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Energy and Environment

Book Review: Environment, Climate Change and International Relation

 

Environment, Climate Change and International Relation is book published by E- International Relations Publishing, Bristol England in 2016 which is edited by Gustav Sosa-Nunez and Ed Atkins. The book contains 238 pages. The book is collection of well referenced articles relating to various aspects such as political, economic, social, and psychological and security aspects of environment and climate change. Each chapter is written by different set of author(s). The book is divided in three sections. First section deals with international relations tendencies on environment and climate change issues. Second section deals with assessments of situation and way to follow to address environmental and climate change issues. Third section deals with forward and backward steps taken globally to address the environmental and climate change issues.

 

In the first section of the book, there are five chapters. First chapter deals with the main strands of International Relations theory such as realism, liberalism, regime theory and constructivism, and how best these individual theories or a combination of the same can forge global cooperation in addressing climate change mitigation and adaptation and more specifically adaptation. It is argued that all strands of international relations theory have elements of cooperation for adaptation, but with varied ways and perspectives.  The  current  climate  regime  generally  reflects  a  mix  of neo-liberalism,  regime  theory  and  institutional  functionalism theory of international relations. Second chapter deals with perspective of global environmental changes in the anthropocene i.e. the period during which human activity has the dominant influence on climate and the environment. This chapter addresses the complex interrelations and feedbacks between the environment system and the human system. It also explores the potential of multilateral negotiations among governments, organised society, and business community on long-term sustainable development goals. The third chapter deals with linking humanity and nature to international politics of environment. It deliberates on concept of environment, science and politics, global environment, regime, environmental security, political economy, climate change, and anthropocene future in context to environment and climate change. Fourth chapter deals with institutionalisation of climate change in global politics. Here, it is argued that climate change has become institutionalised in global affairs as a top priority issue.  First,  there  is  a  strong  scientific consensus  that  greenhouse  gas  emissions  are  increasing  due  to  human behaviour  and  this  is  driving  up  average  global  temperatures.  In  addition, states including  major  powers,  regularly  meet  and  discuss  how  to  mitigate climate  change  at  global  summits.  Third,  states  have  committed  significant new  resources  to  address  climate  adaptation  and  mitigation  in  developing countries.  Fourth, in addition to United Nations Framework Convention on Climate Change(UNFCCC), a  wide  range  of  multilateral  institutions  such as United Nations  High  Commissioner  for  Refugees  (UNHCR)  to  the  World  Health Organisation  (WHO)  have  institutionalised  climate  change  within  their  work. In addition, a trans-national civil society movement for climate justice has also been  critical  at  keeping  pressure  on  states  and  global  institutions  to  take action.  This article complements the understanding of how environmental issues become institutionalised in global affairs. This chapter further argues that climate change is now widely recognised by states and institutions as one of the top global challenges.  This is evident from the changes that has occurred along four dimensions: 1) scientific consensus; 2) political action; 3) financial resources;  and  4)  institutionalisation  of  climate  change  in  multilateral organisations such as Intergovernmental Panel on Climate Change (IPCC) and UNFCCC. Fifth chapter deals with refusal to acknowledge the problem of climate change which is in interest of few, but it has adverse implications for many small and poor countries. It deliberates on influence of political ideologies on climate change denial, resistance to change in order to address climate change, acceptance of inequality and environmental injustice, and social dominance orientation through climate change denial. Here, it is argued that climate change denial is a motivated cognition underpinned by the willingness to maintain the status quo. It further argues that climate change denial does not merely reflect a general unwillingness to change, but more importantly seems to  include  acceptance  of  unequal  distribution  of  power  and  risks  among different  groups  of  people  and  between  humans  and  nature.

 

 

In the second section of the book, there are four chapters starting from chapter six to chapter eight. Sixth chapter deals with the transversal environmental policies. It deliberates on divergent policy approaches and the importance of environmental policy instruments, interdisciplinary role of environmental policies, and trans-boundary cooperation versus international governance in addressing environment and climate change issue. Here, it is argued that interdisciplinary spectrum of environmental policies includes not only socio-economic components but also physical, biological, mathematical and engineering ones. Finally a question is raised whether environmental policies are central or peripheral. Seventh chapter deals with the Environmental conflicts. Here, it deliberates on separation of environment from economy, defining the environmental conflicts, and environmental migrants. It further deliberates on looking beyond nature to economic  stability,  regime  type,  demography,  patterns  of consumption, historical consciousness and power dynamics etc that  play a role in the  construction  of  the  milieu for environmental conflicts. Here, it is argued that ecological factors are not the sole actor in the formation of patterns of conflict. Instead, they are part of a complex web of causality, coinciding with important social, political and economic factors that can result in both the presence and absence of violence. Eighth chapter deals with the role of non-state actors such as civil society and NGOs as drivers of change to global environmental governance. Here it deliberates on the rising power of civil society at multi-level, multi-actor and in multi-sector in global environmental governance; trans-national civil society; democracy inside civil society and its legitimacy; and new spaces of internationalisation and autonomisation for civil society in global environmental politics. Ninth chapter deals with the global climate change financing. It deliberates on effectiveness of environmental aid in addressing climate change, implementation mechanism of climate change finance, and associated challenges in arranging additional resources. It is argued that multilateral agencies fund different countries and projects compared to  bilateral  donors,  and  multilateral  assistance  tends  to  target  poorer countries  with  greater  needs.  Multilateral aid also tends to be less political, is associated with better outcomes, and appears better for more effective delivery.

