Amidst the turmoil of the Ukraine war, India is trying to find a way to access finance and tech from developed nations, and oil and gas from Russia and Iran
India gave its nod for the long-awaited update to the country’s Nationally Determined Contribution (NDCs) to be submitted to the UNFCCC. The Cabinet approval was announced through a press release, which included the highlights of the NDC update. While the full text is yet to be made public, the announcement has elicited attention as the first glimpse of India’s long-term net-zero strategy.
The update has also come at a juncture marked by geopolitical volatility. Russia’s “special military operation” in Ukraine and concerns about China’s ambitions in the Asia-Pacific region have reaffirmed old geopolitical alliances and spurred the formation of new ones. Sanctions on Russian energy have sent governments, particularly in Europe, scrambling to find alternate sources. Stuck between the need to decarbonise and the prospects of an impending energy crisis, dissonance has crept into energy policies and strategy of developed economies. Months ahead of COP27, the developed economies continue to push conflicting policies of boosting fossil fuel production and decarbonisation simultaneously to a dangerous template that justifies the former as short-term extraction (of oil and gas) and the latter as long-term investment. Such green deals, hand-cuffed to fossil fuels, were seen at the G7 summit and most recently at the US Senate’s $369 billion domestic fund approved for climate and energy.
Energy has always been a pivotal factor in geopolitics; more recently, decarbonisation has become an important bargaining chip. For countries like India, the diplomatic jostle includes a choice between access to finance and technology from developed countries for the low-carbon transition and reliable access to oil and gas from sanctioned oil producers like Russia and Iran. Read the subtext, and the update to India’s NDC, too, reflects this context and the balancing act contained within it.
India’s NDC: What we know so far
The press release announcing the cabinet approval for the NDC update is not heavy on details, but does include the three specific commitments to be submitted to the UNFCCC for climate action in the current decade. India will now reduce the emissions intensity of its GDP by 45% by 2030, relative to 2005 levels. The previous NDC set a target of 33% to 35% compared to 2005 levels. India also aims to achieve about 50% cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030. This was previously set at 40%. India is already close to achieving both original targets.
In addition to the two updates, the Cabinet has also formalised the government’s stance on “sustainable lifestyles and climate justice” through the inclusion of a mass movement under the aegis ‘LIFE’– ‘Lifestyle for Environment’. While the press release highlights the movement as capturing a “citizen-centric approach”, details of what exactly it would involve remain vague.
Interestingly, the press release steers clear of carbon sinks or removal targets. India’s original NDC included the commitment to create an additional carbon sink of 2.5 to 3 billion tonnes of CO2 equivalent through additional forest and tree cover by 2030. The net-zero announcement last year from Indian Prime Minister Narendra Modi also included a stated intent of reducing 1 billion tonnes of carbon by 2030. Neither of these found any mention in the press release, and the afforestation target remains the most difficult to achieve from the original set of three commitments. Also left out was the previously mentioned 500 GW non-fossil fuel energy capacity target. Analysts in the past have pointed out the difficulty of aligning the 500 GW number with the 50% non-fossil fuel power generation capacity target set for 2030. Adaptation, too, was left out entirely in the press release.
The release, however, was careful to explicitly mention that the NDC update would not include any binding targets for sector specific mitigation obligation or action. Also explicitly mentioned is the expectation of “its due share” from international climate finance commitments from developed countries.
Scarcely by coincidence, the terms of this finance have started cropping up increasingly in international security, energy and trade negotiations.
Just transaction: Developed economies eye emerging markets to ‘save’ them from Chinese debt
Before the Ukraine war, the G7 and the EU imported 33% of the total Russian coal exports in 2021. It also met 25% and 40% of its oil and natural gas demand through imports from Russia. Now, as energy security is threatened by war, the leaders of the bloc have pushed for diversification of energy sources by pushing for more oil and gas exploration overseas and temporarily lifting embargoes on coal. Even as the existing mechanism of Green Climate Fund is starved of funds, the G7 nations led by the US have floated their own climate fund to do business with the Global South directly to counter China’s belt and road initiative. India negotiated this “East and West” divide at the BRICS summit and later at the G7 summit as a special invitee.
