COP26 concluded in the second week of November on a high note to drive global climate actions and 195 countries set a target to keep average global temperature change below 2°C and as close as possible to 1.5°C. Before the summit, the planet was on course for a dangerous 2.7°C of global warming. Based on new announcements made during the summit, experts estimate we are now on a path to between 1.8°C and 2.4°C of warming.
Important headway was made in many areas and a few examples of the outcomes of the conference are: The Adaptation Fund reached $356 million, which is almost three times its mobilisation target for 2022; the LDCF, which supports climate change adaptation in the world’s least developed countries, also received a record $413 million in new contributions; with respect to International Carbon Markets, after five years of negotiations, the world’s governments settled on the rules for the global carbon market under the Paris Agreement’s Article 6; countries were encouraged to align the Nationally Determined Contribution (NDC) targets’ dates around five-year cycles, which will hopefully help spur ambition and action in the near term, facilitate better understanding of global progress, ensure action over the same time period and keep pace with the Paris Agreement’s five-year cycle.
At COP26, India modified its NDCs for 2030 and Prime Minister Narendra Modi committed that the country will achieve net-zero emissions by 2070. This was one of the five major commitments or panchamrit he made on behalf of India to mitigate climate change. We welcome this and are extremely happy that a date for net-zero has been set. Worth noting are the powerful and ambitious targets for the near term (by 2030) that were adopted—India will bring its non-fossil energy capacity to 500 GW, carbon intensity down to 45%, fulfil 50% of its energy requirement through renewable energy and reduce 1 billion tonnes of carbon emissions from the total projected emissions. With successful implementation of many initiatives already underway in India, the fourth largest renewable energy hub is well on track to achieve the aspirational targets.
The message from the PM is clear—that the goals of climate action demand universal strategies from all nations and India’s growth path must increasingly include sustainability as a concomitant objective. In this context, Indian industry is making significant progress in the climate mitigation mission and views the PM’s commitment as an opportunity to inculcate sustainability actions across its operations, goods and services. Sixty one Indian businesses have made commitments towards net-zero carbon and are developing strategies to reach this goal. These include businesses from across sectors. A number of Indian companies in partnership with CII have also committed to achieving no net loss on biodiversity, addressing air pollution and working towards a circular economy, with some even committing to removal of commodity-driven deforestation in supply chains.
Under the PM’s visionary strategies for renewable energy, hydrogen mission, reduction of carbon emissions, etc., India has attained great results in solar and wind energy, railways (committed to net zero by 2030) and LED lights among others.
On a positive note, India has taken the lead and is at the forefront of action against climate change. In fact, it has retained its spot in the top 10 best performing countries for the third year in a row in the Global Climate Change Performance Index (CCPI), released by Germanwatch on the sidelines of COP26. With India on the road to meeting its NDCs, the stretch targets set by the PM can be achieved if we all pull together as one.
Achieving net zero involves technology pathways as well as financial flows of investments towards the construction of the associated physical infrastructure. Based on the primary analysis to meet net zero by 2070, India will require a cumulative investment of $10.1 trillion in power sector transformation in scaling up generation from renewable energy, associated integration distribution, transmission infrastructure and setting up green hydrogen production. Finance was extensively discussed throughout at COP26 and there was consensus on the need to continue increasing support to developing countries.
COP26 fell short on the expectations with respect to technology transfer and finance. The pledge to mobilise $100 billion a year has not been realised, which means climate action will be delayed further till 2025.
While Indian industry is making rapid progress in the arena of climate mitigation, we look forward to a partnership with the government in terms of mechanisms to reward or incentivise early action. This will help motivate companies/organisations to accelerate efforts on climate actions as well as bring more into the fray. The converse would be to impose some kind of penalties on inaction, which would be a definite deterrent. This would emphasise the government’s intent on achieving the commitments made at COP26 and accord seriousness to the magnitude of the current situation. Government cooperation is also sought in identifying modalities for establishing carbon markets, enabling climate finance and support in adopting new technologies. For India to deploy climate technologies at a significant scale, there is a need to put in place a facilitative global technology transfer regime and ensure that incremental and associated costs of these techs are met from multilateral climate change funds.
In the upcoming budget, we look forward to high-level announcements and commitments to be made with regards to energy transition, transport and adaptation measures just like in the last budget where the finance minister had announced the Green Hydrogen mission.
Director General, Confederation of Indian Industry