Modi's climate dilemma: net zero emissions versus growth

Modi's climate dilemma: net zero emissions versus growth

Prime Minister Narendra Modiin his third term with a weakened mandate, wants India to embrace a new “green era” at the forefront of climate diplomacy and clean technology.

To succeed, it will need to balance those ambitions with the need to sustain growth and meet rapidly accelerating demand for electricity, relying on a frayed energy system that still relies heavily on coal.

Modi, who has presented himself as a climate champion for much of the last decade, will be under pressure to move faster toward existing green goals, including promises to reach net zero by 2070, install a mammoth 500 gigawatts of non-fossil energy by the end of the decade, and bring together a global alliance on solar energy that aims to secure $1 trillion in investments.

But a significant expansion of clean energy (India added more than 100 GW of renewable capacity during the last 10 years of the Modi government) has not been enough to meet the strong growth in demand and the limitations of transmission and distribution networks. from the country.

With energy security a priority, coal still accounts for about three-quarters of current production and its use continues to increase. India plans to add nearly 90 GW of coal projects by 2032, about 63% more than the existing plan, published in May 2023.

New Delhi has expanded coal mining to a record level, extended the life of power plants and pushed for softening language around fossil fuels in international climate talks. state miner Coal India Ltd.which until the pandemic planned to diversify into solar energy, is now prioritizing spending record sums to expand fossil fuel production.

This is unlikely to improve under a new government.

According to Ashwini Swain, a member of the New Delhi-based research organization Sustainable Futures Collaborative, a more fragile and fragmented coalition could be driven to push forward projects that spread generosity and garner political support. “Protecting the fossil ecosystem may seem consistent with the goal,” she said.

Of course, India’s green ambition is real and the country, one of the most climate-vulnerable in the world, has been experiencing increasingly frequent cases of extreme heat and drought.

A pro-poor, pro-growth agenda need not rely on coal, which has proven to be more expensive and less reliable than cleaner alternatives, said Bengaluru-based independent energy analyst Alexander Hogeveen Rutter. “There is a real opportunity for the new government to radically rethink its strategy by doubling down on renewable energy and storage rather than investing in uneconomic and unreliable new coal plants,” he said.

But investment requirements are high, especially when it comes to infrastructure changes that will underpin a transition, from modernizing mobility in expanding cities to power grids. In 2022, Indian electricity planners estimated that to meet India’s renewable targets, the cost of laying new cables alone would be around 2.4 trillion rupees ($29 billion).

Renewable energy projects are still often built in arid areas, far from demand centers in cities and industrial hubs, where energy is consumed.

Meanwhile, the fragile financial health of distribution companies that connect homes or factories periodically deprives them of reliable supplies. A Rs 3 trillion project led by the Ministry of Energy will go some way to improving profitability, thanks to initiatives such as smart metering, but progress is slow.

One potential change over the next five years will be the role of local parties, which can facilitate centralization and put regional interests high on the agenda, climate analysts and researchers said, and that includes spreading the benefits of green manufacturing and clean energy.

“A coalition government should allow more states to make claims on India’s growing green economy,” said Rohit Chandra, assistant professor at IIT Delhi’s School of Public Policy. “The last decade saw most of this activity in four or five states, including Gujarat and Rajasthan.”

Those two states, which are also bastions of support for Modi’s party, enjoy the lowest cost of power generation, but poorer regions will now have a greater political role, which could attract investment to less prosperous areas.

“If we see more decentralization and more state-led growth, you could see some of these transition policies intertwined with basic economic aspirations, including health and education,” said Shayak Sengupta, climate and energy fellow at Climate in ObserverResearch. America Foundation.

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