The advanced economy group proposed a $600 billion infrastructure plan to counter China’s Belt and Road initiative in Africa, Latin America and Asia. To tap the emerging markets, the group proposed financing clean energy through the Just Energy Transition Partnerships (JET-P) with India, Indonesia, Senegal, and Vietnam, on the lines of partnership it initiated with South Africa at COP26.
In November last year, the UK, France, Germany, and the United States proposed mobilising $8.5 billion through a blend of grants, concessional and non-concessional, and public and private finance to accelerate the closure of South Africa’s coal fleet and the rapid deployment of renewable energy systems. While the conditions and proportion of finance are still being negotiated, the partnership has been connected to recently passed energy reforms and plans for progressive carbon taxation in South Africa. Against the backdrop of a protracted power crisis, the new energy reforms have been seen as enabling increased use of private power plants. That several of the newly planned projects are dominated by multinational energy companies and include large investments from European private equity holdings has raised some red flags as the JET-P model is presented as a replicable model for decarbonization in the developing world.
The G7 agenda offered green investment plans for Vietnam, Indonesia, South Africa, India and Senegal to get them off coal. But, according to EIA data, G7 nations together consume about 1 billion tonnes of thermal coal annually. This is about 16% of the global thermal coal consumption. Global Energy Monitor tracks global annual emissions from coal power plants. According to GEM, the total annual CO2 emissions from coal power plants in G7 countries and EU member countries is about 1.9 bn tonnes.
Failure at home, saviour overseas?
The G7 ministerial meeting at the end of May agreed to “predominantly” decarbonise the power sector by 2035 without specifying the details, but intending to limit global temperature rise to 1.5°C. IEA’s net zero pathway for power sector decarbonisation for advanced economies is by 2035. The G7 strategy includes a phase out of all unabated coal power plants by 2030 and achieving abated gas power operational capacity that is just 2% of the global capacity between 2030 and 2050.
The G7 strategy is riddled with incoherence among its members. The US is yet to adopt domestic policy that ensures a 2030 coal phaseout or 2035 power sector decarbonisation. Japan’s domestic coal phaseout policies are also not in line with this year’s G7 agreement with almost a fifth of its total electricity demand consumption in 2030 projected to come from thermal power. To be in line with G7’s plan, Japan will need to completely phase out coal by 2030. The EU, which is home to three of the group’s seven members, is also faced with hurdles in implementing its decarbonisation strategy, particularly as the current energy crisis forces governments to reverse embargoes on coal power in the short term, and potentially lock-in new oil and gas investments through the next couple of decades.
This, however, has not stopped the G7 from expressing its interest in setting the agenda for climate action in other geographies, particularly in emerging markets and developing countries. The G7, in its latest inter-ministerial meeting, also publicised intent to create a ‘Climate Club’ by the end of the year to “incentivise green competition across the world.” In January this year, German Chancellor Scholz at the World Economic Forum in Davos expressed his support for such a coalition, with the G7 holding the seat of power. “We will use our Presidency of the G7 to turn that group into the nucleus of an International Climate Club,” the German Chancellor stated at the influential gathering.
The idea of a climate club is not entirely new. The most commonly referred version of the concept, such a club would have to function outside the ambit of the UN’s climate regime and hold the ability to enforce incentives and disincentives to member and non-member states, in order to overcome the low liability associated with voluntary emission reduction targets. A striking feature of this club would be the ability to impose sanctions on countries that fail to deliver on climate goals, while offering tariff-free trade for compliant members.
Sound familiar? That’s because the concept is basically the description of a cartel. Some features of such cartelisation are evident in military, trade and energy alliances. Most evidently, the US (and its allies) have been accused of using the status of the US Dollar as the world’s reserve currency to impose trade sanctions and restrictions on countries it views as adversarial, notably Cuba, Venezuela, Iran and Russia. The risk of politically motivated sanctions has resulted in the proposal of alternate reserve currencies in recent months.
