Prashant Ruia, CEO of Essar Group, said that even though there is an inevitable shift towards cleaner fuels, fossil fuel is likely to dominate India’s energy basket for many years to come. He said that India’s big bet is solar energy, which currently might have a storage problem but is expected to have a solution to that soon too.
Speaking exclusively to Business Today TV at the World Economic Forum in Davos, Ruia said, “Fossil fuel will still play a major role in our energy basket for many years to come.”
He said India can see big benefits with solar power. “The cost of delivering solar power in India is very low, cheaper than gas, cheaper than coal. We still have to solve the storage problem. Battery technology is coming and in a few years we will be able to address the storage problem. There will be an inevitable shift towards electric,” he said.
“Because India can do solar, and if we can replace our fuel and gas with low-cost solar, then I think it is a revolution. For the first time in the history of India, we can generate our own energy without importing. It is possible with solar in India, like what happened with the US and shale oil and gas. We are getting there,” he said.
Ruia also spoke of US President Donald Trump’s new executive order on energy. He called it a welcome move, and said that a lot of people lost sight of the fact that the transition to cleaner energy is not as fast as one believes it to be. He said, “For someone from the oil and gas business, drill where we drill sounds pretty good as a concept.”
“I think for too long fossil fuel, oil and gas, people have had this impression that you can transition into green fuels much faster than what’s actually happening on the ground. There is a lot of focus on electric vehicles and things like that but I would still say in the long runway to go before the transition takes place. People in the last 10 years sort of lost sight of that and said no to any sort of investments in the oil and gas business and similar businesses. I think that’s a welcome correction,” he said.
Trump had signed an executive order repealing Biden’s efforts to block oil drilling in the Arctic along with large areas of the US coasts. He repealed a 2023 memo that barred oil drilling in 16 million acres in the arctic.
Ruia said that he does not think the US is going to have a major turning of the cycle when it comes to the policies they are going to adopt.
“I don’t think they are going to turn the cycle. I mean they are one of the world’s largest oil and gas producers after the shale oil revolution took place. And if you really think about the growth and competitiveness of America, it really happened after they found shale gas and oil. They grew from 4-5 million barrels a day to now 10-11 million barrels a day at a very low cost. Their energy costs are very low. It still is one of the cheapest places in the world to buy gas and that really boosted their competitiveness and ability to manufacture locally. It is going to be more of that,” he said.