While several countries are pulling away from deep sea mining largely due to concerns over biodiversity loss, India has taken significant steps in the recent past to facilitate it to meet its ambitious energy transition goal. Read more
While these deep sea nodules are claimed to have higher concentrations of minerals than terrestrial ores, deep sea mining carries inherent risks to marine biodiversity. Photo: Geomar Bilddatenbank/Wikimedia Commons
Deep sea critical minerals for energy transition: Mine over matter
While several countries are pulling away from deep sea mining largely due to concerns over biodiversity loss, India has taken significant steps in the recent past to facilitate it to meet its ambitious energy transition goal
The world is in the process of putting together a new energy economy—one that promises energy security without compromising on quality. Ever since such a low-emission economy was postulated, the massive resource requirement of such systemic change has been painted as inconvenient, but inevitable. The inevitability of this new “gold rush” for minerals and materials critical to the energy transition seems now to be coming to a head.
As a summer marked by extremes roiled the world, governments met in Kingston, Jamaica, in the last week of July to try and agree on regulation for the extraction of minerals from international waters. Although consensus remained elusive, the meeting did provide the clearest sign yet that the ambivalence is becoming increasingly untenable.
Meanwhile, closer home, India, like several other countries, is preparing to take a plunge into territorial waters in search of critical minerals. The recently concluded monsoon session of the Indian Parliament saw the passage of the Offshore Minerals (Development and Regulation) Amendment Act, 2023, which seeks to facilitate the exploration and extraction of critical minerals (also known as deep sea mining) in the territorial waters off India’s 7,500 km-odd coastline.
The deep sea mining brouhaha
The energy sector is the most significant contributor to GHG emissions, and any climate change mitigation action requires transition toward low-carbon pathways. This energy transition depends upon energy technologies that require a variety of critical minerals, such as lithium, cobalt, manganese, graphite, nickel, copper, chrome, and rare earths.
The International Energy Agency (IEA) estimates that climate targets would need at least four to six times more of these “critical” minerals by 2040. Such estimates have understandably attracted governments and industry to increase the exploration and extraction, and push for diversification of supplies. Besides land-based mining, sea beds are also being explored to harness the rich critical mineral reserves therein.
As the name suggests, deep sea mining is the process of extracting minerals from the deep sea bed or ocean floor. Deep sea nodules and deposits are rich in critical minerals such as nickel and cobalt. Mining these implies dredging of the sea bed and the deployment of heavy machinery to collect or pump the ore up to the surface.
Scientific community and civil society have raised concerns over the multitudinal risks and irreversible impacts of deep sea mining on marine ecosystem and biodiversity. But with the intersection of energy security, resource-independence and climate mitigation coming into sharp focus over the past few years, support for deep sea mining has grown stronger. One of the main supporting arguments is that mining critical minerals from the ocean floor will have a smaller environmental impact than mining them in tropical rainforests. Deep sea nodules are also claimed to have higher concentrations of minerals than terrestrial ores. Nevertheless, deep sea mining carries inherent risks to marine biodiversity, and neither the experience nor the standards exist to minimise impacts.
Whose sea is it anyway?
If a tree falls in a forest, and no one is around to hear it, does it make a sound? The answer of course is yes, but it does make the impact much easier to ignore.
In view of the large realm of unknown and incomplete understanding of the impacts and their management, policy discourse around deep sea mining is replete with demands from states, scientists, environmentalists and even industry to adopt a precautionary approach to allowing exploitation of minerals from the seabed. And herein lies the root of disagreement when it comes to international consensus on a common set of principles and rules for deep sea mining.
Under the International Law of the Seas, coastal states have the sovereign right to explore, exploit, conserve, and manage natural resources on and under the seabed in the exclusive economic zone, i.e., area up to 200 nautical miles from the baseline. Resources in the area of the seabed and ocean beyond this Exclusive Economic Zone (EEZ) are considered to be ‘the common heritage of mankind’, where no state can claim sovereignty or sovereign rights, and exploration and extraction of resources is to be ‘carried out for the benefit of mankind as a whole’.
The International Seabed Authority (ISA), an autonomous international organization established under the 1982 United Nations Convention on the Law of the Sea (UNCLOS) and the 1994 Agreement relating to the Implementation of UNCLOS, is responsible for the supervision and regulation of resource development from the seabed. Thus, deep sea mining within the EEZ is governed by domestic regimes, and mining beyond EEZ falls under the purview of the ISA.