Most optimistically, a climate club would incentivise ambition and accelerate action. More realistically, the creation of an exclusive club is likely to usher in the weaponisation of climate action, the rules of engagement for which would be subject to intense political interests and commercial lobbying.
Alex Scott, Programme Leader, E3G, said “The G7 launching new forms of global collaboration to tackle the climate crisis – the JETPs, the global shield, the climate club – show they see climate change as a threat multiplier they must address even amidst a challenging geopolitical context. But they forgot to demonstrate that new scale of action on their own climate action at home.
Offers of climate finance, but with conditions
Difficulties in delivering emission reductions at home, combined with the enormous opportunity of decarbonisation in emerging markets has resulted in a change of tact. Developed economies have shifted their climate finance strategy from asking “What are you doing?” to “What can we do for you?” writes Karl Mathiesen for Politico. “The idea is to put up hard cash and other sweeteners to shift them away from fossil fuels,” he adds. This magnanimity, however, is unlikely to be unconditional.
Unlike GCF funds, which are made available on a project-by-project basis, climate finance through alternate avenues are likely to be tied to structural reforms in recipient countries. While the JET-P in South Africa offers a glimpse of this, such conditionality has been a feature of development finance for decades. Among many examples, the case of IMF and World Bank loans to Ukraine elucidate how such an arrangement can be corrupted. The World Bank’s $350 million new loan to Ukraine, comes on condition of more energy reforms. Earlier, when the war began in Donbas in 2014, the IMF and WB forced Ukrainian energy assets to privatise leading to an increase in household gas prices by approximately 650%.
Taras Fedirko, an economic anthropologist at St. Andrew’s University, told The Breach that Ukraine’s oligarchs are not the only beneficiaries of the corruption—the Western financial system, the property market in places like London, New York, Ohio and elsewhere—they all benefit from the transfer of capital from Ukraine.
The risk of corruption isn’t the only concern either. Writing for Hindustan Times, former Indian climate negotiator RR Rashmi warns that the JET-P-like channels of funding offer existing official aid and private investments to emerging economies with no additionality or concession. According to Rashmi, almost 80% of the renewable energy finance in India is currently mobilised as debt finance from its own domestic financial institutions. Will the JETP finance expose investors to volatile international financial markets? Analysts warn that countries on international finance end up accommodating the risks of the global private investors throughout the domestic system.
Analysts have also argued that market-based instruments such as carbon pricing and monetisation should be scrutinised by the UN’s Open-ended intergovernmental working group (OEIGWG) on transnational corporations and other business enterprises with respect to human rights. OEIGWG’s mandate is to elaborate an international legally binding instrument to regulate, the activities of transnational corporations and other business enterprises.
India’s NDC: A balancing act
Given the political context, it is little surprise that India has played it safe with its NDC update. The scale up in ambition is modest. The absence of absolute targets for non-fossil fuel energy capacity, carbon removal or sectoral emissions signals that the second iteration of India’s NDC is also careful to avoid. India’s new NDC can be seen as being as much about cleaning up the old, as it is about setting forth the new.
Rather than in the form of a commitment, these targets would likely be a part of India’s long-term strategy on climate change, which it has thus far kept close to its chest. But the government has indicated it is willing to play ball, by once again explicitly mentioning the expectation of international finance. The expectation from developed economies for India to be more ambitious on climate action, will presumably be met with an expectation to shoulder a part of the costs. In other words, the availability of international finance will to a great extent dictate the scale of ambition in India’s climate change strategy.
The NDC update is politically savvy, delivering the balancing act demanded by India’s geopolitical interests. The Indian government will hope the developed world takes the bait, but it will have to be cautious of playing with fire, lest the country gets more than it bargained for- and not in a good way.
Inconsistent rainfall across states has hit rice production in India. A few months ago, it was wheat that took a hit because of intense heatwaves across the country. Uttar Pradesh, West Bengal and Bihar, which are major rice producers, have reported a rainfall deficit this monsoon season. Assam, another major rice producer, is reeling from intense flooding. According to experts, at least 15 million tonnes of rice production could be at risk.
