Securing sustainable energy supplies to meet energy needs at reasonable/affordable prices has become a major energy policy imperative of Member States. The sky-rocketing oil prices and increasing energy demand have put severe strains on resources of all South Asian Countries. It has serious implications including slowing down of economic development, increasing inflation, deepening poverty and causing political and social instability in the region.
2. The South Asian region is energy deficient as it does not produce enough oil and gas to meet its needs thus depends heavily on imports. Most of the Member States are also not able to generate sufficient electricity to meet their demands. It has been estimated that energy needs of South Asia will increase three times in next fifteen to twenty years.
3. The process of regional cooperation in energy sector began in January 2000 with the establishment of a Technical Committee on Energy. The Technical Committee on Energy met twice. Thereafter, recognizing that this vital area requires focused attention, the Council of Ministers approved the creation of a specialized Working Group on Energy in January 2004.
4. The First Meeting of the SAARC Energy Ministers (Islamabad, 1 October 2005), decided formation of an Expert Group to deliberate on the options and potential of energy conservation and energy efficiency measures and to formulate a road map for implementation in the SAARC region. The Expert Group formulated a Road Map for implementation by the Member States:
5. The Thirteenth SAARC Summit, decided to establish the SAARC Energy Centre in Islamabad; to promote development of energy resources, including hydropower; and energy trade in the region; to develop renewable and alternative energy resources; and promote energy efficiency and conservation in the region. The Centre which was established in 2006 has become fully operational. For more information visit www.saarcenergy.org
6. As directed by the Thirteenth SAARC Summit, the government of India organized South Asia Energy Dialogue in 5th March 2007 which was attended by experts, academic think tanks and other stakeholders in the region. The Dialogue made a number of recommendations to promote cooperation in this vital area.
7. The concept of Energy Ring was developed by an Expert Group, which was approved by the Energy Ministers in their Third Meeting held in Colombo in January 2009.
8. The Working Group since its establishment in 2004, had held five Meetings so far, and made number of important recommendations to promote cooperation in the field of Energy among the Member States. It prepared a Plan of Action in its First Meeting held in Islamabad in June 2004 which is under implementation. The Fifth Meeting held in Bhutan in April 2009, decided to establish Experts Groups on ; a) Oil and Gas, b) Electricity, c) Renewable Energy and, d) Technology/knowledge sharing (including energy efficiency, coal etc.). These Experts Group will prepare ground work for energy cooperation in the specific Energy commodity.
9. A Task Force has finalized a common template on technical and commercial aspects of electricity grid interconnection amongst the SAARC Member States.
10. SAARC Energy Trade Study (SRETS) has been completed with the assistance of Asian Development Bank. It has identified four trade options which will be considered by the relevant SAARC mechanism in order to make a road map for implementation. As a follow SAARC has commissioned a study on Regional Power Exchange. The study is likely to be completed in 2012. The Study will explore the development of a regional power market involving SAARC countries that already have interconnection, as well as those that have planned interconnections. It will also examine both economic and technical requirements of establishing a regional power exchange that would maximise the potential for power transfers among SAARC regions to reduce power shortages and take advantage of economic benefits;
11. AS a follow up to the Summit Directive the Expert Group on Electricity in its Meeting held in January 2011 considered the (i) Concept Paper on theRoad Map for developing SAARC Market for Electricity (SAME)) and (ii) concept paper on SAARC Inter-Governmental Framework Agreement for Regional Energy Cooperation. Progress on these concepts will be reviewed by the Energy Ministers Meeting scheduled to be held in September 2011.