Newsletter - November 28, 2017
Smog unites? Pak CM reaches outAir pollution is set to rise, and in 2 days Delhi’s air quality may worsen by three times over safe standards. That’s the forecast weeks after the capital’s air became the worst in the world. Evidence suggests accurate forecasts are key to fighting smog, even as governments reach out or skirmish over schemes, including public transport.
‘Furnace oil, pet coke ban to stay’Meanwhile, the Supreme Court has rejected pleas from coal plants seeking permission to continue using the now banned furnace oil. The court said other states and union territories too must consider banning furnace oil and pet coke altogether, rather than merely ending pet coke import.
Coal plants to dodge emission norms for 5 more years?The Govt. has been blamed for not implementing emission norms for over 2 years. The ‘disgusting’ inaction has invited censure from top court that has set January 1, 2018 as the date for emission standards to become the law for industries. While the Centre has absolute powers to shut down or stop polluting industries anywhere in the country, it has instead, experts say, given tax advantage to the filthiest of fuels and plans to extend the emission deadline for coal plants by another 5 years.
5 most pollutedAs per the Central Pollution Control Board Air Quality Index, Delhi (346), Gurgaon (350), Lucknow (392) and Ghaziabad (390) and Moradabad (378) are among the most polluted cities in India.
India is confident it will exceed its renewable energy target of 175 GW by 2022 as it plans to award 100GW of solar and wind contracts by 2020 and surpass 200 GW by 2022. The government also aims to promote domestic solar manufacturing and help increase wind turbine export.
Consider the roadmap: 16GW of solar tenders by March 31 (2018), 30GW each in 2019, 2020 and nearly 10GW of floating solar capacity to be built on reservoirs. Solar equipment manufacturers to establish local units to supply domestic market. 4GW wind energy targets this year, 10GW each in 2019 and 2020, 5GW in off-shore projects and EXIM bank to help manufacturers boost wind turbine export. The government also plans to encourage farmers to generate 20GW of solar power.
20GW to spur domestic solar manufacturing
The power minister said the government plans to establish domestic manufacturing facilities for up to 20GW which will be set up through global bids. The government has not considered incentivising domestic manufacturers as the tender itself will create demand for solar equipment in the country. The ministry expects to resolve the issue of GST rates on solar panels in the next 7-10 days.
‘Duty on solar power panels illegal’
The power minister has complained to the finance minister that customs officials are wrongfully demanding 7.5% duty on imported solar equipment, which has led to ports getting jammed with shipments.
Tracking solar equipment IDs
India plans to penalize solar power firms that are using foreign equipment in projects awarded on the basis that they would only use locally made solar panels and cells. It will be mandatory for developers to disclose the radio-frequency identification (RFID) information of the panels and share the RFID list of rejected panels.
‘Diplomatic win’, China joins ISA
India scored a diplomatic ‘victory’ at Bonn when China announced its decision to join the International Solar Alliance (ISA) – which is initiated by India. Analysts say its China’s way to corner the solar energy market and a wake-up call for India which now needs to step up with affordable solutions.
‘Fair’, ‘unfair’ ratings
Indian industry has welcomed India’s sovereign rating upgrade by Moody’s, and is now expecting easier financing for India’s growing renewable energy projects. However, Standard & Poor’s kept its sovereign rating for India unchanged at ‘BBB-minus with stable outlook’, saying that vulnerabilities stemming from low per capita income and high government debt balanced strong GDP growth. The rating has been termed as “unfair” by the government.
Nagpur Metro to get solar power at less than Rs 4.50 a unit
Nagpur Metro has decided to go for captive solar power generation and will get it at Rs 4.50/kWh, while it will use more expensive (@Rs. 7.5/kWh) conventional power in the evening.
After Kerala, Goa to sail solar boats to work
Goa will introduce solar powered boats to revive river commutes. Residents can now get a calm, smoke-free cruise. India’s first solar ferry for public transport has been launched in Kerala by NavAlt, a Kochi-based company, earlier this year. The firm’s officials may visit Goa to study local conditions.
‘India will be EV battery leader’
A Niti Aayog study says India will be one of the world’s leading battery makers – with a $300 billion domestic market – if it sticks to its plan of shifting to 100% EVs by 2030. India’s EV shift will bring global battery prices down by 16% by 2030, an estimate that many current forecasts don’t take into account, the study said.
Electric mobility framework
The government think tank Niti Aayog is chalking out a framework to adopt EVs, and it has sought comments from ministries of heavy industry, environment, road, transport and highways and power for the purpose.
The panel recommends setting up of charging stations, manufacturing of lithium ion batteries in India and subsidising the cost of EVs. However, Transport minister Nitin Gadkari and Niti Aayog are not on the same page, and the minister has said it’s not Niti Aayog’s job to implement the EV mission and rejected its idea of swappable batteries – which are batteries which can be used by any electric vehicle and are available at petrol pumps or charging stations on rent.