Heatwaves impacted agricultural output in 9 Indian states: Report
Intense heatwaves in March and April this year impacted agricultural output in nine Indian states, according to a report by the Indian Council of Agricultural Research (ICAR). While wheat production took a massive hit, the heatwaves also led to pest infestations, poor vegetative growth, whitefly attacks and viral infections in crops and livestocks, the report found in Punjab, Haryana, Rajasthan, Jammu and Kashmir, Himachal Pradesh, Uttar Pradesh, Madhya Pradesh, Bihar and Maharashtra.
The Aridity Anomaly Outlook Index for July, issued by India Meteorological Department (IMD), concluded that 85% districts across the country are facing arid conditions. The report found 63 of 756 districts were non-arid, while 660 had mild, moderate to severe aridity despite the ongoing southwest monsoon. Data for the remaining 33 districts remained unavailable. Of the 660 districts, 196 are facing ‘severe’ dryness—65 of them are in Uttar Pradesh.
Heatwaves across continents continue to break temperature records
China is currently in the midst of a deadly heatwave with temperatures expected to exceed 40°C in almost 70 cities. Officials said another 373 cities and counties were expected to experience temperatures of 35°C and above. This is the second heatwave that China has reported for the month of July.
The heatwave in Europe, meanwhile, continues in the UK, Spain, Hungary, Croatia and France, among others. Five regions in France have been put on ‘orange alert’ with temperatures expected to reach 40°C after remaining constant at around 35°C throughout July. Spain got the dubious distinction of having the world’s first named heatwave in Seville. Heatwave ‘Zoey’ pushed temperatures past 43°C in the region.
In North America, two heatwaves were reported at the end of July. The first was between Oklahoma and Kansas and the second was between Oregon and Washington. In Canada, Lytton, a town in British Columbia, recorded a temperature of 42°C.
Climate hazards such as flooding have worsened 58% of infectious diseases: Study
Climate change-related events such as flooding, heatwaves and drought, have worsened around 58% of infectious diseases, including malaria, hantavirus and cholera, according to a new study. The study published in the journal Nature Climate Change observed medical literature of established cases of illnesses and found 218 of the known 375 human infectious diseases had worsened by one of 10 types of extreme weather connected to climate change.
India’s Cabinet approved an updated Nationally Determined Contribution (NDC) under the Paris Agreement this week. According to the new NDC, India now stands committed to reduce Emissions Intensity of its GDP by 45% by 2030, from 2005 levels. The previous NDC set a target of 33 to 35% compared to 2005 levels.
The country will also aim to achieve about 50% cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030. This was previously set at 40%. ‘Lifestyle for Environment’ or LIFE has been added to India’s NDC to further a healthy and sustainable lifestyle, which was first introduced to the world by Prime Minister Narendra Modi at COP26 as a key component in fighting climate change. The new NDC also seeks to capture a “citizen-centric approach to combat climate change”, the government said. India had submitted its first NDC to the UNFCCC back in 2015.
Energy Conservation Bill passed in Lok Sabha; will pave way for carbon markets in India
The Energy Conservation Amendment Bill 2022, an amendment to the 2001 Energy Conservation Act, was introduced in the Lok Sabha August 3, 2022 and passed in the lower house August 8. The bill seeks to increase the use of renewables and promote energy efficiency by widening the ambit of renewable energy use mandates, particularly on industry. It will effectively push for industrial decarbonisation through minimum non-fossil energy use mandates. Industrial sectors that have been mentioned include mining, steel, cement, textile, chemicals and petrochemicals), the transport sector (including railways) and commercial buildings. While the minimum mandates have not yet been specified, penalties for non-compliance will amount to up to Rs 10 lakh plus an additional penalty of twice the price of the oil equivalent of energy consumed above the prescribed norm. The Bill will also bring large residential buildings under the Energy Conservation Code, and open the doors for energy conservation standards to be applicable on products like automobiles and ships. The Bill also includes provisions to institute changes in the governing council of the Bureau of Energy Efficiency.
Importantly, the Bill provides for the issuance of carbon credit certificates (CERs) by the government or any authorised body. These certificates lay the grounds for the establishment of a carbon market in the country.
