India is unlikely to sign a deal with richer nations this year for a just energy transition, as international funding rests on India committing to a timeline to phase out coal, an “unviable” proposition for the country, energy analysts said.
The Group of Seven (G7) industrialised nations, together with Norway, Denmark and the European Union, believe a ‘just energy transition partnership’ (JETP) with India will financially empower it to reduce climate-changing emissions from power production.
Similar pacts have been signed with South Africa, Indonesia and Vietnam, but India wants a JETP on its own terms: no phase-out of coal and funds for clean energy expansion in the form of grants, not loans.
“The developed world is pushing for a JETP as they want coal out. The JETPs with South Africa and Indonesia are all about coal. But that won’t work here,” said economist Vaibhav Chaturvedi, a fellow at the New Delhi-based Council on Energy, Environment and Water (CEEW).
“Coal is the only stable source of energy in India, which is still a developing economy. India won’t talk about coal but (instead about) more renewable energy, which has more achievable and demonstrable targets,” Chaturvedi said in an interview.
India’s ministry of external affairs, which is considering JETP proposals this year as India helms the G20 presidency, did not respond to queries despite repeated emails and phone calls.
But analysts familiar with India’s stance said conversation around a JETP is stuck on the financial terms of funding and India’s resistance to being “bullied into a partnership”.
The just transition conversation is dominated by technical and financial issues, ignoring the social aspect of transition, which is the most important.
D.D. Ramanandan, general secretary, All India Coal Workers Federation
What India needs is more green jobs and funds to train people for them, said Swati Dsouza, an energy analyst with the Institute for Energy Economics and Financial Analysis.
“The JETP as it currently stands may not be the best model or framework for India given that the country will see an increase in energy demand and possible increase in coal capacity,” she said.
In recent months, India has relaxed environmental and public consultations on coal mine expansions, boosted its coal production and cited coal as critical for energy security in global climate dialogues.
But the country still aims to reduce coal from 50 per cent of its energy mix currently to about 30 per cent by 2030, while building 500 gigawatts (GW) of new renewable capacity.
Simultaneously beefing up both coal and renewables points to a messy energy transition for India, including the risk of job losses if some coal mines are abandoned.
India’s mixed signals, analysts say, indicate the country will phase out coal only when it is sure the transition won’t cause power disruptions, with renewable energy storage capacity currently still weak and expensive.
As the world’s third largest power consumer, India’s power use has doubled since the turn of the century, with over 900 million citizens gaining an electrical connection in less than two decades, according to the International Energy Agency (IEA).
Last year, the country faced one of its worst power crises in six years as a heatwave swept across the nation, pushing up energy demand, triggering power cuts, causing a fuel crisis at overworked power plants and boosting heat-related deaths.
As it tries to meet rising demand for power, coal use will peak in India between 2030 and 2035, the government said - but meantime the country needs to strengthen its renewable grid and infrastructure, for which it wants JETP funding.
“We still want to negotiate with developed countries … as long as developed countries listen to us,” said Santosh Patnaik, program coordinator at Climate Action Network South Asia.