COP27: Five Issues On India's Radar

At the conference, India will, among other things, push for a just transition deal--which means ensuring energy for a developing country and protecting its workforce employed in fossil-fuel related industries--as it moves to renewable sources of energy, climate finance for adaptation, mitigation and financial assistance for climate change-induced loss and damage.

In addition, Prime Minister Narendra Modi is likely to use India's 'lifestyle for environment' or LiFE mission, which refers to adopting a sustainable lifestyle, to position the country as going beyond policy-making as it advocates for individual and community-level change to help the global fight against climate change.

Climate change negotiations are not just a diplomatic exercise for India; the country is experiencing the adverse effects of climate change every year with a 55% increase in heat-related deaths between 2000-2004 and 2017-2021, and income loss equivalent to 5.4% of its gross domestic product (GDP) due to extreme heat, an emailed press release on research published by The Lancet said. India had extreme weather events on 242 of the 273 days between January 1 and September 30, 2022.

Domestically, India has set its own ambitious climate pledges, known as Nationally Determined Contributions (NDCs) and a net-zero goal (carbon neutrality, referring to all carbon emissions either being eliminated or absorbed and not released into the environment) for 2070, but it also needs external financial help for its people to adapt to the effects of global warming and to mitigate losses.

Lifestyle to combat climate change

The Indian government is pushing Mission LiFE, a belief that apart from policy interventions at a government level, individuals and communities, by changing their behaviour to reduce carbon emissions, can lend a hand in the fight against climate change.

The movement was launched in October 2022 by PM Narendra Modi along with United Nations Chief Antonio Gueterres. Not only is LiFE being promoted at COP27, it has also officially been made part of India's NDC and might also be on its agenda for India's presidency at G20.

G20 or the group of 20 is an intergovernmental platform comprising 19 countries and the European Union that works to address issues like climate change, the global economy and financial stability. India will hold the G20 presidency from December 1, 2022 to November 30, 2023.

LiFE's three-pronged strategy includes nudging individuals to practise simple yet effective environment-friendly actions in their daily lives (demand), such as using public transport and choosing sustainable products like cloth bags over plastic; enabling industries and markets to respond swiftly to the reducing demand (supply) for environmentally unsustainable products like disposable/single-use products and packaging; and to influence government and industrial policy to support both sustainable consumption and production (policy).

"LiFE is a positive effort but it comes with certain caveats," said Avantika Goswami, a programme manager for climate change at the New Delhi-based research organisation, the Centre for Science and Environment (CSE). "The IPCC report identifies what impact behavioural change can have on emissions reduction. But I believe that this should apply to wealthy individuals and countries who have extremely high per capita emissions."

India's per capita emissions, at 2.4 tonne carbon dioxide equivalent (tCO2e), are far below the world average, at 6.3 tCO2e, in 2020, noted the 2022 Emissions Gap report by the United Nations Environment Programme. The US, on the other hand, stands at 14 tCO2e, almost six times India's per capita emissions.

"The IPCC report also states that individual behavioural change is insufficient for climate change mitigation unless embedded in structural and cultural change. So it requires enabling infrastructure to help individuals make the right low-carbon choices," such as better footpaths or first and last mile connectivity to promote walking or use of public transport, added Goswami. "There can also be the danger of shifting of accountability [to citizens] because what then are our larger entities, authorities doing?"

Carbon markets

A carbon market allows countries and companies, that are unable to meet emissions targets, to buy carbon credits from those that have reduced emissions and have 'credits' for sale. For instance, from 2002 to 2012, Indian companies and the government together had earned hundreds of crores worth of carbon credits under the Clean Development Mechanism (CDM)--what carbon markets under the Kyoto Protocol were known as–by reducing industrial emissions, switching to renewable energy, energy efficiency in households and protecting forests, and sold some of them as credits to countries or companies that were likely to exceed their emission targets.

Ahead of COP27, in August 2022, the lower house of the Indian Parliament passed the Energy Conservation (Amendment) Bill, which if enacted will empower the union government to launch a National Carbon Market to trade credits domestically.

Carbon markets have been one of the most debated topics in UNFCCC negotiations because of concerns over double counting of the traded emissions by buying and selling countries, human rights abuses in, and falsifying claims about, reducing emissions under the carbon market mechanism under the Kyoto protocol that preceded the Paris agreement.

It was also on the agenda at COP26, specifically Article 6 of the Paris agreement, which focuses on setting up market mechanisms to meet nationally determined goals of countries.

"For the European Union, the international carbon markets are instruments of decarbonisation, but for developing nations it is an instrument of climate finance," says Vaibhav Chaturvedi of the Council for Energy, Environment and Water (CEEW).

Many of the key issues in the Article 6 Rulebook were resolved at COP26 last year (such as rules on transferring mitigation credits between countries and rules on incentivising the private sector), noted Aman Srivastava, fellow at the New Delhi based think-tank Centre for Policy Research (CPR). Lingering issues include how to transition CDM credits to the carbon market mechanism under the Paris agreement, he said, adding that discussions will also focus on "how countries can make national arrangements to participate in Article 6".

Moving away from fossil fuels through a just transition

The Russian invasion of Ukraine added a layer of complexity to global efforts to cut fossil fuel, and specifically coal, consumption. Russia has been by far the world's largest exporter of fossil fuels, especially to the European countries. As European countries imposed sanctions, Russia curtailed supply of natural gas to Europe. Many were pushed back into reliance over oil and coal for energy.

