India comes to the table at COP26 in pole position.
While continuing to be upfront in making its case as well as that of the developing world, leaders representing India at COP26, which begins today in Glasgow, UK, have a cumbersome task ahead. This, despite India being in pole position primarily because of the boldness and realism it demonstrated at COP21. In November 2015, Prime Minister Narendra Modi had made a strong impression in Paris by announcing the 2022 goal of creating 175 GW of installed capacity of renewables-based electricity, with its share of non-fossil fuel-based capacity for electricity generation reaching a 40% share and its emission intensity of GDP reducing by 33-35%. The 197 participating countries had universally lauded India’s ambitions and responded appreciatively by unanimously approving the Indo-French proposal of setting up the multilateral International Solar Alliance (ISA) with headquarters in New Delhi.
At COP26, Prime Minister Modi might announce the raising of renewables capacity in India to 450 GW by 2030. However, since this aspiration has been known internationally, the participants particularly from industrialised nations, will be eager to hear about the response from India on their new proposal to reach carbon-neutrality or a net zero emission status by 2050. With India being the third largest emitter of GHGs after the US and China, and it be a cause of much concern for most developing nations, the issue would remain a major bone of contention at the fortnight long summit.
Prima facie, this proposal goes against the already accepted COP stance of “Common but Differentiated Responsibility” (CBDR). If cornered, it is reasonable to expect from the less affluent nations to demand of the proposer nations to indicate in concrete terms and with timelines, the details of their journey to that goal. Their past track record as well the conduct, post the Paris Agreement, reflects their less than genuine commitment to the cause. Only the recent climate -emergencies have galvanised them somewhat into thinking of initiating meaningful actions. Such a lackadaisical approach necessitates that they convince their poor brethren round the world they now mean business and are prepared to go to the requisite levels to make a worthwhile impact. By way of demonstration of their seriousness they should suo motto advance for themselves the terminal year of 2050 to 2040 or even earlier. Alongside they should agree to the developing nations to exhaustively consider the implications of the new proposals for themselves and to indicate their positions on carbon neutrality by 2023 when most nations’ NDCs come up for revision. During the intervening period, the developed world, which has the historical responsibility for the adverse climate change should facilitate the developing nations’ transition to renewables through extending the requisite financial assistance and the seamless transfer of climate technologies.
THE DIFFICULT NEW OBJECTIVE OF CARBON-NEUTRALITY
Aware of the expected strong opposition by 100-odd of the 197 participating countries—including the new grouping of 24 Like Minded Developing Countries (LMDCs) and the 27 Island Nations—developed nations have been applying high level diplomatic pressure in the run-up to COP26. In addition to updating their NDCs to reach carbon neutrality by 2050, they have got the subject listed for early discussion. The developing nations deem the industrialised nations’ past assurances of financial and technological aid to be hollow and bereft of legal obligation to assist those primarily not responsible for the emerging climate crises. They are backed by the recent reports from IPCC and other credible international researchers that on a net basis affluent countries continue to pollute far in excess of their fair share, and consequently have left disproportionately low carbon space for other countries. By accepting carbon neutrality by 2050, countries that are heavily dependent on fossil fuels such as India and many poorer ones, will be required to effect deep and significant cuts on their carbon and GHG emissions—a situation which will undoubtedly affect their development-trajectory.
Though both countries have in the past taken similar stand given their high reliance on coal, this time India and China may find themselves in different positions. Unlike India, China has expressed willingness to attain carbon-neutrality by 2060. China’s per capita income is now three-times India’s and it has progressed much further on all parameters of development. Given its system of governance, it can expeditiously effect deep structural changes, including levying personal impositions upon its citizens. China is on the cusp of moving to the category of a developed nation whereafter its development-process need not necessarily remain energy intensive.
India, on the other hand, lags behind. A recent study by the Indian think tank, Council for Energy Environment and Water (CEEW) estimates that to even achieve net zero by 2070, the usage of coal, especially for power generation, would need to peak in India by 2040, and then drop by 99% between 2040 and 2060. The consumption of crude oil would need to peak by 2050, and fall substantially by 90% between 2050 and 2070. For similar reasons, most LMDCs would prefer a gradual weaning away from fossil fuels. Additionally, they want the past polluters to put their money where their mouth is by paying for the environmental damage from rising temperatures and finance their transition to clean energy sources. Depending on which indirect impact and mitigation costs are included, the cost estimates of a transition by even 2070 for India range from $2 trillion to several trillion dollars.
Given these numbers, India has to be cognizant of the several costs involved in its shift to renewables. As of March 2021, of the aggregate generation capacity of 382 GW, coal fired stations account for 209 GW or 55%. These facilities contribute 71% of the generation during the previous fiscal. Renewables, primarily wind and power, with 24.7% capacity generated only 10.7% of our electricity, despite there being an escalation over past years. This caused the lower utilisation of thermal stations and their fixed costs had to be paid for first by the distribution utilities and then passed to consumers. The variable renewable energy has also imposed significant grid balancing costs. The Forum of Regulators estimates the average stranded costs of thermal stations to be Rs 1.02 and the renewable balancing cost as Rs. 1.11 viz a sum of Rs 2.13 per kwh, which the end electricity-user is required to pay. Given these cost implications it would be careful and only gradually ratchet up the renewable-power.
