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India Could Be The Torchbearer In The Global Transition To Clean Energy

09/06/2016 8:37 AM IST | Updated 15/07/2016 8:27 AM IST
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TO GO WITH: Climate-warming-COP21-India-energy-solar, FOCUS by Annie Banerji In this photograph taken on August 23, 2015, an Indian engineer walks past solar panels at the under construction Roha Dyechem solar plant at Bhadla some 225 kms north of Jodhpur in the western Indian state of Rajasthan. Under a blistering sun, workers install a sea of solar panels in a north Indian desert as part of the government's clean energy push --- and its trump card at upcoming climate change talks in Paris. AFP PHOTO / MONEY SHARMA (Photo credit should read MONEY SHARMA/AFP/Getty Images)

Energy ministers and delegates from more than 20 leading economies gathered at the 7th Clean Energy Ministerial (CEM) last week in San Francisco, to accelerate action on transitioning to the clean energy future envisioned at COP21. The historic Paris Agreement adopted by 195 countries at COP21 is an unprecedented opportunity to advance the political dialogue on international cooperation for a global clean energy transition. Can India with its exceptionally bold renewable energy (RE) targets spearhead this movement?

India -- A market leader in clean energy

Almost 77 million Indian households lacked access to electricity, according to the 2011 census, and rural areas registered only 66.9% electrification at the household level as compared to the national average of 75.3% and the global average of 81.9% (International Energy Agency, 2013). Other estimates corroborate that about 300 million Indians lack access to modern energy,* and note further that the poor quality of supply really means that an equal number effectively do not have consistent access.

The Indian government intends to transform the energy systems in India to provide clean, affordable and reliable power -- particularly by advancing renewable energy.

The Indian government intends to transform the energy systems in India to provide clean, affordable and reliable power -- particularly by advancing renewable energy. The government has committed to installing 175 gigawatts (GW) of renewable power capacity by 2022. By doing so, it quintupled the solar energy target to 100 GW with 40 GW of rooftop solar. It envisions turning owners of rooftop solar PV systems into micro-entrepreneurs who sell net excess generation to the grid, augmenting their income and reducing power bills, since they will only have to pay the "net" amount. The government is also tripling wind power generation capacity to 60 GW from the previous target.

India's Intended Nationally Determined Contribution (INDC) builds on this commitment, and aims to reduce emissions intensity of its GDP by 33 to 35% by 2030 from 2005 levels, and achieve about 40% cumulative electric power from non-fossil fuel based energy resources by 2030. India has stepped up the plate with its bold renewable energy goals, despite sluggish implementation rates, in addition to factors like land procurement, grid infrastructure and the financial viability of distribution companies.

G7 and Clean Energy Ministerial falling short?

At last week's G7 in Japan, in a meeting focused on the migration crisis in Europe and economic woes of the world, leaders vowed to make global growth their urgent priority through two statements. First, they recognized the need to adopt sustainable development goals through a reaffirmation of the CONNEX guiding principles for sustainable development. Second, they encouraged the need to implement the Paris Agreement through the Kitakyushu initiative on energy security and global growth. Essentially, the G7 leaders must now follow through to scale-up clean energy investment, starting with a targeted discussion at the upcoming G20 meeting to end perverse fossil fuel subsidies.

On the global stage, PM Modi announced the International Solar Energy Alliance at COP21, to promote cooperation between developing and developed countries in scaling solar deployment.

Meanwhile, the United States hosted ministers and high-level delegates from 20 countries, representing 90% of clean energy investments and 75% of the world's greenhouse gas emissions. The Clean Energy Ministerial (CEM) in San Francisco made announcements and released reports and state commitments aimed at advancing clean energy cooperation and the implementation of the Paris Agreement.

No doubt, the leaders will recognize the Green Climate Fund, an important vehicle for delivering finance, which was operationalised in 2014 after achieving only US$10 billion in (multi-year) pledges. There also will be enthusiasm about evolving experiments in carbon pricing and other mechanisms which may have the potential to increase investments into climate friendly programs. However, the net incremental infrastructure investment needs from a low-carbon transition up to 2030 could be in the trillions. ** It is time for the G7 leaders and CEM delegates to put all their efforts to seriously address the need for such large-scale financing requirements to ensure that the carbon budget for 2 degree C (preferably 1.5 degree C) are not exceeded. That may require hard-nosed approaches such as carbon taxes, or out-of-the-box innovations like the Tobin tax, to leverage a commensurate level of investments.

Intended to mobilize $1 trillion in investment, the [Solar Energy Alliance represents] a huge opportunity for Modi to make India a market leader in clean energy development.

India's chance for leadership

Prime Minister Modi understands the importance of building international partnerships to help India toward achieving this ambitious vision for renewable energy. On the global stage, PM Modi announced the International Solar Energy Alliance at COP21, to promote cooperation between developing and developed countries in scaling solar deployment. Intended to mobilize $1 trillion in investment, the alliance aims to drive down the costs of solar power, making it affordable for a growing number of communities. The ambition is laudable, as it is commensurate with the level of investments needed toward a clean energy system the world needs.

This is a huge opportunity for Modi to make India a market leader in clean energy development, and lead the way for global cooperation in scaling clean energy, while stepping up pressure on G7 and CEM delegates to meet climate goals.

* Energy consumption and energy intensity of GDP data are from World Bank, 2014a, updated using: International Energy Agency (IEA), 2014a, World Energy Statistics and Balances 2014; and British Petroleum (BP), 2014, Statistical Review of World Energy 2014. Data for energy access from: Sustainable Energy for All, 2013, Global Tracking Framework 2013.

** Climate Policy Initiative analysis for the New Climate Economy project, based on data from: IEA, 2012, Energy Technology Perspectives; OECD, 2012, Strategic Transport Infrastructure Needs to 2030; and OECD, 2006, Infrastructure to 2030. Ratio of GDP is estimated by calculating GDP for 2015-2030 per the global growth rate projected in: Organisation for Economic Co-operation and Development (OECD), 2012. Medium and Long-Term Scenarios for Global Growth and Imbalances. OECD Economic Outlook.

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