Climate Change and India’s Energy Choices

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On 22nd November, Vivekananda International Foundation organized a Vimarsh on ‘Climate Change and India’s Energy Choices’ by Ambassador Dinkar Srivastava, IFS (Retd)- Former Ambassador of Iran, Czech Republic and Libya & Distinguished Fellow, VIF. Introductory remarks were given by Dr Arvind Gupta, Director VIF, in which he introduced the speaker and gave his brief point of view on COP26. Dr Gupta regarded the outcome of the conference as a disappointment and further explained that even though the Glasgow Climate Pact kept the goal of maintaining the global temperature to 1.5 degree Celsius alive, there was not much discussion about key issues such as climate justice and finance. In fact, there seemed to be little or no progress at all as far as global cooperation in the fight against climate change is concerned.

In the course of next one hour talk, the speaker touched upon many important points which can be characterized as follows:

• Historical Background- the principles of ‘historical responsibility’ and ‘common but differentiated responsibility’ which emerged from the Rio conference of 1992 seems to have been progressively diluted today. Next, it is during the Kyoto Protocol that the developed nations recognized the principle of ‘common but differentiated responsibilities’ (CBDR). Another milestone agreement in the history of international climate talks which is the Paris Agreement led to the dilution of the principle of CBDR. Additionally, it also led to an agreement amongst the nations to contain the global temperature below 2 degrees above pre-industrial levels and the subject of climate finance was also touched upon in which the developed nations promised to provide a finance of $100 billion to the developing nations by 2020. Historically, India bears no responsibility for global emissions or warming.
• Glasgow Conference- the summit mainstreamed the idea of limiting the temperature rise to 1.5 degrees Celsius. It has also endorsed the concept of net-zero emissions which mean that it breaks down a global problem to implementation at national levels. Another outcome of the conference which has caught the media attention the most is the issue of ‘phasing down’ of coal than ‘phasing out’ which leads to another subject of debate of ‘energy transitioning’.
• Energy transitioning- coal is not the only fossil fuel and fossil fuel remains a major part of the energy basket of the developed countries as well as electricity generation. Fossil fuels also constituted 67 percent of final energy consumption of the world in 2020. Besides, electricity is only 1/5th of the total energy consumption, points out to the difficulty inherent in energy transitioning. An IEA report’s prescription is that to attain net-zero commitment the world has to have 90 percent of electricity generation through renewables, balance 10 percent should come from nuclear. Hence, the share of electricity generation in the energy basket will have to move from one-fifth currently to one-half which further means that new sectors have to be brought under electrification like transport and industry. This is a huge task and a major problem. Fossil fuels remain a major part of energy consumption as well as electricity generation in all developed countries including China. This shows the bigotry of developed world in singling out coal. An energy transition of such a nature has never taken place before in such a compressed time. Coal age has lasted for more than two centuries and it is still continuing and oil age has lasted for more than a century. Hence, to expect that the world will make a transition to renewables in a short period of 40 to 50 years looks unrealistic and requires large amount of financial resources.
• India’s energy choices- India stresses on renewables and they have a major role to play in the country. For instance, solar plays a huge role in India. However, in the last two to three years, the investments in renewables have kept falling and in the case of wind, it has gone down very substantially. There has also been a remarkable slowdown of investments in solar. This brings India to the issue of finding resources for making the energy transition. The second constrain India faces is that it has about 21,000 or 25,000 crores of stranded gas assets. Third, is about the foreign capital flowing into renewable energy once the government takes a policy decision. However, if one looks at the past, the total FDI in the sector has just been $ 10 billion. This may look like a substantial figure but if one evaluates it over a twenty-year time-span, this is a very small amount. Fourth is that for making the energy transition, India will need enormous resources. It is a huge issue and $ 100 billion is very less and even if this money comes, India will be at the end of the queue as the major shares will go to the Least Developed Countries. Hence, India will have to find out money from its own resources. This requires India to make very careful energy choices. Since, renewables are intermittent; it is important to build stand-by capacity which remains ideal or has to be operated at sub-optimal capacity. India’s only solution is to increase the share of nuclear.

This was followed by a small intervention made by Dr Gupta who summarized some of the key points of the talk as follow:

• Energy transition is very difficult especially for India
• Renewable energy is not inexpensive

The session was then followed by a long question and answer session.