India Accelerates Green Fuels and Unconventional Exploration to Meet Soaring Energy Demand by 2035
SDG 7: Affordable and Clean Energy | SDG 9: Industry, Innovation, and Infrastructure
Ministry of Petroleum and Natural Gas
The Ministry of Petroleum and Natural Gas provided a detailed response in the Lok Sabha outlining the government’s strategy to meet the massive projected rise in demand for hydrocarbons by 2035, as forecasted by the International Energy Agency (IEA).
IEA Demand Projections (by 2035):
Crude Oil Demand: Expected to rise by 37%.
Natural Gas Demand: Expected to rise by 85%.
Strategic Steps to Enhance Domestic Supply and Diversification:
Unconventional Hydrocarbons: The government promotes the exploration and development of all unconventional resources, including Coal Bed Methane (CBM), Shale Oil/Gas, and Gas Hydrates.
Exploration Activity: ONGC has drilled 30 wells and Oil India Limited (OIL) has drilled 4 wells to generate critical data on Shale Gas potential.
Incentives: Fiscal incentives are provided for operators for future discoveries of these unconventional fuels.
Green Fuel Diversification: The government is aggressively diversifying energy sources to fuels like Ethanol, Compressed Biogas (CBG), and Hydrogen through schemes like the Sustainable Alternative Towards Affordable Transportation (SATAT) and the Ethanol Blending Program (EBP).
Ethanol Blending Success: The Ethanol Blending Program (EBP) has successfully increased ethanol blending in petrol from 1.5% in ESY 2014-15 to nearly 19.97% in ESY 2024-25. This initiative has resulted in crude oil substitution of about 260 lakh metric tonnes.
EBP is a critical government scheme aimed at blending ethanol (a biofuel derived from agricultural sources like sugarcane and grains) with petrol. The EBP strengthens India’s energy security by substituting crude oil imports, supports the agricultural sector, and reduces the country’s overall carbon footprint.
Policy Relevance
The Ministry’s response confirms a critical dual-track energy strategy: aggressively maximizing domestic hydrocarbon supply while accelerating the use of alternative and green fuels. The success of the EBP in substituting 260 lakh metric tonnes of crude oil imports is key to energy security and reducing the trade deficit. Future policy must prioritize securing the necessary transport and storage infrastructure to handle the massive projected demand increase and the expansion of new fuels like CBG and Hydrogen, ensuring the transition is safe and efficient.
Relevant Question for Policy Stakeholders: What specific investment and regulatory mechanisms is the government developing to ensure the transport and storage infrastructure is prepared for the major rise in demand for natural gas and the accelerated rollout of emerging fuels like Hydrogen and CBG?
Follow the full news here: LOK SABHA STARRED QUESTION NO. 74