Despite having relatively low per capita emissions (1.8 tonnes of CO2e per person), India remains the world’s third-largest single emitter. India has pledged to achieve net zero emissions by 2070. This goal can only be met through immediate action this decade, which could be accelerated by India’s recently assumed G20 presidency.
Current trajectory
- Emissions are set to grow: On its current trajectory, India’s emissions are set to grow from 2.9 GtCO2e a year to 11.8 GtCO2e in 2070.
- Decarbonization comes at a price: According to a recent McKinsey report, effective decarbonization to 1.9 GtCO2e by 2070 would necessitate India spending $7.2 trillion on green initiatives by 2050. This line of sight (LoS) scenario is based on policy announcements and anticipated technology adoption.
- Investment required: Deeper decarbonization requires $12 trillion in total green investments by 2050 to reduce emissions to just 0.4 GtCO2e by 2050, or close to net zero. Under this scenario, India could create 287 gigatonnes (GT) of carbon space for the world, accounting for nearly half of the global carbon budget, giving the world a fighting chance of keeping warming to 1.5 degrees Celsius.
What does India require to accelerate its decarbonization?
- A smooth transition will benefit, but the projects will require significant investment: For example, if India transitioned to a primarily renewable (and hydrogen) energy and materials system, it could save up to $3 trillion in foreign exchange by 2070. While the investment is substantial, the vast majority of abatement projects are profitable.
- Investment, regulation, and capacity building are all required: Three-quarters of India’s buildings, infrastructure, and industrial capacity in 2050 have yet to be constructed. We have the option of investing in current technologies or investing in the future. To make the right investments in the future, India will need to take urgent action in this decade on regulation, technology development, and technology adoption.
- Using renewable energy experience: In renewable energy, the right policies, strong institutions, and industrial capabilities built over the last decade have provided India with the foundation to scale up four to five times in this decade.
- Making electric vehicles competitive in the market: India has additional benefits. Its high taxation on automotive fuels, for example, translates to an imputed carbon tax of $140 to $240 per tonne of CO2. This makes electric vehicles competitive with gasoline or diesel vehicles, which explains the recent rapid growth of electric two-wheelers.
Ideas for an orderly transition in India
- Developing national and structural decarbonization strategies: Establish national decarbonization plans for the next five, ten, and twenty-five years. Carbon pricing or blending mandates can help make the economics viable. Such policies must be maintained and require coordination across sectors such as power, hydrogen, and steel. A national decarbonization strategy would allow for timely investment decisions.
- Developing a national land use strategy and considering the use of barren lands for renewables: India risks running out of land to meet its dual goals of growth and decarbonization. McKinsey estimates that renewable energy and forest carbon sinks require an additional 18 million hectares of land. India would need to maximize the use of barren land for renewable energy, vertically urbanize, improve agricultural productivity, and increase forest density.
- Accelerate compliance with carbon markets: Carbon pricing generates demand signals that accelerate emission reductions, particularly in difficult-to-abate sectors. To illustrate, consider steel, the demand for which is expected to increase eightfold by 2070; currently, much of the new capacity is likely to be added using high-emission coal. When carbon emissions are priced, more expensive green steel becomes competitive with high-emission steel. A carbon price of $50 per tonne, for example, could make green steel cost competitive by 2030, allowing the next 200 million tonnes of capacity to be created using low-emissions technologies.
- Investing in opportunities: Companies can aim to be on the cutting edge by investing in areas such as recycling, hydrogen, biomass, electrolyzers, rare earth, battery materials, and battery manufacturing. Some of these opportunities will require time to develop. Meanwhile, companies could invest in opportunities created by other countries’ decarbonization, such as exporting green hydrogen derivatives such as ammonia.
@the end
India requires imagination, realism, determination, and a sense of urgency to embark on an orderly path to net zero. An orderly transition to net zero could help India decarbonize while also creating a growth engine. We must take steps this decade to set things in motion, establish momentum, and build India properly for future generations.
Source: https://indianexpress.com/article/opinion/columns/india-transition-to-net-zero-8364223/