As of now, the ISA has adopted regulations only for exploration activities in the seabed and ocean floor beyond national jurisdiction. The ISA reviews the applications and plans for exploration based on the Exploration Regulations for polymetallic nodules, polymetallic sulphides, and cobalt rich ferromanganese crusts. The applicants for contracts are mandated to provide evidence of technical and financial capabilities to carry out exploration, description and a schedule of the activities, a preliminary assessment of possible environmental impact and proposed measures to prevent, mitigate and control marine pollution. Guided by precautionary principles and the guidance document prepared by the Legal and Technical Commission of the ISA, contractors have to carry out an EIA prior to commencing any exploration activity.
Government entities, as well as private entities, can obtain ISA approvals for deep sea mining contracts in the area. Still, private entities must be sponsored by a state party to which they belong or through whom they are controlled. Thus, even with private companies taking a lead, state sponsorship ensures that there is some legal system with which these companies comply. Out of the 169 members of ISA, around 20 have sponsored government or private entities to enter into exploration contracts with ISA since 2002.
ISA Regulations for prospecting and exploration of deep sea mineral deposits have been in place for nearly two decades. However, the regulations for extraction have been in the making since 2014 and are still not finalised.
This is where the Pacific island-nation of Nauru enters the picture. Among the most vulnerable to sea-level rise and impacts of climate change, the country applied for permission to begin mineral extraction in the Clarion-Clipperton Zone in the North Pacific in June 2021. The application, made on behalf of Nauru Ocean Resources Inc (NORI), a subsidiary of a Canadian company DeepGreen, triggered a so-called “nuclear option” at the ISA, which gave the group a two-year deadline to finalise rules and facilitate the approval of Nauru’s proposal.
This window lapsed on July 9 this year, and with rules yet to be finalised, the “nuclear option” has thus far delivered more of a whimper than a bang. In its latest meeting, the ISA has given itself a two-year extension.
The past couple of years, though, have seen some progress. As reported by the Earth Negotiations Bulletin of IISD, at the 28th Session of ISA in March 2023, states agreed that firstly, there is no obligation to approve the plan of work, and secondly, a provisional approval of a plan of work does not amount to final approval or an exploitation contract.
However, operational issues such as guidelines, directives, or instructions, and the process to be followed after provisional approval are yet to be agreed upon. At the second negotiation of the 28th Session of the International Seabed Authority concluded on July 28, countries failed to reach consensus on rules, regulations and procedure (RRP) for extraction, and the Council has pushed the deadline to the ISA Session in 2025.
The consensus seems difficult to reach as some countries that had earlier been active in deep sea mining exploration have slowed down or paused, while there are others who are looking at increasing their exploration and moving towards exploitation of deep sea minerals. The interest shown by several companies, countries, and even the ISA has been put forth in the context of clean energy technology requirements, thereby providing an environmental justification for expediting the extraction of minerals from the seabed. Norway, China, and India have shown more interest in deep sea mining in recent times. Some of the countries that have halted their operations or called for a precautionary pause include Ireland, Germany, Spain, Chile, Ecuador, Vanuatu. Others like Switzerland, Fiji, Samoa and New Zealand call for a moratorium.
Coming to Indian shores now
India has set an ambitious energy transition goal of 500 GW of installed capacity of non-fossil based electricity by 2030 and reducing emissions intensity by 40%. The clean energy technologies that can help in attaining these goals require critical minerals, many of which are not produced in India. To this effect, the government has been trying to increase and encourage exploration, on land and offshore.
India has a 7,517km coastline and an exclusive economic zone of more than two million square-km. The vast coastal and marine territory is a reservoir of not only biodiversity, but also economic resources like crude oil, natural gas and other mineral resources. India’s territorial waters (an area up to 12 nautical miles from the coastal baseline) have been estimated to contain 79 million tonnes of heavy mineral resources based on the Geological Survey of India’s ‘limited capacity’ assessment.
In 2021, the National Institute of Ocean Technology, with its indigenously designed the deep sea mining machine, Varaha-1, undertook an exploration test collecting polymetallic nodules containing critical minerals like nickel, copper and cobalt from the Central Indian Ocean. This was quickly followed by the Deep Ocean Mission in 2021, launched by the Ministry of Earth Sciences. With the development of technologies for mining in Central Indian Ocean included as a key objective of the mission, the Samudrayaan Project for deep ocean exploration was announced in late-2021. Under this project, an exploration trial for Polymetallic Manganese Nodule was conducted at a depth of 5270m in December 2022. Last year, the Ministry of Earth Sciences also introduced the draft Blue Economy Policy, which had minerals as one of the focus areas. India’s interest in ocean-based economies was also reflected in its G20 agenda with considerable space devoted in the Climate, Environment and Sustainability Working Group outcome document, including the subject of exploration and exploitation of deep sea minerals.