India requires $20 trillion capex in next 50 years to meet net-zero by 2070 target
The ambitious net-zero by 2070 goal announced by PM Narendra Modi at COP26 will cost the country dearly. According to a new report by research firm UBS, India will need a capital expenditure of $20 trillion over the next 50 years to achieve the ambitious target.
The report was also bullish on India’s ability to domestically produce solar cells, batteries and electrolysers. The report cited the example of rapid 4G implementation in India to demonstrate India’s ability to be self-reliant despite entering the renewables market much after China. The sector will have to be supported by policies, financial incentives and corporate backing, the report stated.
US set to pass bill that includes $369 billion in climate, energy spending
The US passed a bill that includes $369 billion in climate and energy spending. According to Democrats, this will achieve 80% of the work needed to meet the country’s 2030 climate target. The bill was passed after a dramatic U-turn by Senator Joe Manchin, who represents coal-rich West Virginia.
The Inflation Reduction Act of 2022 will direct the $369 billion toward clean energy and put the US economy on track to cut emissions 40% or more by 2030. The Act will likely be voted on in the House this week, where Democrats have a strong majority, and will shortly thereafter be signed into law by President Biden.
African nations to push for gas investments at COP27?
According to a report in The Guardian, African countries are likely to use COP27 to be held later this year to push for new fossil fuel investments across the continent. Considering the current global gas shortage, European nations are likely to support oil and gas exploration in Africa, the Guardian reported.
Climate Home News, however, reported that African climate diplomats rejected the African Union’s proposal that promoted gas at COP27 as a bridge fuel for the continent. According to the diplomats, a pro-gas stance at the UN summit was too controversial and would divert attention away from important issues such as climate finance and adaptation.
Australia set to pass its first climate change legislation in a decade
Australia’s House of Representatives passed the country’s first climate change legislation in more than a decade this month. Two emissions targets have now been enshrined into law as a result—a 43% cut below 2005 levels by 2030, and a reduction to “net zero” by 2050. It also gives the Climate Change Authority, an agency that was formed 10 years ago, a more prominent role after being largely ignored by the previous Coalition government.
It will now have to give yearly advice on how Australia can reach its climate targets and also advice on a new target for 2035. The Bill will now have to be passed in the Senate which is likely in September, but this is now just a formality, The Guardian reported.
In an apparent disregard of the fact that coal power plants, brick kilns, industries are set up around villages and the fact that rural areas burn solid fuel for cooking, the government said in Parliament that air pollution is primarily an urban phenomenon, therefore it was focussing on monitoring air quality in urban areas.
Just 26 of the 1,243 air quality monitoring stations covering 465 cities in the country are installed in villages—24 in Punjab and two in Dadra and Nagar Haveli and Daman and Diu, on an experimental basis. Aside from these, the government said it has sanctioned 17 monitoring stations in villages of Himachal Pradesh (5), Kerala (2), Mizoram (5), Odisha (2), Tripura (1) and Uttar Pradesh (2).
Experts said just because the government isn’t monitoring doesn’t mean air pollution doesn’t exist in rural areas. They pointed out that satellite data and studies that show air pollution is as big a problem in rural areas as it is in urban areas. Scientists said air pollution is a regional issue and all areas get affected.
Revised graded action plan to be implemented from Oct 1 in Delhi-NCR
According to the Commission for air quality management (CAQM), the revised graded action plan (GRAP) will be implemented from October 1 in Delhi NCR. The changed plan, according to experts, will be pre-emptive and will be invoked three days in advance of the air quality reaching a certain level based on forecasts, Indian Express reported. Earlier, GRAP was invoked when particulate matter concentrations reached a certain threshold.
The new plan includes the ban on construction activities (except for those involving the railways, projects of national security, hospitals, metro rail services, and linear public projects like highways, roads) will set in under the ‘severe’ category. Earlier, the construction ban was imposed only in the ‘severe +’ category. Construction activities on linear public projects like highways, roads, flyovers, pipelines and power transmission, will be banned under the ‘severe+’ category.