 

In the third section, there are five chapters starting with chapter ten to chapter fourteen. Tenth chapter deals with new practices and narratives of environmental diplomacy. It deliberates on environmental diplomacy in international relations and global environmental governance, challenges and new approaches to climate change diplomacy, dialogue for progressive action as a diplomatic community of practice citing Cartagena Dialogue as an example; and green growth governance and hybrid diplomacy. In this  chapter, it is argued that environmental diplomacy plays a significant role in global environmental governance and that practice theory  and  narrative  theory  offer  better  models  of  analysis  than  more mainstream institutionalist, regime theory, multilevel governance or discourse. Eleventh chapter deals with future of Arctic on account of climate change and associated geopolitics. It deliberates on impact of climate change and consequent human activities in terms of shipping, extraction of oil and gas in the Arctic; intersecting interests of opening up or needs to savings of Arctic; and its implications for governance. Here, it is argued that due to climate change, retreat of sea ice in summer will take place and this will lead to increased human activities in Arctic for shipping and extraction of energy resources. However, whether Arctic should be opened up or saved from human activities is a matter of debate. Twelfth chapter deals with global challenges of developing and deploying renewable energy in order to reduce the emission of green house gasses (GHG). It deliberates on policy, technology and investment considerations for renewable energy; and global learning and diffusion of policy and technology to rest of the world. It is argued that although  the  adoption  of  renewable  energy  sources  is  increasing  in  many parts  of  the  world,  however, widespread  adoption  is  constrained  by  a  multitude  of policy,  regulatory,  technological,  social  and  financial  barriers that needs to be removed. Thirteenth chapter deals with the fossil fuel divestment movement (FFDM) within universities to tell the world that the fossil fuel industry is unsustainable and harmful business model. It deliberates on impacts of fossil fuel divestment; the divestment maths to limit 2°C the maximum amount of total global temperature rise; 565 GtCO2 (Gigatons of Carbon Dioxide) i.e. the maximum amount of carbon dioxide that can be emitted in order to stay within the two degrees Celsius warming limit; and 2,795 GtCO2 is already contained in the proven coal and oil and gas reserves. It further deliberates on impacts of fossil fuel divestment movement on coalition building against fossil fuel; and international impacts of fossil fuel divestment and its future trajectory. Here, it is argued that fossil fuel divest movement (FFDM ) has  played  a  major  role  in  shifting  ways  of thinking  around  climate  change  enabling  coalition  building,  and  has expanded  its  influence  well  beyond  college  campuses   into  the international realm. Fourteenth chapter deals with the initiatives of Norwegian government in investing in the Future environment and climate through divestment in Fossil Fuel and investments in renewable energy. It deliberates on fossil fuel divestment by city governments and pension funds, charities, philanthropies, and religious institutions, and the impact of the fossil fuel divestment movement. It further deliberates on ethical investment of Norway’s sovereign wealth fund in renewable energy, climate change, and divesting in unethical business of fossil fuels, land mines, cluster munitions and the production of nuclear weapons etc. It further deliberates on significance of Norway’s decision of ethical investment. It is brought out that in the wake of the decision of the Government of Norway to engage in fossil fuel  divestment,  there  has  been  a  significant  push  for  other  national governments  to  follow  suit  with  their  sovereign  wealth  funds.

 

Recognizing the importance and urgency of addressing climate change issue and considering the needs of concerted global efforts required to address climate change, the contents of book proceed further on ways and means to address climate change issue. It advocates on certain strands of international relations theory that can be well suited if applied to built consensus and cooperation among countries to make concerted efforts to mitigate climate change. It further deliberates on interactions between environment and human system, international politics of climate change, environmental conflicts, and institutional mechanism developed to address this issue. It further progresses on divergent environmental policies and role of civil societies to address climate change. Further, it discusses issues relating to availability of renewable technology and finance to mitigate climate change.  It also brings out new practices in climate change diplomacy, impact of climate change on Arctic region, initiative by some countries and institution to divest in fossil fuel which is the main cause of climate change. Therefore, barring the science and technology of climate change, most of the other aspects such as political, economic, social and security aspects of climate change have been covered in this book. However, some gaps still exists in the book such as why consensus is not building on concerted global effort to address climate change, what are the major barriers in building consensus and how to overcome it that needs further investigation. Overall, this book will be very useful for academician, researcher and policy makers to have a deep understanding of climate change and related issues, provide food for thought on further research and in framing climate related policy at national and international level.