Earlier this year, the Ministry of Mines invited comments on draft amendments to the Offshore Area Mineral (Development and Regulation) Act, 2002, to facilitate auction of deep-sea mining blocks for exploration licence-cum-production lease. The Offshore Areas Mineral (Development and Regulation) Amendment Act, 2023 was introduced and passed in Parliament during the recently concluded monsoon session. The amendment, made on the lines of the Mines and Minerals (Development and Regulation) Act for terrestrial minerals (which itself has been amended this year to expand private exploration and extraction), aims to encourage private participation in offshore mining. In addition to atomic minerals, some critical mineral deposits, such as those bearing beryllium, lithium, rare earths, niobium, titanium, zirconium, are reserved for government companies. Concerns have been raised against these measures by communities and civil society, but the government has maintained that these activities would not lead to overexploitation or adverse impact on the livelihoods of communities, but in fact may create additional opportunities in future.
Operating rights will be granted to the private sector through auction by competitive bidding for two types of contracts—production leases and composite licences. Composite licences have been described as a two-stage operating right to facilitate both exploration and extraction. Funds for preliminary explorations will be made available through a fund held under the Public Account of India and maintained by a non-lapsable ‘Offshore Areas Mineral Trust’. The fund will be replenished by an additional levy on mineral production—not exceeding one-third of the royalty.
India’s legislative support for deep sea mining has not come in isolation. At the international arena, India has been a member of the ISA since 1995. The Government of India (GoI) is one of the 22 entities worldwide that entered into exploration contracts with the ISA. GoI entered into a 15-year contract with the ISA in 2002 for the exploration of polymetallic nodules (PMN) and polymetallic sulphides (PMS) from a 75,000 sqkm area in the Central Indian Ocean. This contract was later renewed twice, and the Varaha-1 tests were carried out under this allocation by ISA.
It may be interesting to note that while several countries are pulling away from deep sea mining, India has renewed its contract with ISA recently and is looking to invest more in it. On his recent visit to India earlier this year, the Secretary General of ISA called India a ‘pioneer investor’ with the potential to become a leader in deep sea mining. The Indian government has, however, also maintained its stance supporting a balanced approach for the sustainable use of deep sea resources at the 28th Session of ISA.
A risky rush
While the ISA now has two-more years to frame regulation for extraction of deep sea minerals, the recently lapsed deadline has undoubtedly dented trust in the process. The pressure on the ISA to resolve the deadlock is now palpable, so is the sense of impatience. Even with the extension, the ISA has a weighty task at hand.
Firstly, A more proactive approach by ISA is needed in regulating the exploration of critical minerals. The Nauru example should serve as a reminder not just to ISA, but to all the countries that preparedness is crucial. Adopting a precautionary approach is important for signalling, but is useful only if the waiting period is used to develop standards, regulations, guidelines and institutions for governance. Since several countries and companies continue to invest in DSM, it is best to be prepared for a commercial exploitation scenario.
Secondly, more risk assessment studies and analyses are needed to avoid the rhetoric of land vs. sea mining in terms of environmental impact.
Finally, a much wider group of stakeholders need to be included in the discussion. ISA must invite views of more companies with mining as well as undersea activities to make informed decisions. Similarly, perspectives from the civil society should reflect concerns of environmental groups as well as those working in the area of energy and mining to understand the energy transition – deep sea mining linkage clearly.
ISA’s decisions on deep sea mining will carry far-reaching implications. While the economic rationale is writ large on the surface, dredging the depths of the issue reveal a far more complex reality, which will have to be weighed carefully for risks, both known and unknown.
Nidhi is an independent law and policy consultant based in New Delhi. She is writing her doctoral thesis on governance of critical minerals for energy transition.
Consistent ice-collapsing occurrences and glacial retreat are among the alarming symptoms of the glacier's degeneration.
Risks of glacial lakes outbursts looms due to accelerated glacier retreats in Ladakh: Study
According to a recent study, the Parachik glacier in Ladakh has been retreating quickly, averaging 20 metres per year between 2015-2021 after previously retreating at an average of two metres per year between 1971-1999. This can make the area more susceptible to flash floods. Additionally, because glaciers are rapidly retreating, problems with water scarcity may get worse. The Suru river, a vital source for Ladakh’s Kargil district, receives its water from the 53 sq km Parachik glacier in the Zanskar peaks. Consistent ice-collapsing occurrences and glacial retreat are among the alarming symptoms of the glacier’s degeneration that have been observed.