US study: Children may be especially susceptible to the effects of air pollution compared to adults
A new US study of blood samples showed that children have elevated markers of inflammation, such as interleukin 6, if they were exposed to higher air pollution. According to the American study, higher air pollution was linked to lower cardiac autonomic regulation in children, which impacts speed of the heart beats and how hard it pumps, Scientists said exposure to pollutants released during wildfires impacted children, who have smaller bodies and organ systems than adults, including asthma and decreased lung function, as well as neurodevelopmental outcomes like attention deficit hyperactivity disorder, autism, and deficits in school performance and memory.
Researchers looked at fine particulate matter data from the EPA (PM2.5), finding the children’s blood contained markers of systemic inflammation. Researchers have found children may be especially susceptible to the effects of air pollution, given that, compared to adults, they have a higher intake of contaminants and greater lung surface area relative to their body weight.
Centre along with Delhi, Punjab govts to give ₹2,500 per acre to Punjab farmers to stop stubble burning?
According to Delhi CM Arvind Kejriwal, the Punjab government proposed to provide Rs2,500 per acre cash incentive to Punjab farmers for not burning crop residue. The cash incentive will be contributed by the Punjab, Delhi and central government. The Punjab government proposed that it will give Rs500, the Delhi government will give Rs500 and the Central government can give Rs 1,500, Kejriwal said.
According to the System of Air Quality and Weather Forecasting and Research (SAFAR), the share of stubble burning to PM2.5 levels in Delhi peaked at 48% last year.
The Indian government proposed a scheme to set up virtual net metering and group net metering in villages to promote rooftop solar. The government said rooftop panels are prevalent in urban areas compared to rural areas because houses in villages cannot bear the weight of the panels. To take care this issue, the government proposed that instead of individual installations, village households can aggregate and set up group installations at one place. This will reduce transmission and distribution losses and improve power supply in villages.
The government requested electricity regulatory commissions to issue guidelines and notifications across India on virtual and net metering.
India installed over 8 GW of solar in first half of 2022
According to a study by the Central Electricity Authority (CEA) and JMK Research, India installed 8,359 MW of solar PV in the first half of the year, marking a huge rise of 71% compared to the same period last year, according to figures.
India may install 20 GW in the whole of 2022, made up of around 16.5 GW of large-scale PV and 3.5 GW of rooftop solar. This would be another huge jump up from the 12 GW deployed in 2021. IEEFA reported that the solar-rich state of Rajasthan has installed the most capacity by far this year with 4.5 GW, almost three times that of its closest rival Gujarat (1.5 GW), followed by the southern state of Tamil Nadu with 680 MW.
Shell buys 2.9 GW solar platform in India
Oil and gas company Shell completed the purchase of a 2900 MW renewables platform in India from Actis, company set up by Sprng Energy group. The Pune-based group develops and manages renewable energy facilities such as solar and wind farms and infrastructure assets.
Shell paid $1.55 billion for purchase in April, which includes 2.1 GW of operating assets and 800 MW of contracted capacity. The company has a further 7.5 GW of renewable energy projects in the pipeline. IEEFA reported that the solar and wind assets Shell is acquiring through the deal will triple its present renewable capacity in operation and help deliver its ambition of becoming an integrated power business.
Germany’s solar power production surges, wind-solar 2030 targets to double from 42% to 80%
According to newspaper Deutsche Welle, Germany’s solar power output is soaring and the country is on its way to make up 80% of electricity production with wind and solar by 2030, instead of today’s 42%. The newspaper reported July was the third month in a row when solar power output soared to a record level. In July, solar systems generated around a fifth of net electricity production in Germany—exceeding lignite-fired power plants, which brought in nearly 22%.
In another report, Germany’s solar manufacturing industry is falling apart because of a decade-long competition from Asia with German companies, which are filing for bankruptcy or being sold abroad. Volker Quaschning, professor at the Berlin University of Applied Science told the news portal that Germany is more than 90% dependent on solar module imports from Asian countries.
Private miners may soon be able to extract lithium for battery production. The Indian government is trying to change a law that will allow private miners to do this in a bid to boost self-sufficiency with regards to green technologies. Lithium is an important component of batteries for electric vehicles and energy storage. According to the government’s plan, eight minerals will be removed from the restricted list that private miners are forbidden to mine from. These include lithium, zirconium and beryllium.