The Possibility of ‘Japanese-Style Business Models ’ for Preserving the Earth

1. Introduction

Earth is different from other known planets as it supports life in form of variety of plants and animals. Survival of all livings beings and specially human being depends on adequate availability of resources such as clean air, water, food, energy, minerals and over and above a climate conducive to sustain life. However, excessive exploitation of resources on account of growing population of human being and its strive to enhance the quality of life has put tremendous pressure on natural resources as well as on environment. Excessive pressure on environment is reflected in climate change, land degradation, air and water pollution, ozone layer depletion, and loss of biodiversity etc.

Global warming and in turn climate change is one of the serious outcome of undue pressure on environment that has posed a major threat to this planet and consequently it has drawn greater attention of academicians, policy makers, intellectuals as well as general public in many countries. Several studies in past few years have suggested that global temperature has been rising in near past and this trend would be continued if emission of green house gases (GHG) is not arrested and brought under the permissible limit.

One of the major reasons attributed by scientist for global warming and in turn climate change is anthropogenic emission of carbon dioxide that is major constituent of GHG. As per Intergovernmental Panel on Climate Change (IPCC) global warming is likely to cause extreme weather conditions, variability in precipitation causing severe and frequent floods and draughts, sea level rise, increase in tropical cyclone etc. in varying degree depending on different geographical region adversely affecting agriculture, biodiversity and living conditions for human life.[1]

 

Energy is one of the most essential inputs required for socio-economic development along with many other important resources such as food and water, mineral etc. However, use of fossil fuel based energy is main contributor to emission of GHG causing global warming and in turn climate change. Growing global population, fierce competition for expanding the market backed with high technology and process of globalization especially by developed and some of the developing countries, and quest to achieve reasonable level of economic and social development by developing and least developed countries has continuously increased the use of energy in addition to other resources, and major content of which is fossil fuel that increases GHG emission. Climate change is a global issue; it would affect the whole world in varying degree, irrespective of the fact that who is responsible for degrading more by emitting more GHG. While some regions may be adversely affected, a few regions may be benefited also. However, overall impact of global warming and climate change projected by experts is likely to be detrimental overall. Therefore concerted efforts have to be made by whole global community to abate GHG emission and global warming commensurate with responsibility and capability.

If this planet is to be preserved from wrath of climate change and safely handed over to future generations, then emission of green house gases has to be reduced and its level in atmosphere is to be brought below safe limit. For preserving life support system two pronged strategy has to be adopted: mitigation as well as adaptation measures for climate change. Major contributor of GHG is use of fossil fuel based energy, therefore, use of fossil fuel based energy is to be reduced drastically, and development and use of new and renewable energy technology has to be increased to increase the share of clean energy in total energy supply mix in order to mitigate global warming and climate change. For adaptation of changing climate, more efficient climate control devices have to be developed and its use is to be proliferated across the globe.

 For reduction of energy related GHG emission, wasteful expenditure of energy is to be reduced by conservation measures as well as energy efficiency improvement. Moreover, use of new and renewable energy technologies such as fuel cell, hydrogen energy, solar power, wind energy and biomass technologies need to be increased globally by making it cost effective. In addition, all resources have to be utilized in most efficient way so that wastage is minimized, because, wastage of even abundant and renewable resources is also associated with wasteful consumption of energy with it in its whole processing chain.

For adaptation and climate control, energy efficient climate control technologies such as heating and cooling devices, and other house hold appliances and green building material needs to be developed to make living condition conducive against harshness of climate change. These requirements at global level provides ample opportunity to Japanese business to contribute preserving life at earth and expanding their market in area of climate change mitigation and adaptation products through expanding use of energy efficient, new and renewable technologies. Japanhas established its credentials globally as most energy efficient country and this provides a high premium for expansion of global market for Japanese energy, environmental and climate control products.

One of the important attributes of Japanese business culture is that it responds very well to crises situation.  After first oil crisis in 1973,Japanhas responded very well in conservation and efficient utilization of energy as well as other minerals and natural resources by reducing waste, recycling and reusing. This has also contributed a lot besides quality improvement of its product and services placingJapanas second largest economy in the world after US in a short period of time and most energy efficient country in the world and more specifically in most efficient use of energy in industrial use. It’s TPES/GDP (total primary energy supply/ per unit of gross domestic product) is less than half of US. When demand as well as prices for fossil fuel based energy is increasing continuously and time to time energy crises occurs, and countries are under pressure to reduce energy consumption to contain GHG within limit, people across the globe will look for a solution to reduce energy consumption without compromising the developmental objectives and level of comforts. And in this situation they can not ignore looking atJapanrather they will be compelled to look atJapanfor economically viable energy and environmental solution. IfJapanrealizes this situation and focus on development and promotion of the new technology to meet the emerging new demand, it may provide a big boost to its almost stagnant economy ofJapan. For example, Clean Air Act (CAA), 1970 was passed in US, but its strict standards were first adopted inJapanthat led to technological innovation in improving energy efficiency in vehicles produced by automobiles industries inJapanand consequently it dominated the global automobile market after first oil crisis in 1973. There is ample scope of replicating similar things in many products and services, if global requirement is properly assessed whereJapanhas edge over others. This will not only expand the business of climate related products and services, but it will also preserve the earth from scourge of resource depletion and global warming.