Monsoon entering weaker phase, following months to be drier than usual: IMD
The India Meteorological Department has said that the south-west monsoon has entered a weak phase after 5% excess precipitation in July marked by extreme rainfall in some areas including Himachal Pradesh, Uttarakhand, and the northern plains. Central and peninsular India is now likely to experience subdued rain. IMD also acknowledged El Nino conditions setting in, impacting the monsoon. While a rainy July in monsoon 2023 led to floods and flash floods in several states, the next two months may be drier than normal for most of the country. Most parts of southern and many parts of western, north west and central India may receive below normal rainfall in these two months. This could worsen the existing deficit in states like Bihar where many regions are facing severe water shortages and the groundwater levels of 10 out of 38 districts in the state have sunk excessively.
Scientists ‘virtually certain’ that extreme Antarctic events will get worse, need drastic action
According to a recent assessment, future catastrophic occurrences in Antarctica are “virtually certain” to be worse than the changes already seen. In addition to recent extremes such record low sea ice levels, the loss of ice shelves, and surface temperatures up to 38.5C above average over East Antarctica in 2022—the world’s largest ever recorded heatwave—the study compiles evidence on the fragility of Antarctic systems. A new record for sea ice extent was set in July of this year, three times farther from the average than what had previously been witnessed. In July 2022, sea ice extent reached a record low for that time of year. According to one of the study’s authors, the rate of land-ice loss “matches the IPCC’s worst case”. The observations, according to the authors, demonstrate that we are headed in the direction of the most extreme scenario. The study said that it is “virtually certain” that future Antarctic extreme events will be more pronounced than those observed to date.
Ocean warming breaking records, severe implications underway
The EU’s climate change service Copernicus said that the average daily global sea surface temperature earlier this month beat a 2016 record, reaching 20.96°C— far above the average for this time of year, the BBC reported. This followed a series of marine heatwaves this year including in the UK, the North Atlantic, the Mediterranean and the Gulf of Mexico. Last month, sea surface temperatures in Florida reached a hot tub-like 38.44 °C. Normally, according to the National Oceanic and Atmospheric Administration (NOAA), temperatures should range between 23°C and 31°C.
Oceans generate half of the oxygen on Earth, absorb heat, and control weather patterns. Since carbon dioxide cannot be as easily absorbed by warmer waters, more of the planet-warming gas will remain in the atmosphere. Additionally, it may hasten the melting of glaciers that melt into the ocean, causing the sea level to rise even faster.
Floods wreck China’s leading grain-producing region, food insecurity feared
According to the state-run media in China, flash floods have led to the evacuation of about 18,000 people from Shulan, China’s leading grain-producing region in the northeast. Further north in the neighbouring province of Heilongjiang, rivers that irrigate its fertile farmlands have overflowed, submerging rice fields, destroying vegetable greenhouses and damaging factories, the channel added. This questions the state of food security in the region as major food production hubs are underwater. A researcher told Bloomberg that China’s “sponge city” strategy, which uses rooftop gardens, permeable pavements, and other sponge-like features to soak up heavy precipitation – ignores the extreme events and disasters like the flash flood.
Under the AIF scheme, farmers were entitled to loans to create the said infrastructure along with community farming assets by 2025-26.
Only 15% of ₹1 lakh crore agri infra fund disbursed since 2020 launch
In 2020, the government launched the ₹1 lakh crore Agriculture Infrastructure Fund (AIF), for the development of post-harvest infrastructure. But recent data revealed only 15% of these funds have been disbursed so far. AIF was launched during the COVID-19 lockdown as part of the government’s Aatmanirbhar Bharat initiative.
Under the scheme, farmers were entitled to loans to create the said infrastructure along with community farming assets by 2025-26. The scheme also promised reduced interest rates and credit guarantee assistance until 2032-33. But the government recently informed Parliament that as of August 1, 2023, only ₹15,448 crore has been disbursed for 27,748 projects. Of these, 19,650 projects worth ₹9,660 crore (9.66% of the total allocation) have been completed, the government claimed.
Expert group on climate finance meets in Dubai, begins work on framework before COP28
As it gears up to host COP28 — the 28th session of the UN’s flagship conference on climate change, UAE this week hosted a meeting of the Independent High-Level Expert Group (IHLEG) on climate finance. The two-day meeting of several world-leading economists and financial experts convened by the COP28 presidency was able to arrive at consensus on how to move forward in building a new framework for international finance over the next three years. Picking up from a report published by the IHLEG in November 2022, the group stated that an annual investment of $2.4 trillion would need to be mobilised by 2030 for adequate financing of mitigation in emerging markets and developing economies.
