India targets 2070 for net-zero emissions:

Challenges and implications

Interview

Dissolving fears that US-China tensions could stand in the way of a substantive global strategy on climate change, the world's two largest emitters of greenhouse gases have pledged to work together on "enhanced climate actions that raise ambition" in the critical decade of the 2020s and “begin to move down a better road”. On 10th November, the United States and China released a rare joint declaration on climate change, with the Chinese climate envoy saying "there is more agreement between China and the US than divergence" at the Conference of Parties (COP26), the United Nations Climate Change summit. Earlier, at the beginning of the summit, India announced its commitment to a NetZero goal by the year 2070 and to increasing its non-fossil fuel energy to 500 GW in its energy mix by 2030. In his speech, Prime Minister Shri Narendra Modi termed the commitment as 'Panchamrut Ki Saugat' (gift of five elixirs). He enumerated the five elixirs as:

1.      India will increase its non-fossil capacity to 500 gig watt by 2030.

2.       India will meet 50% of its energy needs from renewable sources.

3.       India will reduce at least one billion tonnes of total projected carbon emissions between now and 2030.

4.       India will reduce the economy’s carbon intensity to less than 45% by 2030.

5.       India will become carbon neutral and achieve a net-zero emissions target by 2070.

Environment, Forest and Climate Change, Shri Bhupendra Yadav delivered the statement on behalf of the BASIC group of countries, comprising Brazil, South Africa, India and China at the COP26 at Glasgow. He affirmed that full effect must be given to implementation of the principles of Equity and Common but Differentiated Responsibilities and Respective Capabilities (CBDR-RC) and that COP 26 must aim for higher global ambition on climate finance and adaptation as well, along with recognition of Parties' differing historical responsibilities and the developmental challenges faced by developing countries, compounded by the COVID-19 pandemic.

 Before the 26th Conference of Parties (COP26), the United Nations Climate Change summit, there were debates on whether countries like India and China would commit to net-zero emissions. India's earlier target was to reduce the emissions intensity of its GDP by 33-35 per cent by 2030, compared to 2005 levels with already 24 per cent achieved by 2016. While the west has always painted India as the third-largest emitter after China and the US, India has maintained its per capita emissions are nowhere near the highest emitters

While India is receiving praises from different quarters for setting this bold climate change mitigation ambition, there are some pertinent questions that have come to the fore. Employment News spoke with two experts to get a grasp of the subject - Dr Vaibhav Chaturvedi, Fellow, CEEW (Council of Energy, Environment and Water), and Dr Anjal Prakash, Research Director, Bharti Institute of Public Policy, Indian School of Business

Q1: Is it possible for India to achieve the net zero-target by 2070? If yes then what kind of efforts are required?

Dr Vaibhav Chaturvedi: The 2070 NetZero announcement is a bold and ambitious target, but still achievable. NetZero is essentially about economic transformation, not just a climate agenda. For achieving this ambitious target, India needs to push some key reforms on its energy supply as well as demand side, including reforming the electricity pricing markets, distribution companies, as well as just transition.

Dr Anjal Prakash: In my view, India is already on the path of achieving net-zero. In February this year, India submitted the third biennial report to UNFCCC. The data reported there is promising. Between 2005 and 2016, India's emission intensity of gross domestic product (GDP) decreased by 24 per cent. As a result, the voluntary goal of reducing the emission intensity of GDP by 20-25 per cent from 2005 levels was met much earlier than the target year of 2020. So India is, on many fronts, already ahead in terms of not only targets but also in its policies and programs. PM Modi, by setting the target for 2070, may have bought time from the international community but I think India can achieve net-zero sooner than 2070.

Q2. Can you elaborate the implications of this commitment on industries and on the economy at large?

 Dr Vaibhav Chaturvedi: Four out of the five goals are for the 2030 horizon. These mainly focus on pushing renewable energy into the grid. So the near term opportunities lie clearly in the renewable space, with solar panel and wind turbine manufacturing and deployment. The fifth goal, the critically important one, is on the long-term net-zero target. This gives an important long-term signal for the economy and industries, to start planning in a strategic way for this long-term impending future, to understand the opportunities that could be harnessed in this transition. It is clear that the early movers and proactive businesses will be the ones that will gain from this transition. The short term (2030) and the long term (2070) goals are a package that give a great sense of certainty to the investors and businesses, who should act now to seize the opportunities in this long term transition process.