[1] Intergovernmental Panel on Climate Change (IPCC), “Global Climate Projections” in Climate Change 2007: The Physical Science Basis, Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change, Cambridge University Press,Cambridge, 2007 formulated response strategies. The First Assessment Report of IPCC served as the basis for negotiating the United Nations. Retrieved on 06/05/ 2008 from http://ipcc-wg1.ucar.edu/wg1/Report/AR4WG1_Print_Ch10.pdf

2. Strength and Weaknesses of Japanese Business Model

After Second World War,Japan made a rapid progress in industrial development in a short period of time and established its distinguished position in manufacturing of automobiles and consumer electronic products besides many other areas of excellence. The major strength of Japanese industries is its distinct industrial and business culture compared to western or Anglo-Saxon business culture. It’s industrial and business strategy and culture emphasized on little but continuous improvements in its product development involving all its employees at every level against western style where product development and improvement that comes through R&D and product development group where only few are involved. Life time employment has also played an important role in instilling and honing the skill of its employee. However, this strength of Japanese industry and business is reducing with erosion of this culture. How this culture can be retained to a reasonable extent will determine the success of Japanese business. However, too much inter-industry immobility of work force  will create barrier in development and establishment of new industries with new ideas, as new industry in same field can come up with some new innovative ideas and technologies and products if some reasonable degree of labor mobility is there.

Other area of concern is fundamental research and translation of research ideas in products and services. Despite huge amount of expenditure around 3.5% of GNP on R&D, absorption and improvement of technologies,Japanhas not made impressive impact on original development of products and services. EvenJapanhas not been able to translate the scientific developments in research laboratory and universities in development of new products and services like US and other western countries have done. For advancing fundamental research,Japanshould learn lesson from US that how it has invited best talents from all over the world and reaped its benefit. To attract the talents from other countries Japanese government and industries need to be flexible to accommodate the legitimate aspirations and cultural values of immigrant scientists and engineers so that best talents could feel at home and be attracted to work in Japan and could give their best. This needs to be realized that industrial and business culture in which Japanese can work comfortably, perhaps may not be conducive working environment for a foreign scientist and researcher. For nurturing creativity a reasonable degree of freedom is to be provided to the researchers. The main crux is how to strike a balance between the old business culture that improves quality and productivity in Japanese scenario and US type business culture that can promote fundamental research for development of innovative technologies and industries.

Other strength of Japanese industrial and business model had been use of value engineering to develop multitasking products. With development and proliferation of multitasking products, per capita use of natural resources as well as energy demand will reduce without compromising the quality of life. This would be able to address the growing population to some extent. Japanese industrial culture of Kaizen, Quality Circle, employee suggestion system, high level of knowledge and skill of its employees due to life time employment, and Total Quality Management are conducive for development of these types of products compared to their Anglo-Saxons counterparts where division of labor is very much compartmentalized. Some of these cultures had been eroding in recent past, but nurturing of these values further will enhance the capability of Japanese business and industry and provide edge in global market. 

3. Focused Areas of Attention

The areas of attention can be divided in the following categories for mitigation and adaptation of climate change through proliferation of use of energy efficient climate control products.

3.1 Energy Conservation:

Various types of sensors and control devices such as occupancy sensors that reduces waste expenditure of energy is to be developed at reasonable price so that its use could proliferate in developing countries also which has a potential of large market. Unfortunately, in past few decadesJapanhad been concentrating on the needs of mainly developed countries that had more per capita paying capacity. However,China targeted more comprehensive market that boosted its economy.

3.2 Energy Efficiency Improvements

Japan has been leader in development of energy efficiency products and services. Image of very high level of energy efficiency of Japanese automobile, consumer electronics and home appliances are well established in the mind of consumers across the globe. Similarly, people in organized industry across the world know very well about possession of advance and energy efficient processes and technologies for industrial production, be it power generation, iron and steel production or transport system. Power sector, right from generation side to distribution side is one important area whereJapanshould concentrate on expanding its market as it has established itself as one of the most energy efficient in power generation and one of the best in minimizing transmission and distribution losses. Similarly, many of other energy intensive industry such as iron and steel, heavy chemicals and fertilizers, papers etc whereJapanhas established very low energy intensity (low energy consumption per unit of products produced) should be showcased byJapanto outside world. Proliferation of these energy efficient process and technologies to other developed and specifically to developing countries will not only reduce the emission and abate the climate change in preserving earth, but it will also give a boost to almost stagnant economy ofJapan.