The framework, which is intended to provide short- and long-term guidance to UN agencies, the IMF, WB, regional multi-lateral development banks (MDBs), national governments and the private sector, will especially focus on debt distress in vulnerable countries and the role of the private sector. “The IHLEG group, the COP28 president and all the esteemed colleagues gathered here agree that raising the $2.4 trillion will not be sufficient if we do not accelerate implementation,” remarked Vera Songwe, co-chair of the group.
Credit rating of India, among others, to take a hit due to climate change; Indian banks unprepared
A recent study found connections between the effects of climate change and a nation’s creditworthiness. Without emission reductions, 59 nations’ sovereign credit ratings, including India, might be lowered, and global corporate debt over the following ten years could increase. India, China, Chile, and Indonesia would all fall two points. According to the study conducted by the University of East Anglia (UEA) and the University of Cambridge, the United States, Canada, and the United Kingdom would all drop two places and one spot, respectively. The findings indicated that unless steps are taken to cut emissions, many country economies might anticipate downgrades. The study found that while countries with better credit scores were likely to experience more severe downgrades, emerging countries with lower credit scores were anticipated to be struck harder by the physical effects of climate change.
A separate analysis prepared by Bengaluru-based think tank Climate Risk Horizons has found that major Indian banks are unprepared to confront climate risks. The analysis added that not a single bank has yet undertaken climate-related scenario analyses and despite being the cornerstone of India’s climate strategy, public banks in particular are failing to sufficiently support the country’s energy transition.
Brazil spearheads conservation pact between 8 countries to save Amazon rainforest
Eight countries, including Brazil, that surround the Amazon river basin united to conserve the rainforest plagued by deforestation. Leaders signed the Belém Declaration, which gives a conservation roadmap that aims to save the world’s largest rainforest from rampant industrial agriculture and land-grabbing. Bolivia, Brazil, Colombia, Ecuador, Guyana, Peru, Suriname and Venezuela will coordinate with each other on law enforcement and pooling funds for conservation and sustainable employment for locals.
UK’s carbon prices drop drastically; might derail decarbonisation efforts, say experts
The UK carbon emissions trading scheme puts a price on the emission of one tonne of CO2, similar to the EU. Some companies, such as the ones that generate electricity, are given allowances that help cover some necessary emissions. Under the scheme, these allowances are to be gradually cut.
But this year, the UK government said it was handing out an additional 53.5 tonnes of extra allowances between 2024 and 2027. This has resulted in a steep drop in the price of carbon in the UK as compared to the EU. According to experts, strong carbon pricing is a must to attract investments in clean energy and make it more affordable. They fear this strategy is likely to hinder the UK’s decarbonisation efforts.
A 10% rise in annual PM2.5 globally could lead to a 1.1% increase in aggregate antibiotic resistance and 43,654 premature deaths, the paper stated. Photo: Ninara_flickr
PM 2.5 air pollution increases anti-biotic resistance globally, India risk increases 2.5%
A recent study published in Lancet established links between fine particulate matter (PM2.5) air pollution and antibiotic resistance. According to the study, Africa and Asia are at maximum risk of antibiotic resistance, The study presented the first global estimates of antibiotic resistance and burden of premature deaths attributable to antibiotic resistance resulting from PM2.5 pollution. The study found significant correlations between PM2.5 and antibiotic resistance globally in most antibiotic-resistant bacteria. The paper said the correlations have strengthened over time.
A 10% rise in annual PM2.5 globally could lead to a 1.1% increase in aggregate antibiotic resistance and 43,654 premature deaths, the paper stated. Saudi Arabia would have a 3% increase in antibiotic resistance if PM 2.5 increases by 10%, Niger would see a 2.9% increase, United Arab Emirates a 2.6% increase, Pakistan a 2.6% increase, Nigeria a 2.5 % increase, India a 2.5% increase, Cameroon a 2.2% increase, Bahrain a 2.2% increase and China a 2.1% increase, reported Down to Earth quoting the Lancet paper.
China and India could be the countries where changes in PM2.5 have the largest effect on premature deaths attributable to antibiotic resistance due to their large populations, DTE wrote.