To meet its growing energy requirement and shortage of domestic coal, India imported coal earlier this year. The UNEP report had also stated that India's coal emissions in 2021 exceeded pre-pandemic levels.

At the 21st Conference of Parties in Paris in 2015, the world had aimed to limit global warming well below 2°C, preferably to 1.5°C, as a temperature increase beyond this limit would mean more frequent and intense climate-related risks like heat waves and floods. But the world is not on track to achieve this aim, according to the UNEP 2022 Emissions Gap report. New and updated pledges submitted by countries will only reduce 10% of greenhouse gas emissions by 2030, when a 45% reduction is required.

As part of its pledge, India too had committed to reducing the emissions intensity of its Gross Domestic Product (GDP) by 45% by 2030, from 2005 levels. It has also pledged to have about 50% of installed electric power from non-fossil fuel-based energy resources by 2030.

"We are on track to reduce the emissions intensity of our economy as per our target. But domestically, we could show higher ambition by having non-fossil fuel generation targets instead of capacity targets," said Goswami of CSE. Installed capacity refers to what an entity is capable of producing and the actual generation, or what that entity achieves, may differ drastically. At the moment, India's installed capacity of fossil fuel sources (coal, lignite, gas and diesel) stands at 57.9%, and of non-fossil fuels stands at 42.1% However, if we look at actual generation, coal still dominates our power generation while renewable energy is at 26%.

India had toned down its ambitions for non fossil-fuel based energy of 500 GW by 2030 that PM Modi had announced at COP26, to reach 50% (407 GW) of its estimated electricity demand of 817 megawatt in 2030, when India's official climate pledges were sanctioned by the Union cabinet.

In addition, at COP26, India insisted on a "phase-down" of coal use rather than "phase-out", because unlike developed nations, India's energy needs are not yet met. Even though India builds clean energy infrastructure, the existing fossil fuel capacity cannot be simply phased out or substituted.

At COP27, India will push for climate finance to achieve this phase down in coal. A June 2022 report by BloombergNEF stated that India will require a $223 billion investment between 2022-2029 to meet the wind and solar capacity under the updated NDCs.

The G7 countries, which includes Germany, Italy, Canada, France, Japan, UK and the US declared in June 2022 that they will launch a Just Energy Transition Partnership (JETP) with India, South Africa, Indonesia, Senegal, Argentina at COP27. The partnership aims to reduce dependency on coal and finance the rapid deployment of clean energy in India, and experts say we will know more about the partnership at COP27.

Transparency, accountability and scaling up of climate finance

The issue of financial help to cut emissions and adapt to the effects of climate change for developing countries will be at the top of the agenda at COP27. India has announced its intention to raise the issue of finance and stated that countries must agree on the definition of climate finance.

Tracking climate finance is difficult because there is no clear definition on what counts as climate finance. The UNFCCC's operational definition, that "climate finance aims at reducing emissions and enhancing sinks of greenhouse gases and aims at reducing the vulnerability of, and maintaining and increasing the resilience of, human and ecological systems to negative climate change impacts," is too broad and leaves room for ambiguity, according to a 2022 study by Anis Choudhary and Jomo Kwame Sundaram.

The two other issues with climate finance are its scale and its delivery, experts told us.

In 2009, developed countries had pledged to deliver to developing countries an annual climate fund of $100 billion per year by 2020 for funding climate adaptation and mitigation measures.

Between 2013 and 2019, only 65% of the finance was delivered on average by developed nations to developing nations. The target was then deferred by three years to 2023. According to the Adaptation Gap 2022 report released by the United Nations Environment Programme on November 3, the combined adaptation and mitigation finance in 2020 fell short by at least $17 billion of the $100 billion.

Further, the $100 billion promise is now inadequate because developing countries are estimated to need $600 billion a year from 2020 to 2050 to decarbonise just their energy sectors.

At COP26, Prime Minister Modi demanded $1 trillion in finance from developed countries. The African group of countries also called for a $1.3 trillion a year in climate finance to be made available from 2025.

"The debate at COP27 will not just be about numbers but that some action should happen," said Chaturvedi of CEEW. "Finance should start flowing in. Private finance and low-cost finance should also come in."

Reparations for loss and damage

A subset of climate finance, loss and damage finance is one of the other issues which will be at the centre of developing nation's attention at COP27, according to an official press release from the Indian environment ministry. 'Loss and Damage' reflects the impact of changing weather on communities due to climate change, which cannot be avoided by undertaking measures to reduce greenhouse gas (termed as mitigation) or adjusting to climate change impacts (termed as adaptation), according to several studies.

India is one of the most vulnerable countries to the effects of climate change, with the poor being the most at risk. For instance, unseasonal rains and extreme weather events are culminating in heavy loss for farmers and fishers from Maharashtra, IndiaSpend had reported in October 2022, and loss and damage finance can help compensate for these losses.

The demand for finance to cover loss and damage by developing countries has been a long-standing one. At COP26, there was some progress when the group of developing countries known as the G77, and China, called for a formal 'loss and damage finance facility' to be set up to provide financial support to vulnerable nations. However, due to opposition from the developed countries, such as the EU, US and UK, leaders failed to establish a relief fund to help developing countries deal with climate change-related loss and damage.

"The disproportionate impact of climate change calls for mainstreaming loss and damage into action and should be an important component of the (COP27) negotiations," said Abinash Mohanty, a public policy expert in climate risks and adaptation, and a reviewer of the IPCC's sixth assessment report on the impacts of climate change.

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