Similarly, energy efficient and eco friendly design and construction of commercial and residential buildings can reduce the energy requirements and GHG emission to a great extent. This will also improve the living conditions for human being against harshness of climate change with minimum energy use. Though design and architecture would be highly influenced by local factors such as climatic condition, cultural preferences, but againJapancan contribute a lot by providing energy efficient building insulation materials, solar photo voltaic panels to generate electricity in building, energy efficient building appliances and gadgets to other countries.

 

3.3 Development of new and renewable technologies

If earth is to be saved from menace of global warming and climate change, then share of clean energy in total energy supply mix has to be increased. And for this major source of clean energy i.e. solar power has not been effectively utilized across the world.Japanused to have a leading position in solar photovoltaic panel production which has been taken over by others. If cost can be cut down with increased scale of production and improve its efficiency at which Japan has proven capability, there would be tremendous demand as prices of energy resources keeps on increasing especially of oil. Similarly, hydrogen and fuel cell is another area whereJapancan do lot to reduce global warming and boost its economy. However, this area requires more research to make it cost effective generation of hydrogen, methods of safe storage and distribution and devices to convert this useful energy in useful work at user end. Similarly, other new and renewable energy technologies need to be developed and promoted whereJapanhas strength. Nuclear power is a clean source of energy, but its wide spread use has other safety and security consequences. 

3.4 Adaptation

For adaptation measures, climate control devices such as energy efficient heating and air conditioning devices are essential. Moreover, thermal insulation in building can reduce the energy requirement without compromising the comfort level. Japan is well placed in possession of energy efficient technology and material in this field which can come to rescue in reducing GHG emission and save human life on this planet from scourge of climate change.

Other areas for focused attention could be clean air and water. Apart from GHG, emission of other gases such as SO2 ( sulphur dioxide) is also emitted when fossil based energy is used for power generation or industrial activity and excessive emission of SO2 causes acid rain which is very harmful for human and other plants and animal. However, its impact is local unlike GHG.Japanhad serious problem of SO2 in 1960s but it controlled very well, but still in many parts of developing world this is a big problem whereJapancan take lead. SimilarlyJapanhas lot of expertise in solid waste management which also emits methane, one of the potent GHG. This could also be one of focused area for expanding business as well as preserving earth.

Climate change is likely to impact variability of precipitation that may redistribute the water availability over geographical region and time. At certain point of time there would be excessive water and at certain point of time there would be water scarcity. This would adversely impact the quality and availability of potable water as well as water for industrial and agriculture purpose. At individual family level, it would require water purification devices in large quantity. At municipal level and national level it would require the development of infrastructure for managing fresh water resources. In costal areas demand for more desalination plant may arise. Demand for automatic water control and conservation equipment will increase. Again in this areaJapancould make a contribution in global water management for sustainability of life and can expand its market share also. Water pumping is another area which consumes a lot of energy in agricultural, industrial and residential sector. Energy efficient water pumping could be another area which requires focused attention

 

4. Direction of market expansion

In past few decades especially after qualitative improvement of its products in post war period, Japanese economy has focused its attention on western market, only in recent past it has diverted its attention towards developing countries. Almost 20 % populations of developed countries are consuming 80% of global energy. However, majority of problems related to energy, water and environment lies in developing countries be it scarcity, inefficient use of energy and water or degradation of environment. And as  some of the developing countries as they are progressing and their purchasing capacity is increasing, and demand for energy, products consuming energy, and others product for water purification and environmental control is increasing, and in turn a new   market is being created. NowJapanshould focus on volume of market in energy and environment. One of the most important requirements for developing and capturing the new market is to study consumer behavior. Therefore, consumer behavior of targeted country needs to be studied. And accordingly product and services related to energy and environment needs to be developed and existing products need to be modified and improved upon to suite their requirement. It is not necessary that particular item should be developed for specific country, but multiple options for a particular type of product should be created so that it fulfils the specific requirement of major market. When the market of developing country is to be targeted, it should be kept in mind that cost is an important factor. Profitability has to be increased by increasing the volume of the sale with low profit margin in each product rather than charging high profit margin with low sales volume. For achieving this, strict cost control measures have to be applied. If comparative advantage exists for shifting the location of manufacturing to another country based on considerations of low labor cost, raw material availability, market or any other benefits or combination thereof, it must be applied. But in such case, it should also retain its culture of striving for continuous improvements of its products and services

To establish the credibility of its energy efficient and CO2 sensitive economy, Japan should meet its GHG reduction target under Kyoto Protocol without using CDM (clean development mechanism) or joint implementation, though it is unfairly high compared to many developed countries whose per capita emissions are higher than Japan. It will further establishJapanas most energy efficient and GHG sensitive country. In postKyotonegotiations when very high GHG emission reduction target will be placed for many countries, countries will be compelled to look towardsJapanfor energy and environmental solutions. This will help in preserving earth as well as expanding market for Japanese products or services.