Study: PM 2.5 exposure increases non-lung cancer risks in older adults
According to a new study conducted at Harvard Chronic, exposure to PM2.5 and nitrogen dioxide (NO2) may increase non-lung cancer risk in older adults. In a cohort study of millions of Medicare beneficiaries, the researchers found that exposures to PM2.5 and NO2 over a 10-year period increased the risk of developing colorectal and prostate cancers. The researchers also found that even low levels of air pollution exposure may make people particularly susceptible to developing these cancers, in addition to breast and endometrial cancers.
Scientists said they uncovered the biological plausibility of air pollution as a crucial risk factor in the development of specific cancers, bringing us one step closer to understanding the impact of air pollution on human health. According to the scientist working on the project, to ensure equitable access to clean air for all populations, we must fully define the effects of air pollution and then work towards reducing it.
Air pollution speeds progression of lung diseases, UK study finds
A new study of over 250,000 people in the UK found air pollution speeds up the progression of lung disease. The health of 266,000 adults was tracked for an average of 12 years. So far, researchers have looked at links between air pollution and single health outcomes such as asthma, emergency hospitalisation or to death. In the new study, researchers tracked people’s lung health from being illness-free, to having long-term lung conditions and to early death. The Guardian reported that by the end of the study, 13,863 people developed either asthma, lung cancer or chronic obstructive pulmonary disease (COPD) and 1,055 then developed multiple lung illness.
Around 14% of the people who developed one chronic lung problem then went on to to die during the study, as did 31% of people who developed multiple lung diseases.
The study covered factors such as smoking, obesity, occupation and income in the analysis. The impacts were strongest for particle pollution, even though average concentrations near the volunteers’ homes were close to the 2040 target for England and that proposed for the EU for 2030, the report said, adding that this suggests that current targets are not safe.
Study: Coal coking operation closure brought 42% immediate drop in cardiovascular emergency cases
A study conducted to assess health benefits of reduction in air pollution after closure of Shenango, Inc. coke plant in Pittsburgh, PA US found significant cardiovascular health benefits in the local population, including a 42% immediate drop (95% CI: 33%, 51%) in cardiovascular emergency department (ED) visits from the pre-closure mean. A longer-term downward trend was also observed for overall emergency visits at −0.14 (95% CI: −0.17, −0.11) visits per week rate of decrease after the closure, vs. a rise of 0.17 (95% CI: 0.14, 0.20) visits per week before. The study points out inpatient cardiovascular hospitalizations per year showed a decrease after closure (−27.97 [95% CI: −46.90, −9.04], as compared with a 5.09 [95% CI: −13.84, 24.02] average increase in cases/year over the prior three years).
The researchers said closure of a coal coking plant provides an ideal ‘natural’ experiment opportunity to rigorously evaluate the health benefits of air pollution emissions reductions. The closure brought 90% decrease in nearby SO2 levels, as well as significant reductions in coal-related fine particulate matter constituents (sulfate and arsenic).
According to the tender, a single developer can bid for a cumulative contracted capacity of 50 MW to 400 MW in multiples of 10 MW.
New solar auction norms cap max capacity at 50% for single bidder, PPA for 20 years
The Centre introduced new guidelines for competitive bidding for grid-connected solar power projects. New norms will apply to all upcoming solar power projects, with or without energy storage. There were no guidelines for energy storage earlier. The power purchase agreement (PPA) is set at 20 years, earlier it was 25 years. Bidders will be allocated the power capacity they offered only if their tariff offers fall within 2-5% of the lowest bidder’s tariff. Now, a maximum of 50% of the total capacity can be allocated to a single bidder. Previously, there were no restrictions. For projects up to 1,000 MW capacity, the power supply must begin within 24 months of signing the PPA, while for above 1,000 MW capacity, projects should start within 30 months of PPA. If delayed, the contracted capacity will be reduced to the project capacity that has already started supplying power within the scheduled commissioning date plus six months. The PPA for the remaining contracted capacity that has not started supplying power will be terminated.
House panel asks govt action-taken report on tidal energy production ‘without delay’
A Parliamentary standing committee asked the Centre to report on action taken on starting tidal energy production in the country. In theory, the estimated potential of tidal and wave power in India is 12,455 MW and 41,300 MW, respectively. A study, Tidal and Wave Energy in India — Survey on Potential and Proposition of Roadmap, conducted jointly by IIT-Chennai and Credit Rating Information Services of India Ltd, suggested a roadmap to set up commercial tidal power projects by 2030. The house panel asked the Centre to submit an action-taken report on the findings of the study and the proposed roadmap, without delay.
Down to Earth reported that on August 22, 2019, that the government issued a notification clarifying that energy produced using various forms of ocean energy such as tidal, wave, ocean thermal energy conversion, etc. shall be eligible for meeting non-solar renewable purchase obligations.
