 "(From left) Vivek Dewangan, chairman & MD of REC; Sunita Narain, director general at Centre for Science and Environment; Ulka Kelkar, executive director of Climate at WRI India; and Derek M Shah, senior V-P & head (green energy business), Larsen & To")
India’s vast informal sector, encompassing nearly 440 million workers in agriculture, construction, and micro, small, and medium enterprises (MSMEs) is under significant threat from climate change, a panel of experts warned at the Business Standard Manthan event on Thursday.
The impacts of climate change, such as erratic rainfall patterns, extreme weather events, and rising temperatures, pose a major challenge to their livelihoods. “People working in the unorganised sector — agriculture, construction, and MSME — are highly vulnerable to climate risks,” said Ulka Kelkar, executive director, Climate, WRI India.
The panel emphasised that India experiences one extreme event every day, resulting in the loss of development opportunities. Kelkar also highlighted that even new energy infrastructure could be jeopardised by the impacts of climate change.
Sunita Narain, director general, Centre for Science and Environment, said India is standing at a crucial juncture and it is imperative to adapt to rapid economic growth along with addressing the vulnerability to environmental issues.
While discussing financing in the renewable energy sector, the panel noted that while Indian industry is increasingly acknowledging the necessity of transitioning towards green initiatives, financing is still a sticking point.
Vivek Dewangan, chairman & managing director of REC Ltd, said the real challenge lies in the cost of financing. He emphasised the importance of policymakers and multilateral development banks collaborating to collectively address this challenge and lower the costs associated with energy transition initiatives.
Ground level transformation
Kelkar said that while certain states have made strides in energy transformation, others require support to address their geographical obstacles. States like Bihar and Jharkhand are particularly vulnerable to climate change and face challenges in generating renewable energy. Consequently, they may eventually need to procure renewable energy from neighbouring states, potentially placing them at a disadvantage and necessitating additional assistance.
New green jobs that will be created every year with the adoption of renewable energy won’t match up to the number of young people entering the labour market… but with the new workforce entering the job market every year is higher than the new jobs that will be created, it will become a problem,” said Kelkar.
“As fossil fuels taper off, the tax revenue will also come down. A loss of $1.5 trillion till 2047 unless we seek new ways of generating revenue from green energies,” she said.
More money in green
Highlighting the devising of new avenues for revenue generation, Kelkar said: “A significant portion of our country’s tax revenue currently stems from taxing fossil fuels. As these fuels gradually diminish, so too will the government’s revenue from these taxes. Looking ahead to our aspirations for 2047, there’s a need for approximately $2-2.5 trillion in additional capital investment across various new sectors.”
On whether choosing greener options makes the economy richer, Narain said: “Indian industry is getting far more aware about the need to transform which is not just good for them but also for the environment. But the scale needs to happen in hard to abate sectors like steel, cement. Green hydrogen can play a role.”
Derek M Shah, senior vice-president & head-green energy business, Larsen & Toubro, said states which had a lead in announcing green hydrogen policies have attracted investments. “While the states will lay the policies, the industries will also be attracted to demand centres,” he said.
Talking about the work L&T is doing in the green fuels segment, Shah said: “We are one of the first movers to get a licence to manufacture electrolyser in India. We have already rolled out the first electrolyser. In the initial stage it is going to be 300 megawatt per year. It is going to be 1 Gw capacity per year. We are also trying to bring in our effort in manufacturing top end, highly efficient low-cost manufacturers. It is important that we also get similar support by making sure we don’t have to look at non-compete fields with Chinese electrolysers coming into this space.”