Norms for charging stations
The government has approved a panel’s suggestion to have a uniform charging infrastructure that will enable EVs by different manufacturers to be charged at any station. Meanwhile, state-owned Indian Oil launched its first charging station in Nagpur – which is the transport minister’s constituency. Nagpur now has 20 charging stations, 200 electric taxis , and 1,000 more will be added by December. The minister is set to hold discussions with the Delhi CM to launch 1,000 e-buses.
Ride-hailing firm Uber and carmaker Mahindra and Mahindra will pilot EVs in Delhi and Hyderabad by March 2018. Mahindra & Mahindra is also planning to sell EVs in the US- possibly under the Italian design house label Pininfarina and/or the Korean utility vehicle label Ssangyong Motor Co. — following the opening of its office near Detroit. Maruti will release its first electric car in India in 2 years. Maruti’s parent Suzuki has also signed an EV-India pact with Toyota.
Musk wins battery bet
Tesla owner Elon Musk has won a US$50 million bet by beating a 100-day deadline for building the world’s largest battery to help South Australia avoid energy blackouts. Battery operation will commence on Dec. 1st.
Tesla’s Semi truck ‘threatens Bharat Forge profits’
Elon Musk’s electric truck Semi threatens to shake up the auto components industry, and may hit India’s Bharat Forge Ltd, which is a manufacturer of crankshafts. Electric trucks don’t require such parts, which means that over 20 % of Bharat Forge’s revenues could be at risk, Morgan Stanley said.
Tesla’s Semi, expected in 2019, could be the biggest challenge yet for the global road freight industry. It will have an estimated driving range of more than 800 kilometres. The truck can be charged within 30 minutes using a mega charger.
Bonn witnessed the launch of the Powering Past Coal Alliance, which aims to phase out global coal use by 2050, and the Talanoa Dialogue – a “transparent, inclusive and participatory” dialogue over climate finance, technical knowledge sharing on climate change impact mitigation and more aggressive pre-2020 reductions to national greenhouse gas emissions.
The next major climate event is the French President Emmanuel Macron’s One Planet Summit this December, with the objective of scaling up public and private finance for climate action. Also, in a snub to President Trump, California Governor Jerry Brown will be hosting the Global Climate Action Summit in September 2018 in San Francisco.
However, the key outcome expected from COP 24 will be the finalisation of the Paris Rulebook. As host nation, it will be Poland’s responsibility to ensure the rulebook is finalised and accepted by all, and it is reportedly already talking to Fiji (Chair at COP 23) and Morocco (Chair at COP 22) for cooperation. Experts think achieving the target will be tough, given the often acrimonious debates between the developed and developing nations on the mechanisms needed to tackle climate change.
Incidentally, Poland – under intense pressure from the EU – is now willing to ratify the Doha Amendment within 2017 and reduce its carbon emissions.
Two months after the national elections, there are no signs of a majority government in Germany. The situation has left a question mark on Germany’s role in global climate leadership. With coal accounting for nearly 25% of Germany’s primary energy use and 41% of its electricity, Chancellor Merkel also failed to announce (at COP 23) a date by which Germany would end using coal, even as UK and Canada have announced their deadlines (2025 and 2030, respectively).
The world is left guessing on what decisions Europe’s largest economy will take on the issues of climate, coal plants, and diesel vehicles, and how it will contribute to next year’s UN climate conference (COP24) in Poland, which will adopt the final Paris rulebook.
Leading Insurance experts have warned that 2017 was the most expensive on record following several climate disasters. Hurricane Harvey in Texas alone cost $180 billion, with just $19 billion of that loss insured the group said.
Swiss Re, the world’s second-largest reinsurer, said over the last decade only 30% climate disaster losses were insured, leaving governments, businesses and others to pick up the remaining $1.7 trillion tab.
The growing gap between the amount insured and actual losses is a threat not just to people, businesses and governments but even to the insurance industry itself.
Norway’s central bank has advised the government to divest from its shares in oil and gas firms – and thereby protect the country’s $1tn sovereign wealth fund (the world’s largest) – from a permanent drop in oil prices. Whether Norway’s government will accept the suggestion will only be known by mid-2018, but the potential divestment of nearly $35bn from oil majors such as Shell, Exxon, BP, Chevron and Total caused a sharp drop in their share values.
The news shock comes at a time when the industry is already battling a future drop in oil and gas demand from China, India and Europe, which are investing heavily into electric mobility and renewable energy for power generation.
Curiously though, Norway’s oil and gas unions and industry lobbies are open to Big Oil drilling in Norway’s Arctic shelf, as that would protect thousands of local jobs and the country’s enormous income through oil and gas taxes. Environmentalists on the other hand are suing the government, saying that the drilling will be a direct violation of Norway’s Paris Agreement commitments and its constitutional obligation to provide a safe and healthy environment to its citizens.
Fresh problems for TransCanada
Last week’s 200,000 gallon oil spill from the Keystone pipeline – that connects Canadian oil sands to US refineries – has come as another setback to oil major TransCanada. The spill is the pipeline’s third in less than 10 years and has cast fresh doubts over the proposed (and highly unpopular) Keystone XL pipeline, the rationale behind which looks already highly doubtful on the back of falling global demand for crude oil and a near doubling of the US’ domestic oil production.