The panel also asked to be apprised about the proposed share of tidal power in the renewable energy targets for 2030 in the report.
Kerala to set up ₹30,000 crore green hydrogen, green ammonia plants for export and domestic use
Kerala received proposals to set up green hydrogen and green ammonia production plants for export and domestic use. One of the companies have proposed to export one lakh tonnes of green ammonia to Germany from Vizhiniam Adani port in the state. The plant will run on solar power with pumped-hydro storage to assure round-the-clock (RTC) energy supply. ]The pumped-storage power plant with RTC renewable energy will be set up by Kerala State Electricity Board.
The other company proposed to set up a ₹8,763 crore 252-MW electrolyser plant along with a green hydrogen and ammonia generation plant. Earlier this year, the state released its draft green hydrogen policy and also announced a ₹200-crore scheme for setting up two green hydrogen hubs.
RE trades 53.3% low in July compared to 2022, short-supply due to rise in coal production
Renewable energy traded 275 million units (MU) in July 2023 at the Indian Energy Exchange (IEX), a year-over-year (YoY) decline of 53.3% from 589 MU and marginally increasing from 272 MU in June, Mercom reported. The total traded volume reached 8,522 MU, by July-end, which was a year-over-year (YoY) increase of 19%. The trading price settled at ₹4.55 (~$0.055)/kWh, 16% down from the previous year. A low supply situation persisted throughout July due to increased coal production, decreased costs of e-auctioned coal, and lower imported fuel prices.
Solar installations down 48% YoY during Q1 2023, generation up 21% same period
The first quarter of 2023 saw solar installations fall by 48% compared to the same period last year. Quarter-on-quarter, the drop recorded is 30%. India added more than 4.1 GW of overall power capacity in the quarter, of which 45% came from solar energy sources. The cumulative solar capacity in India presently is 64.5 GW.
Despite the sharp decline in new installations, solar generation grew to 30 billion units (BU) in the second quarter of 2023 — a 20.8% year-on-year increase and a 5.5% increase quarter-on-quarter. Rajasthan, Karnataka, and Gujarat were the top solar energy-generating states. Over the first half of 2023, the country generated 59.79 BU of solar energy— a 25.5% increase from the 47.64 BU generated over the same period last year.
The government will fund ₹ 200 billion of the cost of the scheme, based on a public-private partnership model.
India approves $7 billion plan for 10,000 electric buses in 169 cities in next 10 years
The Centre has approved around a ₹580 billion ($7 billion) scheme to deploy 10,000 electric buses in 169 cities by 2033 along with charging and associated infrastructure facilities, Reuters reported. The government will fund ₹ 200 billion of the cost of the scheme, based on a public-private partnership model. The newswire added that it was not immediately clear whether the remaining funds would come from state governments or private companies.
Chasing a target of 50,000 electric buses nationwide, at an estimated cost of $12 billion, the centre has been aggregating demand from state governments and issuing contracts or tenders inviting companies to bid.
Following the announcement shares of Electric bus makers Olectra Greentech and JBM Auto rose up and closed up 8.8% and 10.1% respectively. Tata Motors was up 1.9%, while Ashok Leyland, which has a unit that makes electric buses, pared a 2.5% rise to settle 0.9% higher.
A phased manufacturing plan likely in pipeline for EVs
The Times of India reported that the government may implement a programme similar to a phased manufacturing plan (PMP) that would meet the needs of the whole industry while also creating a national ecosystem. Incentives in this market will help develop capacity in a new market without affecting domestic players like Tata Motors and Mahindra, who are investing heavily in the EV space even as Japanese companies are putting hybrids on Indian roads. This market will satisfy domestic demand as well as serve as a base for exports.
According to the report, discussions on a PMP that would establish a graded duty structure to support domestic manufacture are still in their early stages. However, insiders claimed that this may assist accelerate the switch to EVs while also gaining access to a developing market. A PMP programme would serve the demands of the industry and will be company agnostic. Additionally, it will support businesses as they gradually increase their level of localization, and incentives will be offered to promote investment.
Foxconn eyes India to make its third EV hub
One of the biggest contract electronics manufacturers in the world, Foxconn Technology Group, is looking into options to make India its third worldwide base for EV contract production. The Taiwanese corporation plans to provide five to seven lakh EVs by 2025, or 5% of all electric car sales globally. In India, Foxconn is already the biggest contract manufacturer of iPhones for India and other markets. Since 2015, the Indian division of Foxconn, Bharat FIH, has started producing electrical parts for EV two-wheeler manufacturers like Ather Energy and Ola Electric. A decision regarding the construction of an EV plant by the Taiwanese company with the governments of Telangana and Tamil Nadu is anticipated soon.
