Climate Change, Sustainability & Energy Sector Transition – EQ

Dr. Prashant Khankhoje
Managing Director
A2Z Energies

Britain stopped producing electricity from Coal power plant. The UK announced closure of “Ratcliff-on-Soar” plant with last unit generated on 30th September 2024, after running since 1967. This is Britain’s journey towards fight against climate change. Now the electricity generation is from Wind, Solar, Wave, Nuclear, Natural gas etc.

The first Coal fired power station in the world, the Holborn Viaduct Power station also called as “Edison Electric light station” was built in 1882 in London by the inventor Thomas Edison was also stopped after running for few years due to losses.

India & the world is facing challenges of sustaining its rapid economic growth while dealing with threat of Climate Change. The Climate Change threat is due to the accumulated greenhouse gas emission in the atmosphere generated from intensive Industrial growth and high consumption life style. According to the Intergovernmental Panel on Climate Change (IPCC), anthropogenic greenhouse gas emissions (GHG) are mainly driven by population size, economic activity, lifestyle, energy use, land use patterns, technology. The Temperature rise, unseasonal rains, floods & draught is affecting the utilisation of natural resources and adversely affect the livelihood of people.

India is planning several measures to promote Sustainable processes & Life style.

The Environmental challenges of India are the loss of biodiversity, scarcity of water, air pollution, waste management and conservation of natural resources.

The climate change is caused by humans using oil, gas and coal for their homes, factories and transport. When these fossil fuels burn, they release greenhouse gases – mostly carbon dioxide (CO2). These gases trap the sun’s heat and cause rise in the temperature on earth.

The world is now about 1.2c warmer than it was in the 19th century – and the amount of CO2 in the atmosphere has risen by 50%.

Some of the sustainability challenges in India are:

• Climate change
• Energy consumption
• Wastage
• Threats to public health
• Poverty
• Management of natural resources
• Loss of biodiversity, and
• Land use.

Sustainable technology is the combination of two complementary ideas.

• Technology that is meant to remedy, improve, or offset carbonization, environmental setbacks, or problems.
• Technology that is produced using green or ecologically responsible materials or processes.

With the climate crisis, there is a current movement towards sustainability as a more appealing priority for businesses, as people begin to live more sustainable lives.

It is likely that, in the future, positive impact on climate over the whole value chain, improved impact on the environment, people, and atmosphere, and productive input on society, will be expectations for businesses.

Companies will be held accountable& need to work towards sustainability for all aspects of industry, and any environmental damage or harmful emissions should be limited or removed from productive processes.

In business, sustainability refers to doing business without negatively impacting the environment, community, or society as a whole.

Sustainability in business generally addresses two main categories:

1. The effect business has on the Environment
2. The effect business has on Society

Sustainability is a business approach to creating long-term value by taking into consideration how a given organization operates in the ecological, social, and economic environments. Sustainability is built on the assumption that developing such strategies fosters company longevity.

The term sustainability is broadly used to indicate programs, initiatives and actions aimed at the preservation of a particular resource. However, it actually refers to four distinct areas: human, social, economic and environmental – known as the four pillars of sustainability.

It is also expected that resources will be reused to suit the global increase in population in what is commonly referred to as a ‘circular economy’. This change would allow one person’s waste to be another’s resource, in a process that would greatly reduce waste and create a more efficient supply chain. India and entire world is planning several measures to promote Sustainable processes & Life style.

Sustainable business strategies are unique to each organization as they tie into larger business goals and organizational values. For instance, sustainability in business can mean:

• Using sustainable materials in the manufacturing process
• Optimizing supply chains to reduce greenhouse gas emissions
• Relying on renewable energy sources to power facilities
• Sponsoring education funds for youth in the local community

The essence of sustainable business is in considering the triple bottom line concept, which refers to how a company’s actions impact profit, people, and the planet. With this framework in mind, the company can develop a sustainable business strategy that is profitable.

ESG & SUSTAINABILTY

ESG stands for Environmental, Social, and Governance. ESG is a framework used to assess an organization’s business practices and performance on various sustainability and ethical issues. It also provides a way to measure business risks and opportunities in those areas. Investors are increasingly applying these non-financial factors as part of their analysis process to identify material risks and growth opportunities.

Environmental, social and governance (ESG) refers to a collection of corporate performance evaluation criteria that assess the robustness of a company’s governance mechanisms and its ability to effectively manage its environmental and social impacts. ESG data consists of company’s carbon emissions, water consumption or customer privacy breaches.

SUSTAINABLE DEVELOPMENT GOALS (SDGS)

World leaders agreed to 17 Global Goals (Sustainable Development Goals or SDGs).

