Global studies emphasizing the efficient use of the energy have also demonstrated the relationship between efficient energy consumption and economic growth. Emission of greenhouse gases (GHG) is proportional to energy utilization and is found higher in developing countries due to the inefficient use of energy (Al-mulali and Che 2012). 
Environmental pollution, health related issues, and other global problems have increased with increased fossil fuel extraction and consumption. Unplanned urbanization and industrialization have increased the energy demand. Burning of fossil fuels has led to the emission of greenhouse gases (GHG) such as carbon dioxide (CO2), oxides of sulfur (SOx), carbon monoxide (CO), water vapours, etc., apart from the release of particulate matter, solid and liquid waste to the environment. This emphasizes the need for exploiting renewable energy (RE) sources to mitigate pollution and address the problem due to dwindling stock of fossil fuels.

1.1. Indian Energy scenario:

India is the seventh largest geography and ranks fourth among high energy consuming countries in the world with over 1.27 billion population. Total primary energy consumption has increased manifolds during the past three decades from 18 MTOE (in 1980) to 104 MTOE (2011) in India (EIA 2013; TEDDY 2013).  Coal, natural gas, and crude oil are the leading commercial sources of energy of the country in which most of the crude oil are being imported. Even though the industrial and commercial sectors make use of fossil fuel resources, the Indian domestic sector largely depends on non-commercial energy sources such as fuel wood, agricultural and horticultural residues, animal residues, biogas, and combustible waste.  However, the commercial consumption of bioenergy has decreased with switch over to fossil energy sources (coal, crude oil, natural gas, etc.) over the years (Pachauri and Jiang 2008). Rural population constitutes 70 per cent in India and largely depends on bio resources for domestic energy.  About 75 per cent of the rural households depend on firewood, 10 per cent on dung cake, and 5 per cent on LPG for cooking whereas, 22 per cent of the urban households depend on firewood, 22 per cent on kerosene, and 44 per cent on LPG for cooking in the country. Some fraction of the urban households is also dependent on fuel wood for cooking, water heating, and space heating (NSSO 2007). Consumption of non-commercial energy sources in the country remained the same with minimal variations. However, the exploitation of fossil fuels has increased substantially to meet the growing demand of industrial, commercial, and transportation sectors with the favourable policies (Simron et. al. 2012). Realizing the growing concerns due to large-scale utilization of fossil fuels on the environment and also to reduce the high imports, India is promoting RE (Renewable Energy)-based energy harvesting programmes through JNNSM (Jawaharlal Nehru National Solar Mission), RGGVY (Rajiv Gandhi Gram Vidyut Yojana), etc., with a goal to have 20,000 MW of grid connected and 2000 MW standalone solar power by 2022. Energy conservation and rural electrification are made mandatory under the Energy Conservation Act, 2011, and Electricity Act, 2003, by the Government of India towards the goal of energy independence and to lower the energy demand (MNRE 2013a). Economic development with financial security of a region is dependent on energy independence and achieving the same is a daunting challenge. Exploitation of renewable sources with efficient use of energy and demand-side management would ensure sustainable growth in the energy sector while reducing environmental pollution (Bhattacharyya 2010). This will bridge the supply-demand gap through reduction in the energy loss from generation to end use.

Electricity has a wide range of applications as it is a clean and an efficient media of energy transport. Per capita electric energy consumption in India is about 879 kWh (2012) and the source of electricity generation plays a significant role in energy management and conservation. Electricity generation has been largely dependent on fossil fuels (coal) which are mostly centralized. Centralized generation and sparsely located loads are the prime reasons for un-electrified rural households with higher transmission and distribution (T & D) losses. Indian electrical power transmission and distribution network encounters higher losses (~24 per cent) compared to other countries (China-6 per cent, Australia-5 per cent, Bangladesh-10 per cent, Germany-4 per cent) and world average (~10 per cent) due to un-metered electricity supply, un-authorized expansion, theft and pilferage at the distribution side (CEA 2013). Transmission networks are being strengthened with the advanced (electronic) metering facility in many urban regions. In this context, innovations in power sector through distributed/decentralized generation (DG), micro-grid and smart grid would pave the way for efficient and effective power systems in India (ISGTF 2013; MoP 2013).
Implementation of DG results in direct economic benefits including reduction in operation and maintenance (O&M) costs, capital investment to upgrade the generation, fuel cost, and dependency on fossil fuels. Other indirect benefits include reduced investment for pollution prevention and health-related expenses, apart from achieving the national and local energy independence (El-Khattam, Hegazy and Salama 2005; Pathomthat and Ramakumar 2004). DG and micro-grid have the versatility of incorporation of next generation power technologies such as smart grid architecture, advanced metering infrastructure (AMI), biofuel generation using algae, electricity from solid waste, and energy plantation. Certainly the future energy resources have to renewable in nature, to meet the growing demand; distributed generation and micro-grid facilitates energy generation near load centers. Exploitation of RE sources and reduction of T & D losses certainly make the energy sector sustainable while achieving energy independence.

  1.2.Need for the Study:

India with fastest growing economy, the dependence of energy has increased manifold due to industrialization and the impetus given to infrastructure development. The trajectory of energy generation, transportation and consumption has to be understood in order to adopt the sustainable energy management strategies to avert any energy crisis (Ramachandra 2008; Ravindranath and Balachandra 2009). Effective DSM (Demand Side Management) techniques include budgeting non-commercial energy resources in the present energy scenario and end use efficiency improvements. The present study analyses developments in the energy sector in India from generation to end use. Energy conservation needs to be achieved through the improvements in the end-use devices to have a sustainable and pollution free growth. Technological interventions will give scope to utilize locally available non-conventional, renewable energy resources (Kumar, Christopher and Singh 2013). Substitution of fossil fuels through RE sources will also help in attaining energy independence in the region. However, this requires assessment of the resources and patterns of energy consumption from various resources (commercial and non-commercial), apart from techno-economic feasibility of alternate energy trajectory. 

Centralized options of generating electricity and supply to remote and sparsely located loads have often faced technical challenges apart from lack of economic viability. Electrification of rural India is yet to gain momentum as is evident from the absence of electricity supply to more than 74,00,000 households of 18,000 villages. The electrification of remote villages to meet the basic electricity demand is possible through standalone RE source based generation (Ramachandra and Shruthi, 2005; Ramachandra, Hegde and Krishnadas, 2014a; Nouni, Mullick and Kandpal, 2009). Potential assessment of RE sources through geographical information system (GIS) has helped in optimizing the availability (Ramachandra, Hegde and Krishnadas, 2014b) and integration of resources towards a reliable supply. Energy conservation and demand side management is the other aspect to flatten the load curve and to reduce the peak demand. DSM techniques and efficient methods in end use of energy will have a direct impact on generation. The present study analyses the prospects of RE sources, non-commercial energy sources, scope for the improvement of end use efficiencies, and options to ensure sustainable energy path, while reducing the supply-demand gap.  The main objectives of the current research are as follows:

1. Understanding the energy situation in India—sector- and source-wise energy demand with the scope for energy conservation through DSM and end use efficiency,
2. Prospects of renewable energy with DG and smart grids to meet the distributed energy demand while optimizing harvest of local energy sources.