18,000 public EV charging stations needed in top nine cities: Govt
In response to a question in the Lok Sabha, the minister of heavy industries Mahendra Nath Pandey said that the top nine cities in India will need 18,000 public electric vehicle (EV) charging stations by 2030. The nine cities are Delhi, Mumbai, Pune, Ahmedabad, Surat, Bengaluru, Chennai, Hyderabad and Kolkata have a 4 million plus population and require 18,000 public EV charging stations by 2030. As of July, Maharashtra had the highest number of EV charging stations followed by Delhi and then Karnataka. As per the ministry of power, currently there are no targets fixed for installation of public EV chargers in the country. Pandey also said that 22,000 charging stations were being deployed by the petroleum ministry, which were set to be installed by December 2024. Of these 7,432 fell under the heavy industries ministry’s FAME-II subsidy scheme, where the central government was giving oil companies a subsidy of ₹800 crore to set up these charging stations.
ACC market demand to increase up to 220 GWh by 2030: Report
A new report by the Confederation of Indian Industries (CII) said that the advanced chemistry cell (ACC) battery market demand in India is expected to grow at a compound annual growth rate (CAGR) of 50% from 20 GWh in 2022 to around 220 GWh by 2030. The report ‘Raw materials for Battery & Component Manufacturing’ said India is anticipated to localise a sizeable chunk of the entire value chain, from material processing to pack assembly and integration, in order to support a strong local supply chain and the flourishing domestic battery manufacturing industry. As some raw minerals, including cobalt, nickel, and copper, have a minuscule reserve, production, and processing capacity in the nation, the research advised the establishment of domestic mining. The research recommended reducing the customs tariff on essential minerals used in battery production and encouraging the construction of mineral processing facilities to extract necessary materials.
China has witnessed protracted bouts of extreme weather through the summer including prolonged heatwaves and devastating floods which have affected both power demand and supply.
China’s coal imports surge as the country battles extreme weather
The first half of 2023 saw China’s coal imports double compared to the same period last year. The country has suffered protracted bouts of extreme weather through the summer including prolonged heatwaves and devastating floods which have affected both power demand and supply. The surge has also been attributed to the price competitiveness of imported coal over the first half of 2023. The resumption of coal imports from Australia earlier this year, after a two-year pause due to frosty diplomatic relations, between the two countries has also been a significant factor as coal imports surge to levels last seen before the break out of the Covid 19 pandemic in 2020. Interestingly, while 2023 has witnessed a sharp downturn in the Chinese economy and manufacturing, carbon emissions in the country are expected to return to record levels from two years ago.
UK to grant over 100 new oil and gas licenses in the North Sea
Citing energy independence, UK Prime Minister Rishi Sunak confirmed plans for oil and gas extraction from more than 100 new projects in the North Sea. In addition to these licenses, which were auctioned earlier this year, the PM also said hundreds of new licenses could be granted in the future. While the PM also announced fresh support for two carbon capture and storage clusters in northern England and Scotland, the plans to expand hydrocarbon extraction in the North Sea has put UK’s climate commitments under severe scrutiny. The North Sea remains one of the most exploited sites for oil and gas, with a history of extraction dating over 50 years. Known reserves in UK’s North Sea waters however have been on a steady decline since the late 1970s, and is currently at its lowest level ever – 237 million tonnes, which is under 20% of the peak known reserve capacity.
Government support for fossil fuels dealt a huge blow in US state court
The US state of Montana delivered a significant judgement this past week as it ruled the state’s Environment Protection Act unconstitutional for not considering the climate impacts of fossil fuel projects. The case, filed by a group of minors, spent three years in the courts before the verdict was delivered. The verdict sets an important precedent for several such cases that are being argued nationwide.
Oil and gas companies suffer biggest losses in exit from Russia
Despite being aided by high oil and gas prices over the past two years, the exit from Russian interests deeply dented the oil industry’s bottom line, an analysis by the Financial Times has revealed. According to the report, losses incurred by the oil industry accounted for about 40% of the total losses that were incurred as a result of exiting business in Russia in the aftermath of its “special military operation” in Ukraine. While the industry is reported to have suffered a cumulative loss of $44 billion, BP is by far the largest loser after exiting its stake in Rosneft which accounted for around 50% of BP’s total oil and gas reserves and a third of its oil and gas production