Ola to let go of 1,000 employees as it shifts focus towards electric mobility
In the backdrop of plans to expand its electric mobility business, Ola is set to fire 1,000 employees, ET Energy world reported. It quoted executives as saying the mobility firm is hiring “aggressively” for its electric mobility vertical, and cuts are expected in other verticals including hyperlocal, mobility, fintech and the company’s used car business. An employee was quoted as saying the company was deliberately delaying appraisals of those it wants to fire so that they quit voluntarily.
Goa becomes first state to discontinue subsidy for electric vehicles
Goa became the first state in India to discontinue electric vehicle subsidies. The Department of New & Renewable Energy, Government of Goa, recently issued a notice saying the subsidies will be discontinued starting July 31, 2022.
The subsidy amount was capped at Rs30,000 per vehicle for two-wheelers, Rs60,000 per vehicle for three-wheelers and Rs3 lakh per vehicle for four-wheelers, according to the Goa Electric Mobility Policy, first introduced in December 2021. The policy also capped the number of electric vehicles eligible for the subsidy—3,000 two-wheelers, 50 three-wheelers and 300 four-wheelers.
The coal crunch afflicting India’s thermal power plants seems to be easing. The Central Government, which in May had ordered the use of 10% imported coal for blending with domestic coal at power plants, has decided to rollback the mandate. The withdrawal of the blending order comes at a time when the country’s coal stocks have been replenished to 31 million tonnes, the highest number recorded for August. “The coal stock position in power plants has been reviewed periodically with the stakeholders, including ministry of coal and ministry of railways. It has been decided to withdraw the aforesaid order dated 26th May 2022, with immediate effect,” read the order issued on August 11. Amidst the coal shortages in the first two quarters of the year, Coal India Ltd has upped its production. While the first quarter saw 19% growth compared to last year, the public mining company plans to dispatch 700MT this year- about 18% higher than last year.
G7 seeks a price cap on Russian oil before December 5
Anticipating a harsh winter that could see oil prices surge again, G7 leaders are cautious about the viability of a complete ban on Russian oil. The EU’s latest rounds of sanctions, which will prohibit insurance and finance services to shipping companies transporting Russian oil, will come into effect on December 5. The sanctions are expected to put upward pressure on prices. The G7 is now looking to get ahead of the curve by installing a price cap that would ensure the avoidance of a supply shock but would also limit Russia’s revenues through oil.
World’s coal consumption to reach record levels this year, says IEA
Global coal consumption is set to see another year of strong growth, taking it back to record levels reached almost a decade ago, according to a new IEA report. Coal demand has seen a sharp upturn since the COVID lows as a rapid economic recovery was followed by turmoil in the energy markets. Now, the IEA states that if the Chinese economy recovers as expected in the remainder of the year, global coal demand would rise by 0.7% to touch 8 billion tonnes. Worryingly, the demand, which matches the record of 2013, is likely to increase further next year. Apart from China, India and the EU have seen spikes in coal demand this year due to increased power demand and rising costs of gas.
Australia rules out banning fossil fuel projects; will support those that ‘stack up’ economically and environmentally
Climate action laggard Australia is currently debating its Climate Change bill, which was passed in the lower house of the Australian parliament last week. While the bill seeks to reduce emissions by 43% by 2030 relative to 2005 levels, Australia’s new Labour government has ruled out any complete ban on fossil fuel projects. “If Australia today said we are not going to export any more coal, what you’d see is a lot of jobs lost, you would see a significant loss to our economy, significantly less taxation, revenue for education, health and other services, and that coal wouldn’t lead to a reduction in global emissions, what you would see is a replacement with coal from other countries that’s likely to produce higher emissions … because of the quality of the product,” said Prime Minister Anthony Albanese in justification of the move. The PM’s statement was followed by Australia’s Federal Resources minister claiming in a speech to Queensland’s resource industry that fossil fuel projects would be greenlit provided they “stack up” economically and environmentally.