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Economic Considerations - A
Developing Country Perspective
Equity and Global Climate Change
April 17-18, 2001
Pew Center on Global Climate Change
Washington D.C.
Sujata Gupta
Tata Energy Research Institute
Outline
• International perspective
• Initiatives in India
• Future strategy
Per capita energy consumption (kgoe), 1998
10000
8000
6000
4000
2000
Coal
Oil
ld
W
or
A
si
a
ic
a
A
m
er
N
hi
na
C
In
di
a
U
S
0
Total
Per Capita Carbon Emissions & Income
Carbon Emissions/Capita (tons)
14.00
Qatar
12.00
10.00
United Arab
Emirates
8.00
Bahrain
6.00
Singapore
United States
Australia
4.00
Saudi Arabia
Czech Republic
Luxembourg
Norway
Canada
Japan
2.00
Switzerland
Hong Kong, China
0.00
0
5,000
10,000
15,000
20,000
GDP/Capita (PPP$)
25,000
30,000
35,000
Energy consumption (mtoe), 1997
3500
Oil
Gas
Coal
3000
2500
2000
1500
1000
500
0
US
India
China
OECD
Asia
World
Total & per capita energy related CO2 (1996)
30000
20.1
23882
Tonnes of CO2 per capita
20.0
25000
20000
15.0
15000
11.1
9.4
10.0
10000
5.0
5301
4.0
0.9
997
861
5000
1168
0.0
0
US
Source: IEA & WRI
India
tCO2/capita
Germany
Japan
Total emissions
World
Million tonnes of CO2
25.0
CO2 equivalent (tonnes) pca
Per capita CO2 emissions
35
32.2
30
25
20.4
20
14.2
15
9
10
5
6.1
1.1
2.2
0
India (1990) India (2020)
Australia
(1990)
Germany
(1990)
Japan
(1990)
USA (1990)
World
(1990)
Where would we stand?
Income (1990
US$)
India 2020
World 1990/ ‘91
1080
4200
Per capita
460 - 485
emissions (kgC)
Japan - 2400
USA - 5400
Main issues
• Call for “meaningful participation” by
major DCs made by the US
• Globally, broad recognition of adverse
impacts of climate change - commitment
to take action
• Several Annex B negotiators at COP-6
recognized that in the long run, equity
pivoted on a per capita basis, is essential
 convergence
National Development Objectives
•
•
•
•
•
•
•
•
•
•
Poverty removal/employment generation
Food sufficiency/self-reliance
Drinking water, primary health etc,
Containing population growth
Efficiency/long-term sustainability
Technology development/Renewable Energy
Power development
Public transport
Higher industrial competitiveness
Sustainable forestry
Energy Reserves
Reserves
India
R/P ratio
World
India
World
Coal (bt)
70.0
1032
212
219
Crude
oil (bt)
Natural
gas
(tcm)
0.6
141
16
41
0.5
145
23
64
Energy sector characteristics
• Persistent shortages
– demand > supply
• High import dependence - oil, BOP
pressures
• Poor productivity/efficiency
• Poor internal rate of return
• Limited energy alternatives for poor
• Subsidies
Reforms and the environment
•
•
•
•
•
•
•
Promotion of RETs
Incentives to efficiency improvements
Waste recycling / cogeneration
Clean coal technologies
Coal washing and fly-ash handling
Dismantling of the APM / Re-structuring
Decentralization of environmental
clearances
Ongoing Initiatives
• Energy sector reforms
– deregulation of the administered price
mechanism - power, oil & coal (removal of
subsidies)  market based pricing
– private sector participation - power, oil &
coal
• Renewable energy programmes
• Sector level reforms
• Regional co-operation in energy
Ongoing Initiatives
• Bagasse-based cogeneration – subsidies
on state of the art technology & soft
loans for modernization
• Biomass combustion – MNES provides a
one-time subsidy of up to 30% of the
project cost
• Grid-connected solar photovoltaic (PV)
applications – two-third of the total
project cost s.t. maximum of 20 million
rupees per 100 kWp capacity
Ongoing Initiatives
• Wind battery chargers – MNES has been
subsidizing small aerogenerators for
more than a decade
• Wind pumps –MNES provides subsidies
of 40-50% of the total cost
• 9th Five Year Plan - Government
recognizes the need to shift from capital
subsidies for RETs to interest subsidies,
& gradually phase out subsidies to move
towards private entrepreneurship
Future strategy
• Support the Kyoto Protocol
– step in the right direction
• Continue with the ongoing program for
“meaningful participation”
• Participation in CDM projects
– Enthusiastic business partners
– Change in government’s reserved attitude
• Local benefits
• Developmental objectives
• Technological upgradation/advancement
Future strategy
• Assess impacts of and vulnerability to
climate change  adaptation measures
• Exploit the synergy between local and
global environmental issues with clear
priority to local
• Longer term perspective
Thank you!