Along with being net zero emitters by 2050, another key expectation from developing countries in order to reach this landmark is their CO2 emissions peaking by 2029-30, whereafter the fossil fuel combustion for electricity would have to sharply decline. In practical terms, this means that apart from immediately ceasing to add any new coal or oil-fired stations, these countries would have to altogether replace all such facilities as emissions peak. For India, this translates to the 211 high emitting coal fired stations older than 25 years being shut down—these account for 36 GW of capacity or 46% of the power generated. Before this, the 47 public sector owned coal fired stations already in advanced stages of construction with 31.7 GW capacity must be fully operationalized well before 2029-30. Its nuclear power increased with the timely completion of 11 nuclear power plants of 8,700 MW. With such capacities materializing, and a greater utilisation of the more efficient low-emitting stations, the power industry’s CO2 emissions would decline by an impressive 57 mt annually in the next 8 years. But then all developing countries have not planned so elaborately. To meet the need of their growing population and developmental needs, most need to add to their generation capacities. These can be clean fuels based and the renewables only with sizeable assistance from the affluent nations.
COMMON FRONT BETWEEN DEVELOPING COUNTRIES FOR FINANCING AND FULFILLING NDCs
With industrialised countries including carbon neutrality by 2050 in their NDCs (with CO2 emissions peaking route by 2030 or earlier) and applying significant pressure there could be fissures in the united stand of developing countries. This may not be in form of open support to the rich countries but in softening of their own stands. In many ways this is inevitable considering each nation is unique with different endowments, economic requirements, and political priorities. Therefore, it is important that a common front is presented and a clear line in the sand drawn on what the richer nations must commit to. These ‘uncompromisables’ cover the assured $100 bn per year as climate finance starting this year with it doubling up every five years till 2050.. Also they must evolve a mechanism to legally ensure the flow of all technologies on climate adaptation and mitigation, with their IPRs (intellectual property rights) relaxed. Nations must also commit to not imposing any regulatory restraints upon their flows outside their boundaries.
The deadline for becoming carbon neutral should broadly be imposed along the per-capita income lines. Middle income countries might agree to reach the zero carbon milestone 10 years beyond 2050 (China and Saudi Arabia have already indicated their willingness to it). Low income nations, the least developed countries, and those that have an excessive dependence on a particular fossil fuel, could be a separate category that is allowed up to 20 years beyond the 2050 date. A similar distinction when it comes to the terms of financing could be sought from developed nations. Financial aid to the group of low income, LDCs and single fuel dependent countries should be on the highly concessional IDA terms (given by the World Bank to deserving borrowers) while others could be entitled to funding on the regular World Bank multilateral banking lending terms. This should help alleviate the recipients’ understandable doubts about being laden with debts on exorbitant terms to incur heavy expenditures on measures where benefits accrue beyond their national borders. India with its vast reliance on coal, would automatically fall in the low income grouping even though it is now on the cusp of being included in the middle-income category.
ADVANCING TIME-LINES FOR ALL IS NOT JUSTIFIABLE
A spate of well researched studies completed in the last 6 months, including ones by IPCC, WMO, UNEP and think tanks like the Euro-Mediterranean Center on Climate Change, the Climate Action Tracker and the German Climate Transparency, have all unequivocally confirmed that global GHG emissions, particularly by the G20 developed countries, have been rising since 2015. Consequently, restricting the average temperature rise to 2 degrees Celsius, let alone 1.5 degrees, by the end of the century is now unlikely. As per the present trajectory of emissions and the ameliorative measures under way, the world is likely to be hotter by at least 2.7 to 3 % degrees Celsius above pre-industrial levels. The mid-way goal of reducing GDP linked emission intensities by 45% by 2030 is also not likely to be met. Only a handful of countries (India and Russia being the exception) are expected to honour their 2030 commitments. The impact of such’ malfeasance’ on the planet would be catastrophic, unless remedial actions are immediately put into action by all concerned.
So far, the response of 120 nations has been to revise their NDCs, seemingly raising the contributions. A granular aggregation of the additional commitments though translates into a mere 10% reduction in emissions compared to the 45% needed to make a meaningful difference. The affluent nations might have included attaining carbon neutrality by 2050 in their own NDCs, but they remain wedded on getting developing countries to also join in. Such insistence could come in the way of progress at COP26. To ward off a possible deadlock, India might consider taking a more conciliatory approach in the latter part of the deliberations. Without moving away from its natural alliance with the fellow developing nations, it could move the deliberations of the second week to emphasise the emerging commonalities rather than the differences and build them into actionable measures. The emerging climate situation would be disastrous for the entire mankind. Intransigence must not be allowed to take over the deliberations and determine the outcome. For that, the developed world, particularly the better endowed G20 nations. must make the exercise at Glasgow more inclusive and based on equity, justice and fairness to all.
Dr Ajay Dua, a progressive economist and public policy specialist, is a former Union Secretary with a long association with the electrical power industry.