 

5. Conclusions

The environmental degradation and especially climate change has posed a great problem to this planet as far as sustainability of life is concerned. If earth has to be preserved to sustain life on this planet, then mitigation and adaptation of global warming and climate change has to be addressed suitably. For mitigation more and more energy efficient products needs to be developed and its use need to be proliferated globally in all sectors: right from energy resources excavation to conversion to transmission and distribution to end use in energy sector; agricultural sector, industrial, transport and residential sector.Japanhas niche in development of energy efficient, multitasking value added products utilizing unique Japanese business cultures such as Kaizen, quality circle, employee suggestion systems etc. Similarly, for adaptation measure, climate control products and devices needs to be developed. To achieve this it would be essential to that Japan should focus its attention on developed as well as developing countries where demand for these products are likely to increase fast for survival.Japanneed to study consumer behaviors of developing countries and provide many options to suit their requirements. Moreover, it should reduce the cost of its products to make it affordable to developing countries. And to achieve this if required, manufacturing business could be shifted to other courtiers to take the comparative advantages cheap labor, market and other material resources.Japanhas not performed well in fundamental research or translating the research in products. For this they should think of adaptingUSmodel which has flourished on the strengths of scientists from other countries. This will provide added advantage to Japanese industries and business in long run and help in ameliorating the reducing working population especially in R&D field ofJapan.

Japanshould meet its GHG emission reduction target without utilizing CDM, JI or emission trading. It will further bolster its credential as most energy efficient as well as CO2 sensitive country and this will give a boost to development and use of more energy efficient product to reduce GHG emission globally as well as strengthening economy of Japan when more stringent and very high GHG emission reduction targets are likely to be set in post Kyoto negotiations. Probably this strategy will help in preserving the earth from danger of global warming and climate change and boost the economy of Japan.

                                                                  

 

 

 

 

 

 

HISTORICAL PERSPECTIVE OF ENCON ACTIVITIES IN INDIA - ENERGY CONSERVATION ACT 2001

 

 

 

 

INTRODUCTION

 

Energy is an essential input required for economic as well as overall development of the nation. Although India ranks third in the world so far as total energy consumption is concerned, but still much more energy is needed to keep pace with its development objectives. At present India is net importer of energy. Most of  energy requirement of India is met through fossil fuel that is limited and petroleum fuel that leads to dependence on imports and energy insecurity. Studies have indicated that there is a substantial scope of energy saving in Indian economy without foregoing any end-use benefits through efficient use and elimination of wasteful expenditure of energy. Energy savings can be achieved at much lower cost compared to additional capacity creation. Moreover, energy efficiency measures are benign to environment also. Therefore, a paradigm shift from supply-dominated approach to overall energy efficiency approach is needed to meet energy demand.

 

II. HISTORICAL BACKGROUND OF EC ACT

 

Energy efficiency is not a new programme in India though its impact have been somewhat limited. A number of industries have been quite successful in implementing energy saving measures but these efforts were restricted to few industrial units, while majority of the industrial units lag behind. Since long a number of organizations of national repute were involved in promotion of energy conservation efforts viz. Rural Electric Corporation for promoting energy efficiency in agricultural pump sets, industry association in promoting energy efficiency in industries, The Energy Research Institute (TERI) and many other institutes in providing training and consultancy in energy efficiency and its conservation. In the wake of global oil crisis, the Government of India made several efforts to propagate conservation of petroleum products. This led to establishment of Petroleum Conservation Research Association (PCRA) in 1976 which has done commendable work to this end.

 

As per allocation of business rule, Ministry of Power is charged with energy and energy conservation. Department of Power under Ministry of Irrigation and Power had a concern for Energy Conservation in its generating power stations under its Central Public Sector Units right since inception. However, realizing the potential of energy efficiency and conservation in end use of energy, a holistic and systematic view was taken and an inter ministerial working group was constituted in 1981 that submitted its report in 1984, which provided the vision for instituting energy efficiency in the country. Consequently Energy Conservation Wing was created in Department of Power under Ministry of Irrigation and Power in way back in 1985 which formulated various policies, schemes and energy management programmes. Subsequently the Energy Management Centre (EMC), a Registered Society was set up by the erstwhile Ministry of Energy, Department of Power in 1989 to promote energy conservation in various sectors of economy. In absence of any legislation on conservation of energy, there was no legal powers available for enforcement of energy efficiency and conservation measures in order to reduce the energy intensity of the Indian economy and only promotional activities were being taken up. Therefore, the Govt. of India felt the need to evolve a regulatory and promotional mechanism to that end.

