A shift to clean energy is welcome but Indian industry needs deep decarbonization over the next 30 years to make a difference
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We have seen two local events completely bring down global supply chains.
A ship in the Suez Canal blocked traffic for a week, delaying $9 billion of goods each day. And a pandemic originating in Wuhan led to the world economy contracting by 3.5% and 255 million jobs lost in 2020.
Such events reveal the fragility of the seemingly invulnerable and adaptable business sector. Bill Gates, in his new book, How to Avoid a Climate Disaster, estimates that the economic damage caused by climate change will be like that of a covid-scale pandemic every 10 years.
Indian industry has started preparing for the battle against climate change. Climate Trends’ recent survey of 400 large and small businesses in Maharashtra found that more than 70% believe climate change is affecting their profit, material supply, and expenditure.
Their main concerns are heavy rainfall, floods, water shortages, and droughts. Top Indian companies estimate the financial impact of climate risks at more than ₹7 trillion, with an average risk of ₹92 billion per company, according to a 2021 report by CDP India.
Several Indian companies have voluntary commitments on climate change, including targets for renewable energy, energy efficiency, electric mobility, greenhouse gas emission reduction, and internal carbon pricing to help achieve these targets.
In a new report, World Resources Institute India and Confederation of Indian Industry (CII) find that the existing climate commitments of just 50 leading Indian companies can reduce the country’s total greenhouse gas emissions by almost 2% below national projections for 2030.
More than 90% of this emission reduction comes from heavy industries, even though their current emission reduction targets are less ambitious on average. There is clearly potential to do more in these industries.
While Indian industry is starting to take bold action on renewable energy and electric mobility, all studies show that the war against climate change cannot be won without deep decarbonization of industry. This will require major shifts over the next 30 years and more. Here are three big things India’s corporate sector can do.
First, electrify as much as possible all energy use and switch as much as possible of the remaining fuel use to hydrogen. Today, industry burns coal, gas, petroleum and fuel oil to generate heat. But over the next few decades, at least half of this needs to be replaced by clean electricity and hydrogen.
Manufacturing hydrogen from electrolysis rather than fossil fuels is currently in the research and development stage. But concerted efforts like the Union government’s new national mission on green hydrogen can help reduce costs and create reliable supply infrastructure for this critical technology. This is the mitigation option with the biggest bang for the buck, potentially reducing a billion tonnes of carbon dioxide by 2050 compared to business as usual. For comparison, India’s current emissions are 2.8 billion tonnes.
Second, increase energy efficiency of industrial equipment. Even if we switch to renewable energy, wind and solar power need scarce land, making it important to squeeze efficiency out of available energy. While many leading Indian companies are among the most efficient in the world, others need to follow suit.
Micro, small and medium enterprises (MSMEs) that have the potential to become energy-efficient but lack the capital to upgrade need to be helped by large companies whose supply chains they constitute. Industrial energy efficiency improvement can save around 250 million tonnes of India’s emissions by 2050, and would come at very low cost.
Third, increase material efficiency, product longevity and re-use. Fossil fuels are used not only for energy but also as components of materials and in industrial processes. While we can use renewable energy to replace energy needs, there is nothing similar for materials.
However, we can reduce resource use through the circular-economy approach—use low energy and local materials, mix fly ash in cement, recycle scrap metals, re-purpose construction waste, and conserve water. This could help India reduce more than 300 million tonnes of carbon dioxide by 2050.
Finally, because not all process emissions can be eliminated, invest in carbon capture utilization and storage. As the world adopts stronger climate policies, proactive measures by Indian corporates can help them tap new markets and prepare for the economy of the future.
Even the finance industry can propel transformative action through its investments, spurring innovation in disruptive technologies and driving down their costs. In doing so, Indian industry also has the responsibility of looking after the well-being of its workers and the communities living near its sites—to equip them with new skills and help them adapt to climate risks. But the challenge is very clear: Without industry, the world cannot win its fight against climate change.
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- Lowering Emissions by Accelerating Forest Finance (LEAF) Coalition, a collective of the United States, United Kingdom and Norway governments, came up with a $1 billion fund.
- LEAF is supported by transnational corporations (TNCs) like Unilever plc, Amazon.com, Inc, Nestle, Airbnb, Inc as well as Emergent, a US-based non-profit.
- The world lost more than 10 million hectares of primary tropical forest cover last year, an area roughly the size of Switzerland.
- Ending tropical and subtropical forest loss by 2030 is a crucial part of meeting global climate, biodiversity and sustainable development goals. Protecting tropical forests offers one of the biggest opportunities for climate action in the coming decade.
- Tropical forests are massive carbon sinks and by investing in their protection, public and private players are likely to stock up on their carbon credits.
- The LEAF coalition initiative is a step towards concretising the aims and objectives of the Reducing Emissions from Deforestation and Forest Degradation (REDD+) mechanism.
