The webinar was held by EQ Magazine Pro on March 28, 2022, powered by EnKing International on the topic ‘Transition to net zero: The role of green finance and carbon market’.
In this webinar, Samrat Sengupta, GM, Sales, EKI Energy Services Limited put his views on topics related to net-zero, green finance and carbon market.
Samrat Sengupta gave a brief and proud introduction of Enking International. He said, “From a very small local startup that has developed MNC operations with more than 18 countries of officials and more than 40 countries of clientele internationally. We are a leading developer and supplier of carbon credits in the world with a passionate team of committed professionals working in the realm of ‘climate change, carbon credit and sustainability solutions’. Our comprehensive bouquet of offerings include end-to-end solutions for a sustainable roadmap that enable companies to achieve their climate goals and ambitions. Also, we are the world’s first and only public listed company in the carbon market which provide end-to-end carbon credit management, carbon footprint management, sustainability audits, training for quality control and management amongst other services. We serve 2500+ clients across 40 countries and have traded more than 150 million credits as on date.”
Talking about anthropogenic climate change, he said, “The scientific world understands that paleoclimatic temperature change is a normal phenomena in the climatic history of this planet but worrying factor is that,1850 onwards, look at the industrial revolution, the temperature change has drastically increased many folds. This ecology has its own way to react to any change in the global environment which is happening. The gradient which is now the particularly the temperature change global warming and its related further impact on the global environment is so drastic that various ecological parameters are not getting to able to adjust itself and we are experiencing loss of spaces even lot of human population who are vulnerable, who are at the marginal part of the society, who are geographically in a more vulnerable position has a chance of getting impacted. World’s annual carbon dioxide emissions have grown about 70 times since the pre industrial era reaching nearly 36.4 gigatonnes in 2019. Unless, we bring them town to 18.22 gigatonnes by 2030 we are headed for catastrophic climate events.”
Talking about annual emission of carbon dioxide from fossil fuel, he said, “Moving to the historical footprint of global warming or greenhouse gas emission, post 2020 China has become the largest emitter followed by the European Union, US and North America. In historical science if we calculate the area, the United States has the largest share of consuming the global space of the carbon budget followed by European Union and China but considerably, India as well as Africa each of which are holding 17% of the world population has a footprint of around 7% to 9% for India and less than 5% for Africa. Even in that pollution space due to the irresponsible or equal development is getting reflected.”
Mr. Sengupta gave a few reasons for the environmental catastrophe. He said, “This world is in a global environmental catastrophe in the form of climate change. Soon, it will happen in the form of other states because from the time frame of industrial development the economic development indicator is solely dependent on the financial parameters which have not historically been able to internalise any of the value and is associated with the cost of environmental services.
We are using environmental resources to meet our growth but we are not able to value that environmental services into our pricing mechanism and this leads us to inefficient capital growth models that completely undermine the carrying capacity of this planet. We are exploiting its natural resources and fossil fuels. We are extracting fossil fuel as a natural resource. We are not able to macroeconomically capture the cost of those extraction into the pricing of the product. Anything and everything we do as a human being in our process of development and this leads to the imbalance.
Even in the present scenario, our government doesn’t have a clause of sustainable, environment friendly, disposal of the solar panels and the whole power set up which has a life span of approximately 20-25 years post completion of that technical lifetime. As an environmentalist I am worried that at the end of the life of the solar plants what we will do with the whole structures. If we are not able to recycle it or dispose of it scientifically and environmentally friendly, we are just going to damage the topsoil of that land portion which will not be able to do any kind of services in future due to contamination of heavy metal.”
He further talked about the evolution of ‘net zero’. He said, “The concept of Net Zero has traversed a long way in a very short time; Science to Policy to Mainstream in almost half a decade. It is seen for the very first time that a concept has been in practice from laboratory to actual action in such a short time period. It started with the IPCC Fifth Assessment Report (2013) states, limiting global temperature rise is possible by limiting cumulative stock of CO₂ into the atmosphere (Carbon Budget). Article 4.1 of Parish Agreement stipulates Countries to peak their annual emission at the earliest implies to reduce their absolute emission as quickly as possible, to achieve a balance of between anthropogenic emissions by source and absorption by sinks of greenhouse gas by mid of this century.
