A way out of the oil crisis
The oil price spiral arising from the ongoing events in the Middle East will have a severe effect on India. The international price of crude oil is about to cross $120 per barrel from the $80 per barrel a few months ago. The consequences for India will be spread across several sectors of our economy and adversely affect the lives of millions of people. Some of these are obvious. The imported price of crude will cast a heavy burden on our foreign exchange resources and the domestic cost of energy will go up, thus affecting agricultural and transport sectors. Government subsidies to the oil companies and the inflation rate will also shoot up.
Obviously, the most important step we can take is to reduce petroleum consumption . If consumption is reduced in this sector, transport costs in other sectors like food, consumer goods, etc will benefit. So, we have to aim at reducing oil usage in this sector. In this regard, the government needs to take a few important steps. The largest consumer of petroleum products, that is diesel and petrol, is the transport sector.
A gadget called the hydrodrive electronic catalytic convertor has been in the market for the last few years. It has won the Best Asian Gold Award in 2001. It has obtained patents in India, the UK Canada and the Philippines . The Indian invention has been recognised and reported in scientific papers in Temple University, MIT of the US. The Tamil Nadu Pollution Board had submitted an eight-page report to the Central Pollution Control Board after testing the gadget on state-run buses. The average saving in consumption of petrol and diesel transport vehicles by the direct use of hydrodrive is about 10%.
The present method of testing and certifying the mileage of motor vehicles is misleading . The tests are done with test fuel of about 100 octane number, which is not available anywhere in India. The commercial fuel at the outlets has only about 85 octane number. Moreover, the test drive is done at a steady speed on smooth level roads with no traffic lights or stoppage. So, when the so-called kilometre per litre (KMPL) is shown as 23, the actual will be around 11 or 12. The further research on the gadget has brought even more satisfying results. Using the hydrodrive device can result in 25% saving in fuel in industrial boilers and diesel generating sets. This device is actually being operated in a factory in Tamil Nadu. This has been visited by reputed scientists, including former President Abdul Kalam.
This process is not just mixing oil and water. Hydrodrive emulsifies the oil-water mixture by the patented nanotechnology process and alters the composition of the fuel before combustion . In the case of transport vehicles, the emulsification can be brought about on board by fitting the modified version of hydrodrive. The practical ways of implementing the proposal can be devised by the government by taking a few decisions in the national interest.
One, vehicle manufacturers can be given a 10% reduction in excise duty if they install hydrodrive in their new vehicles. By equipping this device, they can save on the cost of installing exhaust catalytic converters that cost four times and have a limited life, unlike hydrodrive that can last for ten years. The hydrodrive gadget has been proved to be capable of reducing pollution by 70%.Lesser urban pollution from transport vehicles can save a lot of expenditure on healthcare.
Two,for existing vehicles,retrofitting can be undertaken in dealer and company outlets and oil companies can give petrol and diesel coupons for half the cost of retrofitting and claim the benefit from the government,which,in turn,will be saving on subsidies for oil companies.Retrofitting is a one-time expenditure.Three,for stationary applications in industrial boilers and diesel generators,up to 25% of the cost of retrofitting can be shared by the oil companies giving oil coupons as a one-time sharing of the cost of fitting the device.
Four,with the decrease in oil costs,there will be a reduction in the rate of inflation. Five,with oil imports likely to touch.40 lakh crore,even a 10% reduction on imports will save the country.4 lakh crore in foreign exchange. For a detailed examination of the proposals made in this article and for their implementation,a group of secretaries of the finance,petroleum,transport and environment ministries can be entrusted with the task to report to the government within a time-bound programme.
(The author is By G V Ramakrishna, former Union secretary, petroleum ministry)
(Courtesy: The Economic Times, New Delhi, March 07, 2011)
A way out of the oil crisis
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