As the global energy landscape undergoes a seismic shift towards sustainability, innovation, and a collective awakening towards climate crisis, ES Ranganathan, a well-known energy expert and former Director (Marketing) of GAIL, offers compelling insights into the future of India's oil and energy industries for the year 2024. His forward-thinking perspectives and astute predictions shed light on the transformative trends poised to redefine the nation's energy trajectory. Anticipating a series of transformative changes in India's oil and energy sectors in 2024, ES Ranganathan mentions, “Escalating momentum towards renewable energy sources can see a substantial surge in investments and initiatives geared towards bolstering solar, wind, and other green energy endeavours. Paradigm shifts in energy consumption patterns, along with the technology advancements are going to be pivotal.”
In the second quarter of FY 2023-24, India's Ministry of Commerce and Industry revealed a 9% surge in Foreign Direct Investment (FDI) within the nation's renewable energy sector. FDI soared to $505 million during Q2, up from $461.51 million in the same quarter of the previous fiscal year. Noteworthy growth in FDI was witnessed across various market segments, including solar, pumped hydro storage, and wind projects. This growth aligns with India's ambitious goals, as the Government has pledged investments worth 36.6 lakh crore. This commitment aims to support India's target of adding 40 GW of renewable energy capacity by 2024-2025, aiming for an annual addition of 50 GW in renewable energy projects. Furthermore, Ranganathan highlights the increasing role of electric vehicles (EVs) in India's energy landscape. He predicts a notable rise in EV adoption, propelled by government incentives, technological advancements, and a growing environmental consciousness among consumers. Ranganathan anticipates this shift will considerably alter the demand dynamics in the oil sector, potentially leading to a gradual decline in traditional fossil fuel consumption.
- Advancements in Solar and Wind Energy
Policies promoting green energy like solar and wind power are gaining traction, gradually steering clear from fossil fuels. The government's ambitious targets for renewable energy show a commitment to cutting carbon emissions and embracing sustainability. “Solar energy, especially, is growing faster; thanks to lower costs and better technology. Wind power projects, combined with new ways to store energy, are also making a big difference,” mentions ES Ranganathan. Ranganathan also predicts renewables will make a significant impact on our energy mix by 2024, reducing our reliance on traditional fuels. “India has a chance to set a record with 4 GW of rooftop solar power in 2024,” adds ES Ranganathan. But hitting this milestone depends on India sorting out regulatory issues and other challenges that persist. Studies suggest that by addressing these hurdles, India's rooftop solar market could see significant growth by 2024.
- Emergence of Green Hydrogen
The ongoing transition towards renewable energy sources marks a pivotal change in India's energy trajectory. “By 2024, the rise of green hydrogen, derived from renewable sources, is set to gain paramount importance as an energy conduit,” said ES Ranganathan. Foreseen as significant strides in electrolyzer technology, green hydrogen promises heightened efficiency and diminished costs in production. “Such breakthroughs bear immense significance, poised to amplify the practicality of green hydrogen in industrial processes and transportation, spanning various sectors,” added ES Ranganathan. This transformative shift signifies a pivotal moment in broadening the scope of renewable energy utilization and underscores the vast potential of green hydrogen in propelling the transition towards sustainable energy frameworks.
- Tapering Oil Prices in India
In 2024, projections suggest a notable tapering in the growth of oil demand in India. Forecasts indicate an expansion of approximately 150,000 barrels per day, a significant decline from the robust increase averaging around 290,000 barrels per day witnessed between 2021 and 2023. Reports reveal that this anticipated deceleration, emphasizing that it would bring the growth rate closer to the levels observed from 2011 to 2019. This moderation in oil demand growth within India, a pivotal market in Asia, signals a shift from the rapid surge experienced in recent years. Explaining the factors affecting this decline, ES Ranganathan shares, “This deceleration could include reasons such as evolving energy policies, advancements in renewable energy adoption, and potential changes in consumer behavior or industrial practices.” Furthermore, ES Ranganathan highlights the increasing role of electric vehicles (EVs) in India's energy landscape. He predicts a notable rise in EV adoption, propelled by government incentives, technological advancements, and a growing environmental consciousness among consumers. “As the market dynamics evolve, this anticipated slowdown in growth signifies a pivotal phase for India's energy landscape, possibly influencing global oil trends,” adds ES Ranganathan.
- Shift Towards Artificial Intelligence
In 2024, leveraging artificial intelligence (AI) in India's oil and energy sector will prove to be a transformative game-changer. By 2030, McKinsey & Company forecasts a groundbreaking potential for the oil and gas sector: a remarkable $1.2 trillion in savings achievable through extensive integration of AI throughout its operations. “This forecasted impact is substantial, largely owing to the industry's trailblazing stance as an early adopter of AI technology. Through the strategic implementation of AI, critical challenges within the sector can be effectively tackled, paving the way for a transformative phase marked by heightened efficiency, sustainability, and amplified competitiveness,” explains ES Ranganathan. AI-powered predictive analytics and machine learning algorithms will revolutionize operations, optimizing resource utilization, and enhancing efficiency across the sector. Advanced AI models are forecasting demand patterns with remarkable accuracy, which will allow for streamlined production schedules and inventory management. Additionally, AI-driven predictive maintenance minimizes downtime by identifying equipment issues before they escalate, thereby reducing maintenance costs and enhancing safety measures.
Moreover, AI is facilitating significant strides in exploration and extraction processes. Cutting-edge algorithms are analyzing seismic data with unprecedented precision, pinpointing potential reserves, and optimizing drilling strategies. This not only enhances the discovery of new oil fields but also reduces exploration costs. “AI's integration in India's oil and energy sector in 2024 is not just a technological upgrade but a strategic shift that promises increased productivity, cost-efficiency, and sustainability, positioning the country at the forefront of energy innovation,” concludes ES Ranganathan.
Addressing Challenges and Ensuring Sectoral Growth
Challenges such as energy security, sustainability, and market volatility remain focal points for India's energy sector. Strategies aimed at mitigating these challenges are pivotal for sustained growth. To enhance energy security, there is a concerted effort to diversify energy sources and reduce reliance on imports. Additionally, advancements in energy storage technologies are being pursued to counter intermittency issues associated with renewable sources. Sustainability initiatives, including energy-efficient practices and circular economy models, are gaining traction. Furthermore, market volatility is being addressed through innovative pricing mechanisms, hedging strategies, and investments in resilient infrastructure. As the nation marches towards its renewable energy targets, the sector's resilience and adaptability will play a pivotal role in shaping a more sustainable and secure energy future for India.
Disclaimer: This is a sponsored article and does not involve any editorial input. The views expressed, including any statements, views, opinions, announcements, declarations, or affirmations are neither supported, nor endorsed by The Telegraph Online.