- REDD+ was created by the United Nations Framework Convention on Climate Change (UNFCCC). It monetised the value of carbon locked up in the tropical forests of most developing countries, thereby propelling these countries to help mitigate climate change.
- It is a unique initiative as it seeks to help developing countries in battling the double-edged sword of development versus ecological commitment.
- The initiative comes at a crucial time. The tropics have lost close to 12.2 million hectares (mha) of tree cover last year according to global estimates released by Global Forest Watch.
- Of this, a loss of 4.2 mha occurred within humid tropical primary forests alone. It should come as no surprise that most of these lost forests were located in the developing countries of Latin America, Africa and South Asia.
- Brazil has fared dismally on the parameter of ‘annual primary forest loss’ among all countries. It has lost 1.7 mha of primary forests that are rich storehouse of carbon. India’s estimated loss in 2020 stands at 20.8 kilo hectares.
- Between 2002-2020, Brazil’s total area of humid primary forest reduced by 7.7 per cent while India’s reduced by 3.4 per cent.
- Although the loss in India is not as drastic as in Brazil, its position is nevertheless precarious. For India, this loss is equivalent to 951 metric tonnes worth carbon dioxide emissions released in the atmosphere.
- It is important to draw comparisons between Brazil and India as both countries have adopted a rather lackadaisical attitude towards deforestation-induced climate change. The Brazilian government hardly did anything to control the massive fires that gutted the Amazon rainforest in 2019.
- It is mostly around May that forest fires peak in India. However, this year India, witnessed massive forest fires in early March in states like Odisha, Uttarakhand, Madhya Pradesh and Mizoram among others.
- The European Union’s Copernicus Atmospheric Monitoring Service claimed that 0.2 metric tonnes of carbon was emitted in the Uttarakhand forest fires.
- Implementation of the LEAF Coalition plan will help pump in fresh rigour among developing countries like India, that are reluctant to recognise the contributions of their forest dwelling populations in mitigating climate change.
- With the deadline for proposal submission fast approaching, India needs to act swiftly on a revised strategy.
- Although India has pledged to carry out its REDD+ commitments, it is impossible to do so without seeking knowledge from its forest dwelling population.
Context:-
At the recently concluded Leaders’ Summit on Climate in April 2021, Lowering Emissions by Accelerating Forest Finance (LEAF) Coalition, a collective of the United States, United Kingdom and Norway governments, came up with a $1 billion fund plan that shall be offered to countries committed to arrest the decline of their tropical forests by 2030.
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Why LEAF Coalition?
Brazil & India
According to the UN-REDD programme, after the energy sector, deforestation accounts for massive carbon emissions — close to 11 per cent — in the atmosphere. Rapid urbanisation and commercialisation of forest produce are the main causes behind rampant deforestation across tropical forests.
Tribes, Forests and Government
Disregarding climate change as a valid excuse for the fires, Indian government officials were quick to lay the blame for deforestation on activities of forest dwellers and even labelled them “mischievous elements” and “unwanted elements”.
Policy makers around the world have emphasised the role of indigenous tribes and local communities in checking deforestation. These communities depend on forests for their survival as well as livelihood. Hence, they understand the need to protect forests. However, by posing legitimate environmental concerns as obstacles to real development, governments of developing countries swiftly avoid protection of forests and rights of forest dwellers.
For instance, the Government of India has not been forthcoming in recognising the socio-economic, civil, political or even cultural rights of forest dwellers. According to data from the Union Ministry of Tribal Affairs in December, 2020 over 55 per cent of this population has still not been granted either individual or community ownership of their lands.
To make matters worse, the government has undertaken systematic and sustained measures to render the landmark Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 ineffective in its implementation. The Act had sought to legitimise claims of forest dwellers on occupied forest land.
Various government decisions have seriously undermined the position of indigenous people within India. These include proposing amendments to the obsolete Indian Forest Act, 1927 that give forest officials the power to take away forest dwellers’ rights and to even use firearms with impunity.
There is also the Supreme Court’s order of February, 2019 directing state governments to evict illegal encroachers of forest land or millions of forest dwellers inhabiting forests since generations as a measure to conserve wildlife. Finally, there is the lack of data on novel coronavirus disease (COVID-19) deaths among the forest dwelling population;
Tardy administration, insufficient supervision, apathetic attitude and a lack of political intent defeat the cause of forest dwelling populations in India, thereby directly affecting efforts at arresting deforestation.
Way Forward
Tuntiak Katan, a global indigenous leader from Ecuador and general coordinator of the Global Alliance of Territorial Communities, aptly indicated the next steps at the Climate Summit:
“The first step is recognition of land rights. The second step is the recognition of the contributions of local communities and indigenous communities, meaning the contributions of indigenous peoples.We also need recognition of traditional knowledge practices in order to fight climate change”
Perhaps India can begin by taking the first step.