The Sustainable Development Goals (SDGs) also known as Global Goals were adopted by the United Nations which aim to transform our world.

SDGs are universal call to action to

• End poverty and inequality,
• Protect the planet, and
• Ensure that all people enjoy health, justice and prosperity.

The 17 SDGs are integrated—they recognize that action in one area will affect outcomes in others, and that development must balance social, economic and environmental sustainability

It is now up to all of us, governments, businesses, civil society and the general public to work together to build a better future for everyone.

BRSR (Business Responsibility and Sustainability Reporting) is a framework designed by SEBI (Securities and Exchange Board of India) to encourage companies to integrate sustainable and responsible business practices into their operations.

Business Responsibility and Sustainability Reporting (BRSR) is a mandatory reporting requirement for all listed entities in India. The BRSR framework aims to encourage listed companies to adopt sustainable business practices and disclose information related to their environmental, social, and governance (ESG) performance.

SUSTAINABILITY MEASURES IN INDIA

National Action Plan on Climate Change

To deal with the challenges of Climate Change, India have developed Eight National Mission keeping in mind the famous dictum “The Earth has enough resources to meet people’s need, but will never have enough to satisfy people’s greed”

Eight National Missions, form the core of the National Action Plan, representing multi-pronged, long term and integrate strategies for achieving key goals in the context of climate change.

These Missions are

1. National Solar Mission,
2. National Mission on Enhanced Energy Efficiency,
3. National Mission on Sustainable Habitat,
4. National Water Mission,
5. National Mission for Sustaining the Himalayan Eco-system,
6. National Mission for a Green India,
7. National Mission for Sustainable Agriculture and
8. National Mission on Strategic Knowledge for Climate Change.

COP26- INDIA’S 5 COMMITMENTS

India has announced its five commitments (AMRIT TATVA) to tackle climate change related issues.

1. By 2030, India will increase its non-fossil capacity to 500 Gigawatts (GW).
2. India will fulfil 50 percent of its energy requirements with renewable energy by 2030.
3. India will reduce one billion ton of the total projected carbon emission between 2021 and 2030.
4. By 2030, India will reduce its economy’s carbon intensity to less than 45 percent.
5. India will achieve the target of net zero emissions by 2070.

Climate change-solution

Mitigation – reducing climate change –

Reduction in the flow of heat-trapping greenhouse gases into the atmosphere either by

1. reducing sources of these gases (for example, the burning of fossil fuels for electricity, heat or transport) or
2. Enhancing the “sinks” that accumulate and store these gases
   (Such as the oceans, forests and soil).

Adaptation – adapting to life in a changing climate –

Adjusting to actual or expected future climate. The goal is to reduce our vulnerability to the harmful effects of climate change (like sea-level encroachment, more intense extreme weather events or food insecurity)

Local adoption –

Cities and municipalities are at the frontline of adaptation. Cities and local communities around the world have been focusing on solving their own climate problems.

Objectives:

• Energy efficiency & management
• Use of renewable energy
• Conserve and protect water resources through efficiency, reuse, and rainwater harnessing;
• Eliminate waste, prevent pollution, and increase recycling
• Design, construct, maintain, and operate high-performance sustainable buildings

ENERGY TRANSITION & WAY FORWARD

Energy/Power is one of the most critical components of infrastructure crucial for economic growth & welfare of industry. The cost of power/Electricity forms major contributor to production cost. It is essential for any industry to devise the strategy on Energy Conservation, explore various options to reduce energy cost.

India’s need to increase energy provision for its population and fast growing economy poses a formidable challenge which is perceived as both a great opportunity as well as a necessity for the country to increase the share of RENEWABLEs in the overall energy mix.

The World is in a transition phase and energy is central to it. India has been responsible for almost 10% of the increase in global energy demand since 2000. India’s energy demand in this period has almost doubled, pushing the country’s share in global demand up to 5.7% in 2013 from 4.4% at the beginning of the century. The primary energy demand in India has grown from about 441 Mtoe in 2000 to about 775 Mtoe in 2013. This demand is expected to increase to about 1250 (estimated by International Energy Agency) to 1500 (estimated in the Integrated Energy Policy Report) million toe in 2030. India’s energy consumption has almost doubled since 2000 and the potential for further rapid growth is enormous. Yet the increase in domestic energy production is far below than India’s consumption needs. By 2040 more than 40% of primary energy supply will be imported, up from 32% in 2013. It may also be noted that no country in the world has been able to achieve a Human Development Index of 0.9 or more without an annual energy supply of at least 4 toe per capita. Consequently, there is a large latent demand for energy services that needs to be fulfilled in order for people to have reasonable incomes and a decent quality of life.