Dr Anjal Prakash: I think there would be more opportunities for industries to contribute if we take a path of green growth. It would mean having a balance between the three Ps - people, profit and planet. However, the industries have to look inward and change their strategies to align with the green growth model of development. This needs to be coupled with investing in the protection, sustenance, and improvement of human and environmental resources. This process is essential in aligning business objectives and strategies with the demands of the future. These steps gain added importance in vulnerable sectors such as travel, transport, automotive and tourism, which are more susceptible to climate change impacts than others. An in-house strategic analysis is needed for each industry to understand and manage its triple bottom line and act accordingly.

 Achieving net-zero will not be without any challenges. According to estimates given to UNFCCC, India would need approximately $206 billion between 2015 and 2030 for the implementation of its adaptation plans. PM Modi has pledged 1 trillion USD towards adaptation and mitigation. Most of these resources are presently met through domestic sources where people and businesses contribute through taxation.

Q3. Do you think developed world will readily provide one trillion dollar and the technologies to achieve climate goals?

 Dr Vaibhav Chaturvedi: I don't think so that the developed world will actually meet this target, which will be unfortunate.

 Dr Anjal Prakash: The global north looks for cheaper options such as market based mechanisms of carbon credit to show progress on net-zero but refrains from sharing technology. Most of the money which has been pledged in the name of adaptation finance is via loan and not grant in aid. India's per capita climate emission is one of the lowest in the world. India needs to develop and decarbonize but we shall do it at our own pace as there is a developmental need that India has to fulfill. It would be hard for India to pursue the path of net-zero without climate finance and so the accountability must be a two-way process. I feel that countries of the global south must come forward and form an alliance with India so that more such voices are coming together for climate finance.

Q4. Will job loss become a major concern? Will the renewable energy sector be able to provide jobs to those who may lose their livelihood due to the transformation?

 Dr Vaibhav Chaturvedi: In the near term, we should not be worried about job losses, these are not going to happen. There are more opportunities of job creation then there will be losses. In the long term, however, there will be job losses in the coal sector, but I don't expect this to happen before 25-30 years from now. Many of the current employed workers would retire by then. Hence a well thought out plan for supporting the rest who are in the final stages of their work life, and ensuring that their children are educated and trained to be gainfully employed in other professions is absolutely critical. Indian policy makers need to plan for the transition and ensure that no vulnerable family loses in this process. But I believe that with advance strategic planning, the job losses will be minimal and we would be able to create an economy of the future. Hence, planning is the key word here.

Dr Anjal Prakash: Climate change is bringing challenges, but it is also an opportunity for the economy to expand and diversify to newer areas which could prove profitable while also helping mitigate the impact of climate change. Some of the sectors where there could be investments are - renewable energy, agriculture, forest produce, sustainability linked financing, climate services, insurance etc. The other areas could be related to creating climate risk-related products, services and innovation in supply chain management which will entice consumers and shareholders. Climate risks are also opening new avenues and emerging markets that any forward-looking company can cash in on. There would be a shift in the nature of the job but I do not see a job loss in the near and longer future. It needs a different orientation and Indians are better at adapting to the new situation.

Q5. What new sectors will open up in the process of transitioning to greener fuels and what will be the job prospects in those sectors?

 Dr Vaibhav Chaturvedi: Hydrogen is going to be a big job creation sector along with the solar and wind value chain from manufacturing to deployment to operations. In addition, the electric vehicle space is going to be interesting from a job perspective. Finally, battery manufacturing is going to be booming for supporting both electric vehicles as well as grid integration of renewable energy. These in my view would be the sectors to watch out for in the next three decades.

Q6. Please elaborate India's pursuit in developing and importing technologies for green fuel.

 Dr Vaibhav Chaturvedi: Domestic manufacturing is critical for India's economy. Importing technologies is not the preferred option. Investment in R&D is hence critical. This is only possible if the private sector participates in the process. From this perspective, the announcement of large Indian business conglomerates' entry in the hydrogen production business, as well as solar panel manufacturing business is sort of a path breaking announcement. The role of India's private sector is going to be instrumental in the pursuit of domestic technology development.

Dr Anjal Prakash: It is more environmentally benign and that's why it is called green fuel. India has the capability to work further on developing biomass-based fuel. However, more research and development are needed. We also need collaboration with international players who may have better technology. In the climate negotiations, countries of the global south are asking for technology transfer and if that happens, biofuel or green fuel is one area that would be developed at a much faster rate.

(Interviewed by Rishikesh Kumar, Delhi-based journalist specializing in economic, defence, strategic and international affairs)

Views expressed are personal and do not represent the associated institutions