Also, IPCC’s special report of 1.5°C concludes that if the world misses to arrive at ‘Net Zero’ by 2050 high probability of global average temperature will rise over 1.5°C, whose effects will be devastating. As on date Net Zero pledges cover almost 68% of the world to mainstream in almost half a economy. Also, the inclusion criteria for net-zero commitments may vary from country to country. Forr example, the inclusion of international aviation emissions or the acceptance of carbon offsets.
Mr Sengupta told about India’s five commitments which were announced at 26th Conference of the Parties in Glasgow in November 2021. First is the landmark net-zero commitment by 2070. Second is reducing total projected carbon emissions by One billion tones by 2030. Third is increasing non-fossil energy capacity to 500 Gigawatts by 2030. Fourth is fulfilling 50 percent of energy requirements from renewable sources by 2030. Fifth is to reduce the carbon intensity of the economy by 45 per cent by 2030.
Talkin about the pros and cons of net-zero, he said, “This concept has an inherent problem. It’s a futuristic target and that’s what creates undermining the requirement of immediate action. That’s one huge problem. The United Nations framework convention on climate change was based on a common but differentiated responsibility but the largest emitter should have taken much steeper commitment than the scientific average of the globe of 2050 in net-zero. So, limiting the carbon budget of the space for development for people in the southern countries and developing countries to attain a minimum standard of living. So, this inequality has not been addressed, how the scientific communication of net zero by mid of this century get into action in policies and politics without changing the inequality or without addressing the equality need.
The Global North is objectively producing more carbon dioxide and plastic waste then the Global South in terms of excess global carbon emission, the United States is responsible for 40% of it and the EU for 29%. In total, the Global North is responsible for 92% of emissions. The US, UK, EU, Russia, Japan, Australia, Canada and China will occupy 62% of the carbon budget. The remaining world, with 66% of the population, will be left with 38%.”
Talking about the good part, he said, “It’s not all rosy but at least all levels of stakeholders from policy makers to civil society representatives to business houses to the financial institutions are talking about taking actions at their end. After four decades of sweet-nothing in 2020 and 2021, we are trying to get into action. We need a greater push, only 27 out of the largest 250 corporate emitters have laid out long term plans with short term targets. It is critical that business businesses set net-zero targets and for everyone to be confident about how they will achieve it. Companies should take up the targets which are real, measurable and verifiable. These should be science based targets in cutting emissions”.
Talking about energy transition, he said, “Net-zero requires an immediate and abrupt shift from coal and petroleum to renewable and carbon neutral energy sources. Historically, we are hostage to end-use technologies suitable for concentrated energy, fossil fuel, and sources. And, to meet the challenge of abrupt transition to renewable energy sources, electricity is the most suitable medium or the bridging technology. So, there are global efforts towards electrification of the end use of energy which is holding the success rate of transition from petro-economy. But in this gung-ho of electrification and RE we should not overlook the environmental and material balance attributes, else by the mid of this century we will create e-waste and mineral shortage jeopardizing our growth engine.”
Mr Sengupta talked about green finance. He said, “Green finance is any structured financial activity that has been created to ensure a better environmental outcome. It has able to address the lacunae of internalization of environmental cost and risk in traditional financial activity. It is able to create positive risk mitigation factors and channelise traditional finance to novel technology adoption. The value of green bonds traded could soon hit $2.36 trillion. The European Central Bank is getting heavily involved in green finance. The top three green bond issuers are US, China and France. Typical projects that fall under the green finance umbrella include renewable energy and energy efficiency, pollution prevention and control, biodiversity conservation, circular economy initiative, sustainable use of natural resources and land.”
To get the net-zero, he suggested, “We should be recognising the ‘carbon market’ as one of the best possible tools to internalise carbon in our daily decision making. We should be aggressively working towards attaining the best by setting up regulatory mechanism at national and multilateral levels and by improving the voluntary market with best transparency.”
