Importance of energy:

1. Energy is basic input required to sustain economic growth and to provide basic amenities of life for a country.
2. Energy is the difference between a subsistence economy and a highly developed economy.

India is the fifth largest producer of electricity in the world, behind USA, China and Russia. Energy in India is produced from commercial and non-commercial sources. The bulk of the commercial energy is consumed in the industrial sector followed by the transport and household sectors whereas a large part of the energy requirement in the rural and domestic sectors is met from noncommercial sources Of the two sets of sources, thermal power accounts for about 81%, hydro power for about 13 percent, and nuclear for about 3%. In next ten years, energy requirements of the economy would multiply by two to six times depending upon the rate of growth of the economy. Even if India achieves only an annual average rate of growth of 5%, the per capita consumption of energy would multiply by about 2.5 times. It, therefore, becomes crucial to identify the sources.