 

In 1994 Ministry of Power constituted a Working Group consisting of representatives from various Ministries for formulation of suitable proposal for a selective legislation on energy conservation. Proposal of energy conservation legislation as formulated, was modified in the light of the comments of the State Governments and discussions held in the inter-ministerial meeting held in January 1997.The proposal was reviewed again by Ministry of Power in July 1997 and it was decided to propose an enactment for energy conservation which inter alia would provide setting up of a Bureau of Energy Efficiency (BEE) to perform various function relating to energy conservation. This revised proposal was circulated to all the concerned Ministries. Union Minister of State for Power held a meeting with various industry associations. A Cabinet Note was then prepared and the same was approved by the Cabinet in September 10.09.97. Subsequently, the Ministry constituted a one man expert Committee to review the various provisions made in the proposed Energy Conservation Bill. The present Energy Conservation Act, 2001 is based largely on the recommendations of the Expert Committee. After obtaining the approval of the Cabinet, Energy Conservation Bill, 2000 was introduced in Lok Sabha in February, 2000. The Hon’ble Speaker referred it to the Standing Committee on Energy (1999-2000 – 13th Lok Sabha). The Committee heard the views of representatives of industry, institutions, experts, Ministry of Power and others and submitted its recommendations in its 9th Report in November, 2000. The Cabinet approved the proposal for enactment of the EC Bill, 2000 incorporating all the recommendations of the Committee on Energy in 2001. The amended EC Bill was finally passed by the both Houses of the Parliament and the President of India gave his consent to the EC Bill in September 2001. Finally The Govt. of India enacted the Energy Conservation Act, 2001 which has come into force in from 1st March,2002 and an institution in the form of Bureau of Energy Efficiency (BEE) with legal backing was created to promote energy efficiency. 

 

 

 

III. THE ENERGY CONSERVATION ACT 2001

 

In the Energy Conservation Act, 2001, Energy has been defined as any form of energy derived from fossil fuels, nuclear substances or materials, hydroelectricity and includes electrical energy or electricity generated from renewable sources of energy or bio mass connected to grid. The important features of EC act can be broadly categorized as mandatory and voluntary provisions of the Act.

 

1. Mandatory Provisions

 

Following programmes have been taken under mandatory provisions of the EC Act, 2001.

 

1.1 Standard and Labeling Programme

 

Standard and labeling programme has been identified as one of the key activities for energy efficiency improvement in equipments and appliances of common use, where wide variation in energy consumption of product of the same output rating made by different manufacturer exists. Moreover, information on energy consumed by the product is often not easily available or easy to understand that leads to continued manufacture and purchase of energy intensive and inefficient equipment and appliances.

 

In order to improve the energy efficiency of widely used equipment and appliances consuming relatively high energy, a minimum energy consumption and performance standards for notified equipments and appliances have been evolved and this process is continuing fopr other equioment. Manufacture, sale, purchase or import of equipments and appliances not conforming to standards will be prohibited. A suitable mandatory labeling will also be introduced for notified equipment and appliances to enable the consumers to make an informed choice about energy efficiency. Energy label regulation has been implemented for Refrigerators, air Conditioner, Agricultural pump sets, Motors, Flouroscent tube lights and distribution transformers etc.

 

1.2 Designated Consumer Programme

 

Indian industrial sector accounts for about half of the total commercial energy used in the country. There is wide variation in energy consumption co-efficient among different units in the same industry using comparable technologies. To improve energy efficiency in selected industrial units and other establishments Designated Consumer Programme have been taken.

 

List of Designated Consumers have been provided in the schedule to the Act based on the intensity or quantity of energy consumed by any user or class of users of energy. Designated consumers have to designate or appoint a certified energy manager who will be instrumental in complying with the norms set for particular industry through implementation of energy efficiency and conservation measures . Designated Consumers are also be required to get energy audited by an accredited energy auditor and implement recommendations of audit provided the amount of investment required for switching over to energy efficient equipments, capacity of industry to invest in it and availability of energy efficient machinery and equipment required by industry is there.

 

As a pre-requisite to implement Designated Consumer Programme first national level certification examination for Energy Managers and Energy Auditors were conducted in May 2004 and about 800  certified Energy Auditors and Energy Managers were put in place. This process of certification of Energy Auditor and Energy Manager is continued. To build up capacity of energy auditing firm two accreditation committees have been constituted. Initially, Cement and Pulp and Paper Sectors have been selected for the developments of the norms. Technical Committee comprising of experts from R & D organization, Cement Manufacturing Association and cement plants have been constituted for cement plants. Similarly, technical Committee for paper industry comprising of experts from Central Pulp and Paper Research Institute, Paper Mill Associations and paper plants representing all regions of the country has been formed. Two web sites "bee-india.nic.in" and "energymanagertrainin.com" have been launched to provide information on best practices on energy management, technical papers, events, problems and solutions related to energy efficiency.

