Blurred Climate Faultlines

The recent deal between the US and China on reduction of greenhouse gas (GHG) emissions marks an important step forward in the efforts to reduce global warming and avert climate change. The deal is notable for two main reasons. Firstly, it was negotiated bilaterally without the involvement of the multilateral United Nations Framework Convention on Climate Change (UNFCCC) process. Secondly, the US and China are the two biggest emitters of carbon gases and so their actions for reduction of emissions will have an impact on global GHG levels.

There is no denying the fact that the US-China climate deal has put the spotlight on India. The world’s two top emitters of greenhouse gases have set the tone for the climate change ministerial in Paris next year. China’s emissions will peak by 2030 under this arrangement, whereas US emissions will be down by 26 to 28 per cent by 2025 (over 2005 levels). India’s response that China’s development level cannot be compared with it has a ring of truth. However, India will remain under pressure to reduce its GHG emissions substantially at the cost of its ambitious developmental plans.

The implication is that India’s right to the global atmosphere cannot be curtailed at this stage. China’s per capita income at $7,000 in PPP terms is nearly five times India’s. Its poverty level is 5 to 6 per cent against India’s 21 per cent. Actually, almost all Chinese homes have access to electricity against 75 per cent in India. But India’s response reflects a sense of being caught off-guard; China was until the other day with India, speaking for the rights of the emerging economies to grow and develop. Now, with China having crossed over, it will become that much harder for India to press for the valid distinction between developed and emerging economies. The challenge before New Delhi is to insist on ‘common but differentiated responsibility’ between the OECD and the rest (the 1997 Kyoto protocol) in any new framework that may emerge in Paris, without, however, getting isolated in the process.

The fault lines have, however, blurred since the days of the Kyoto protocol. First, extreme weather occurrences have become frequent. Second, the share of the developing world in annual emission flows has increased. So, while the industrialised West is responsible for the stock of greenhouse gases, developing world emissions account for about 60 per cent of incremental emissions. India’s per capita emissions are way below that of China and the US, but it is the third largest emitter. Finally, rising emerging country emissions would have to fall for the total stock of GHGs to be frozen; cuts by the rich countries alone will not suffice. This calls for a nuanced re-positioning of the Kyoto principle.

A new approach is needed for a world running out of time. Carbon budgeting — assessing the right of respective countries to the atmosphere, taking both stock and flows into account — is a possibility. Instead of reacting to developments and proposals, India should be proactive. There is much India can do without hurting its developmental goals. It must review its reliance on coal to generate electricity and tap renewable energy – nuclear power, solar and wind energy – to reduce GHG emissions.

Lessons can be learnt from Germany’s rapid shift to renewables. The willingness to discuss the use of hydro fluorocarbons with the US, a cooling agent in air-conditioning that heats up the atmosphere, is a major step forward and can lead to technology transfer. The promotion of mass transport over personal vehicles and rail over road and air is an urgent need. We need a holistic approach to the issue of climate change.

India’s case is different from all others because, even though it is one of the major emitters, its per capita emissions are in any case very low. It has already stated that its average per capita emission would be capped below the world average. But it has been disinclined to set targets for quantitative reductions as its level of economic growth is much below those of developed countries and even China.

India will have to formulate a strategy that suits its needs and ensures the success of the UNFCCC process. We need a proactive and holistic approach to the issue of climate change.

What seem to have been overlooked in the above argument are the assumptions and financial implications of enhancing India’s ambitions in reducing emissions. Under the baseline model, a reduction of 22 per cent in emission intensity is possible by 2030 compared to 2007 levels whereas under the low-carbon model, a vastly higher reduction of 42 per cent would result.

There is, however, a caveat to this statement. The low carbon model would involve not only a substantially higher investment overall than the baseline script but would also need diverting about 50 per cent of the investment in sectors other than energy to renewable energy generation.

The figures of additional outlay of the order of $834 billion (at 2011 prices) required to be made in the energy sector under the low carbon model as compared to the baseline model accompanied by a cumulative GDP loss of $1344 billion up to 2030-31 are indeed staggering.

This effort would call for large-scale international assistance, which may not necessarily be forthcoming. Finally, any growth rate higher than 7 per cent per year, if necessitated by circumstances, would be unaffordable under a low-carbon strategy. However, India has to start working on its dependence more on renewable energy than coal.