Task Force on Infrastructure
Draft Discussion Paper on Integrated Transport Policy

Energy, Environment and Transport


6.1 In the Transport Sector, energy planning has a special significance, not only because transport is the second largest consumer of energy but also because different modes of transport use different forms of energy with varying efficiency and intensity. Transport sector consumes 40% of energy and substantial portion of diesel supplies. The growth of transport not only leads to pressure on limited availability of non-renewable energy but raises broader environmental issues. Form of energy consumption, operational pollution, land intrusion and congestion are some of the areas of conflict between transport and environment. It is, therefore, necessary that environmental concerns should be built into project planning right from the beginning – at the stage of site selection, alignment finalisation, etc.

6.2 Considering that (a) rail and road are the major modes of transport and (b) given the higher rate of utilisation of capacity rail is more energy efficient, less polluting and more economical mode of transport, particularly, in movement of freight traffic over long hauls, it may be desirable to raise the share of railways in the total traffic. This may not be easy considering the capacity constraint faced by railways and the availability of more flexible and customer oriented road transport services. Railways, at present, carry 65% of long distance bulk traffic for which it is the most suitable mode of transport. By increasing its share to 80-85% in this type of traffic and by taking accelerated programme of containerisation, the Railways may attempt to increase its share in total traffic from the present level of 40% to 50%. by 2010, leading to a savings in diesel, which at the present level of traffic would amount to around Rs. 2500 crore of foreign exchange per annum. In addition to improvement in quality of their services, this would also necessitate strengthening of customised service.

6.3 Transport reform and development have widespread ramifications in other related sectors. Energy pricing is one such area. A fuel pricing policy in line with social costs, specially for diesel, would be necessary to rectify the modal imbalance. The abnormally high tariff on power used by the Railways has put an extra burden to the extent of about Rs. 969 crore during 1997-98. In the long term energy and environmental policy interest, tariff for electric traction is required to be rationalised in order to ensure that Railways retain their comparative advantage of energy efficiency.

6.4 In road transport, the introduction of new technologies and upgradation of highways to which a reference has already been made alongwith strict enforcement of regulation relating to pollution control will go a long way in reducing fuel consumption and pollution.

6.5 The transport sector is not only a major user of energy but provides a major part of its capacity for movement of various forms of energy. Coal and POL put together constitute around 55% of total rail traffic while POL traffic is 41% of total traffic handled at major ports. The movement of coal by railways is mainly for power generation. It is, therefore, necessary to optimise power generation from coal on the one hand and use of energy in transport on the other. Pithead generation of power would reduce the transport load of energy sector. The location of power plants near the coast would also relieve pressure on railways and promote movement of coal through coastal shipping. Pipeline which involves one time investment is the most economical mode for movement of liquid fuel and is next only to Railways in so far as energy efficiency is concerned. However, while creating pipeline network, the facilities and investment already provided by railways should be taken into account.

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