Between 1992 and 2002, energy consumption in South Asia went up by 64%, accounting for 4.1% of world energy consumption (up from 2.8% in 1991). This unprecedented growth occurred mainly in the modern/commercial energy sector, and is attributed to economic and population growth. This paper describes how ensuring energy security to the millions of people will be a major challenge for South Asian nations. The challenge is not only due tothe limited reserves of natural resources within the jurisdiction of countries, but also to the fact that a large number of people are without access to reliable sources of energy. It is clear that the countries will increasingly adopt import policies that necessitate intra-regionalcooperation. However, the geopolitical reality also implies that the conventional boundaries in South Asia will become more flexible. The countries will also use various ‘supply-side’ strategies — as against the demand-side approach that has characterized the energy policies so far — to meet the increased needs. However, with regard to governing the energy supply, this paper argues that the nations would also need to explore alternatives beyond the state and market options and encourage and support innovative community initiatives that provide crucial energy support to a large number of rural people.