Planning ‘just’ energy transition

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India’s 2030 targets and net-zero target are ambitious yet achievableIndia’s 2030 targets and net-zero target are ambitious yet achievable

Smoke Stacks Against Blue Sky

On the first day of the Glasgow climate conference – COP26 – the biggest announcement came from India. Ending speculations on whether India ‘will’ or ‘can’ make a net-zero pledge, Prime Minister Narendra Modi announced that the country will reach net-zero emissions by 2070. He also announced four major nearer-term targets exhibiting India’s will and ambition on climate action. The targets, all of which are to be met by 2030, include, an installed renewable energy capacity of 500 GW (up from 450 GW target); meeting 50 per cent of the electricity requirement through renewable sources; reducing total projected cumulative carbon emissions by one billion tonnes between 2020 and 2030; and reducing the carbon intensity of the GDP by 45 per cent from 2005 levels (up from the 33 per cent to 35 per cent target).

So how ambitious are these targets?

India’s renewable energy targets – 500 GW installation and 50 per cent of the electricity through renewables – mean that coal power will peak before 2030. In 2030, about 70 per cent of India’s electricity installations will be renewable and renewable energy, battery and smart grid will dominate the market. This would be one of the most rapid decarbonisation of electricity sector anywhere in the world.

India’s net zero target is equally ambitious, but few more details are required to judge its ambitiousness. There is confusion on whether India’s net zero target is for all greenhouse gases (GHGs) or it is only for carbon dioxide (CO2). If it is for all GHGs, than India’s target is compliant with 1.5 degree C warming. If it is only for CO2 than it is 2.0 degrees compliant. Even if it is only for CO2, it is still a strong signal to decarbonise the economy. As zero carbon become more accessible, India will update this target to attract massive global investments.   

In nutshell, these announcements have put India in a leadership role on climate mitigation action. The question now is, what are some of the major steps that must be taken domestically to steer the course of action in the coming years?

There are five ‘make or break’ factors for realising India’s ambitious targets.

First, if 500 GW of power generation capacity must be achieved, India must create an enabling environment for attracting global investments. India will need close to a trillion dollars in the next 10 years to meet this target.

Second, reforming the distribution companies (DISCOMs) is most important to create an enabling environment for decarbonising the grid. Most DISCOMs are failing to deliver quality services and are loss-making.  

Third, for meeting 50 per cent of electricity supply through renewables, India’s grid infrastructure will have to be strengthened, and battery storage capacity will have to be massively increased. This means that investing in smart grid and battery infrastructure is crucial.

Fourth, a large number of skilled manpower will be required to run the new electricity infrastructure. This means we must start investments in reskilling of existing and skilling of new manpower to meet the upcoming requirements.

Finally, all of these changes in the energy and industrial systems must be paralleled by a plan of just transition, to ensure that we do not carry forward the legacy of unequal development challenges of the coal era, into the new era of renewable energy and a greener economy.

In fact, while energy transition has been a hot topic on policy and business front, just transition has not got the due attention. However, as coal power will peak before 2030, it is time for India to start policy deliberations, develop plans for, and consider investing in it. And this is why it is crucial.

India’s energy geography will change because of massive investments in renewables. Today’s coal producing states will not be renewable superpowers. The renewable energy will be generated in western and southern states.  

Therefore, as the share of non-fossil fuel energy grows, the coal regions can spiral into a poverty trap, which many of the districts here are already saddled with. Also, there can be huge social instability triggered by job losses and uncertainty of income opportunities. As estimated 20 million plus workers will be impacted country-wide by the transition. In fact, the disproportionately high number of informal workers in our key economic sectors, such as coal mining, transportation, steel, cement etc., adds to the challenge. But all these can be avoided through a well planned and well managed just transition over the next decades.

Planning a ‘just’ energy transition will be a smart move by the government to further a development agenda that benefits all. We have the next 30 years to complete the transition, but the process must start now.

In the end, climate action will require global collaboration on finance, technology, and capacity. India will need global support in achieving these targets. This means that the developed countries must meet their part of the bargain by providing finance and technology support. As far as India is concerned, it has announced an ambitious target, it is now for the developed world to reciprocate.

 


Disclaimer:

This article was prepared with the support of the Heinrich Böll Stiftung. The views and analysis contained in the publication are those of the author and do not necessarily represent the views of the foundation. Heinrich Böll Stiftung will be excluded from any liability claims against copyright breaches, graphics, photographs/images, sound document and texts used in this publication. The author is solely responsible for the correctness, completeness and for the quality of information provided.