ENERGY Conservation/ Energy Efficiency

Improving the energy efficiency meets the dual objectives of promoting sustainable development and of making the economy competitive. Recognizing the formidable challenges of meeting the energy needs and providing adequate and varied energy of desired quality in a sustainable manner and at reasonable costs, improving efficiency have become important components of energy policy. In addition, the environmental and health burdens arising out of the use of hydrocarbons may also force mankind towards energy efficiency and clean energy systems. Energy Conservation has also assumed enhanced importance with a view to conserve depleting energy resources.

Government of India has undertaken a two pronged approach to cater to the energy demand of its citizens while ensuring minimum growth in CO2 emissions, so that the global emissions do not lead to an irreversible damage to the earth system.

On one hand, in the generation side, the Government is promoting greater use of renewable in the energy mix mainly through solar and wind and at the same time shifting towards supercritical technologies for coal based power plants. On the other side, efforts are being made to efficiently use the energy in the demand side through various innovative policy measures under the overall ambit of Energy Conservation Act 2001.

The Energy Conservation Act (EC Act) was enacted in 2001 with the goal of reducing energy intensity of Indian economy. Bureau of Energy Efficiency (BEE), a statutory body under Ministry of Power is responsible for spearheading the improvement of energy efficiency in the economy through various regulatory and promotional instruments. Bureau of Energy Efficiency (BEE) was set up as the statutory body on 1st March 2002 at the central level to facilitate the implementation of the EC Act.

The Energy Conservation Act mandate:

1. Standards & labelling of equipment and appliances.
2. Energy conservation building codes for commercial buildings
3. Energy consumption norms for energy intensive industries.

Ministry of Power, through Bureau of Energy Efficiency (BEE), has initiated a number of energy efficiency initiatives in the areas of
1. Household lighting
2. Commercial buildings
3. Standards and labelling of appliances
4. Demand side management in agriculture/municipalities, ME’s and large industries
5. ECBC

POWER SECTOR REFORMS

There are various power reforms since 1910.

• The electricity act 1910 was the first act
• The Electricity (Supply) Act 1948
• The Electricity Laws (Amendment) Act of 1991 allowed private entities as IPP
• The Electricity Regulatory Commission Act was enacted in 1998 & thus formation of CERC & SERC was allowed.
• CERC was initially formed on 24th July 1998.
• ELECTRICITY ACT 2003

1. De-licensing of Generation
2. Competitive Bidding
3. Unbundling of SEBs
4. Power Trading
5. Open Access
6. RPO – Renewable power Obligation
7. Private Sector Participation: These developments have given rise to new opportunities for the private sector especially in Power Generation space

MAJOR RE PROGRAMS –INDIA’S INITIATIVE

Government of India has ambitious plans to increase percentage of RE in the energy mix of India.

To achieve India’s target of500 GW by 2030, following programs are introduced;
1. Pradhan Mantri Kisan Urja Suraksha Evam Utthan Mahabhiyan (PM KUSUM)
2. Roof Top Solar (RTS) Programme
3. Renewable Energy Hybrid Projects
4. Waste to Energy
5. Green Energy Open Access
6. Virtual Net Metering
7. Peer to Peer Energy Transaction

Revamped Distribution Sector Scheme – A Reforms based and Results linked Scheme”

A well-functioning electricity infrastructure is essential for the success of a
Modern economy. 24×7 availability of reliable, quality and affordable power is
Key to economic development of the country. Power Sector has witnessed
Tremendous growth over the past five years in generation, transmission and
Universal access to electricity.

Schemes in the Distribution Sector by Government of India
1. Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY);
2. Pradhan Mantri Sahaj Bijli Har Ghar Yojana (SAUBHAGYA)
3. Integrated Power Development Scheme (IPDS).

With this aim to provide 24×7 uninterrupted, quality, reliable and affordable power supply through a financially sustainable and operationally efficient Distribution Sector, the Government of India has approved a Revamped Distribution Sector Scheme- a Reforms-based and Results-linked Scheme with an outlay of Rs.3,03,758 crores over a period of five years from FY 2021-22 to FY 2025-26with the objective to improve the quality, reliability and affordability of power supply to consumers through a financially sustainable and operationally efficient distribution sector.

RDSS Objectives –

1. Reduce the AT&C losses to Pan-India levels of 12-15% by 2024-25.
2. Reduce ACS-ARR gap to zero by 2024-25.
3. Prepaid Smart metering solution
4. Segregation of agriculture feeders, Replacement by AB Cable.
5. Distribution Automation in Urban Areas/SCADA
6. Demand Forecasting, predictive analysis
7. RE Integration
8. Subsidy delivery by Direct Bank Transfer (DBT)
9. Training / Capacity building