The many paths to a greener future

Jayant Sinha and Anshu Bharadwaj note that India is demonstrating a new paradigm in which economic growth does not have to go together with the consumption of fossil fuels and increasing emissions

Researchers and policymakers are exploring various pathways for Indian carbon emissions over time. These pathways range from Business-As-Usual (BAU) to Low-Carbon to Net-Zero. In each pathway, it is becoming increasingly important to establish when carbon emissions for India will peak and then start to decline. 

Climate justice would suggest that India’s peak year can come quite late, since our per capita carbon emissions are very low. However, the later that India’s emissions peak, the more difficult it will be to transition to a greener economy, and the more difficult it will be for us to export our high-carbon products and services.

Essentially, the peaking concept is linked to the theory that a country’s economic development is closely linked to fossil fuel consumption. According to this theory, in its initial development stages, a country grows by using cheap fossil fuels, which then also leads to a rapid increase in its global greenhouse gas (GHG) emissions. As the country’s economy becomes more developed, emissions peak, and the country’s carbon requirement for each unit of GDP begins to decline rapidly. This model has been followed by all industrialised countries, including China.

The US peaked at 15 tonnes per capita, Japan at 10 tonnes and China at 7 tonnes per capita. In comparison, India’s present GHG emissions are about 3.5 billion tonnes CO2 equivalent, which translates to just 2.5 tonnes per capita. Since climate equity would suggest that India has ample headroom to increase carbon emissions, when will India peak and at what level before decarbonisation begins to happen?

Today’s global GHG emissions are about 55 billion tonnes CO2 equivalent. The Intergovernmental Panel on Climate Change has concluded that global emissions must reach close to zero by 2050 for us to have a reasonable probability of restricting warming to 1.5 °C above pre-industrial levels. This implies that India’s total GHG emissions should also reach zero by mid-century. Let us examine a few pathways for reaching there. 

In the BAU pathway, our emissions continue to grow with increasing usage of fossil fuels till we reach middle income status of about $8,000 to $10,000 in GDP per capita. Former prime minister Manmohan Singh had pledged that India will never exceed the per capita emissions of industrialised nations. Several studies have indicated that on this BAU pathway, even by 2050, India will still only reach about 5 tonnes per capita. So, if we want to achieve per capita emission standards close to those of industrialised countries (or even China), then our BAU emissions will continue to increase and peak around 2070. Subsequently, carbon emissions will begin declining and reach zero by the end of the century.  On the BAU pathway, India will be emitting about 15 to 20 billion tonnes in 2070. While this does represent an “equitable” solution from the perspective of using carbon space, it will likely aggravate global warming and will not be acceptable at the global level. Ironically, India will end up facing some of the harshest consequences of global warming. 

What if we peak around 2050 at 5 tonnes per capita, as suggested by some studies? On this Low-Carbon pathway, India would be still emitting about 8 billion tonnes of GHG when the rest of the world will be close to net-zero. This too may not be acceptable to the global community and will seriously jeopardise the 1.5 °C goal. 

The Net-Zero pathway would require that our emissions peak before 2050 and reach zero thereafter — maybe 10 to 20 years later. The exact time frames should come from careful modelling and analyses. This would roughly parallel what China is promising to do.  

Two points emerge from the above analysis. One, it is possible that our emissions will peak at about 3 to 5 tonnes per capita. This is well below the lofty peaks reached by developed countries. In fact, we may not even peak and then rapidly decline, rather we may reach a plateau and then slowly decline from there on.  

Second, and more importantly, it raises the fundamental question: Does this lower per capita level imply that we have compromised on job creation and economic prosperity? Will we not be able to take advantage of cheap fossil fuels?

Conventional economic theory suggests that economic growth and development are directly coupled to the consumption of cheap fossil fuels. In India’s case, there is sufficient empirical evidence to show that we have reduced our carbon intensity because we have been progressively reducing our usage of fossil fuels. This is mainly because of the adoption of policies for energy efficiency and renewables over the last 15 years. India has already built a low-carbon economy. In fact, India is demonstrating a new paradigm, in which economic growth does not have to go together with the consumption of fossil fuels and increasing emissions.

Since all these different pathways are possible for India over the next few decades, it is vitally important that we examine them through detailed analytical studies and extensive consultations with stakeholders. While we do have ample time to make the necessary changes to our economy, we must begin now to decide which pathway we would like to pursue. Each pathway requires different policy packages and sets up different investment and consumption incentives. These policy packages will impact the long-lived asset decisions that we are making currently and will shape our competitiveness in the coming decades. 

Sinha is the chairman of the Standing Committee on Finance in Parliament and a Lok Sabha MP from Hazaribagh, Jharkhand. Bharadwaj is the CEO of the Shakti Foundation. Views are personal