 MMT) under PPP [4]. Trap: Padur appears in both phases, but Chandikhol (Odisha) is only in Phase II.
• India imports about 85% of the crude oil it needs, and about 87% of crude consumption in 2022-23 [5].
• Storage cover is 74 days, while the global standard is 90 days. The Standing Committee on Petroleum and Natural Gas (2025) asked India to reach 90 days [5].
• Non-fossil sources reached 50% of installed capacity in June 2025, meeting the 2030 NDC target early. Trap: this is a share of capacity, not of generation [2].
• Nuclear Energy Mission (Budget 2025-26): ₹20,000 crore for at least 5 indigenous SMRs by 2033, and 100 GW of nuclear capacity by 2047 [7].
• National Green Hydrogen Mission was launched in 2023. Green hydrogen is made from water using renewable power.

Mains Points

• Energy security has two sides: oil and power.
• Oil: about 85% import dependence and only 74 days of storage, against a 90-day global standard [5], leave India exposed to shocks such as those in West Asia.
  • An oil shock raises the import bill, which widens the current account deficit (the gap between what India pays abroad and what it earns from abroad).
  • It also pushes up fuel prices and inflation.

• Power: the 50% non-fossil capacity share [2] cuts import risk. But it creates new needs:

  • firm, round-the-clock supply through storage, nuclear and flexible coal;
  • secure supply chains for critical minerals, the minerals needed for batteries and solar panels.

• Building buffers and diversifying.

• Filling and expanding the SPR (Phase II under PPP) [4] and buying from many countries both reduce the damage when one supplier fails.
• The Green Hydrogen Mission and the Nuclear Energy Mission (100 GW by 2047) [7] replace imported fuel with energy made at home.

• This links to SDG 7 (affordable and clean energy) and to India's climate commitments.

• Security needs financially healthy discoms (distribution companies).

• Discoms that lose money delay payments to generators, and this weakens new investment in power supply.
• Lower AT&C losses (the share of power supplied that is never paid for), which fell from 21.91% (FY21) to 16.16% (FY25, provisional) [1], together with RDSS smart meters, make the power supply chain more reliable.
• The trade-off is affordability against cost recovery. Subsidised power helps poor households, but discoms must still recover their costs to keep supply steady.

Related concepts

• Energy infrastructure
• Plant load factor
• Aggregate technical and commercial losses
• Power purchase agreement
• Cross-subsidy
• Open access (electricity)
• Time-of-day tariff
• Feed-in tariff
• Levelised cost of electricity
• Grid parity

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