 

1.3 Energy Conservation Building Code Programme

 

A lot of energy savings potentials have been identified in buildings in heating, ventilation and air conditioning (HVAC) system, lighting and service water pumping and heating etc. For the buildings as defined for the purpose of the Act, provision has been made in Section 14(p) of the Act to prescribe energy conservation building codes for efficient utilization of energy in the building or building complex. These codes may be amended to suit the regional and local climatic conditions. Every owner or occupier of the building or building complex, being a designated consumer will be required to comply with the provisions of of energy conservation building codes for efficient use of energy and its conservation.

 

A committee of experts were constituted to guide the development of codes.  These Energy Conservation Building Codes (ECBC) were finalized and and launched in 2005.

 

2.Voluntary Provisions

Following activities have been taken for creating awareness and disseminate information for efficient use of energy and its conservation, promoting innovative financing of energy efficiency projects and preparation of educational curriculum on efficient use of energy and its conservation as desired under voluntary provisions of the Act.

 

2.1 Energy Conservation in the Government Buildings

 

As a voluntary measure, the Ministry of Power through Bureau of Energy Efficiency  coordinated  implementation of energy efficiency measures in 9 government buildings. Energy audit studies were completed in 9 government buildings in Delhi, including Rashtrapati Bhawan, Prime Minister’s Office and Defence Ministry in South Block, Rail Bhawan, Sanchar Bhawan, Shram Shakti Bhawan,&Transport Bhawan, R&R Hospital, Terminal I, Terminal II and Cargo Sections of Delhi Airport, and All India Institute of Medical Sciences (AIIMS). A Savings potential between 25 to 46 % was identified in the above buildings. Contract was awarded for Implementation of recommendations of energy audit studies in Rashtrapathi Bhawan, Shram Shakti Bhawan and other buildings in phases through energy service companies (ESCOs) .

 

2.2 Energy Conservation Awareness Programme

 

To bring about attitudinal and behavioral changes in the society, it is necessary to introduce the concepts of energy conservation and efficiency to children through school education. The Bureau of Energy Efficiency has undertaken the above Programme which covers development of course materials and introduction in curriculum for 6th to 9th standard, and sensitizing teachers, creating awareness among student through competition like essay writing and painting. As a pilot project, the Bureau has undertaken the project in 30 schools of Delhi. In addition a year-long National Campaign on Energy Conservation was launched by Hon’ble Prime Minister on 14th December 2004 i.e.National Energy Conservation Day focusing industrial, commercial ,domestic, agriculture sectors, government buildings, educational institutions and public sector units. This campaign aimed at spreading information about energy, simple methods of conservation and efficient use of energy and create energy conservation awareness effectively and rapidly among the public nationwide. This effort is still continued

 A Postage Stamp on Energy Conservation theme was also released by Hon’ble Prime Minister on 14th December 2004 to sensitize the public at large on Energy Conservation issues.

 

 

 

2.3 National Energy Conservation Award:

 

Under the innovative schemes initiated by the Government of India, Ministry of Power has been organizing the National Energy Conservation Awards over the last one decade on National Energy Conservation Day observed on every 14th December to promote energy conservation. These awards are a means to institutionalize the energy efficiency movement in the country by identifying and giving recognition to the energy conservation efforts undertaken by different firms and industries that excels in energy efficiency and its conservation in their activities. In National Energy Conservation Awards 2004, 297 industrial units participated and cumulatively saved Rupees 763 Crores against an investment of Rs 1364 Crores through energy efficiency in monetary terms. In terms of energy they saved 2.49 lakhs kiloliters of furnace oil, 5.37 lakhs metric tones of coal, 18585 lakhs cubic meters of gas and 814 million units of electrical energy which is equivalent to avoided generation capacity of 155 MW. Over the years more industrial sectors, buildinding and commercial sectors have been brought in its ambit. 

 

 

IV ROLE OF ENERGY SERVICE COMPANIES (ESCOS) TO REMOVE BARRIERS TO ENERGY EFFICIENCY

 

There are numerous barriers to the adoption of energy efficient technologies and practices. Some of these are lack of awareness, information, training, favorable market for energy efficiency, standardization and labeling of equipments, availability of appropriate energy efficient technologies and financing etc. Energy Service Companies can play a vital role in removing some of these barriers to energy efficiency. Basically ESCOs provides energy management services to an energy user right from identifying and evaluating energy- savingopportunities, development of engineering design and specifications, managing the project from design to installation to monitoring, arranging the finanaces, training energy user’s staff and providing ongoing maintenance services to guaranteed savings that covers project cost . One of the greatest benefits of the performance based contract is that the ESCOs supplies the project funding , which relieves the user of energy of paying up-front capital cost. The world wide market for end use energy efficiency technology is growing rapidly on account of energy security and environmental concerns. In this situation effective role of ESCOs will offer win-win situation for everybody.

 

Evaluating Emission Reduction Targets in UNFCCC Kyoto Protocol by Applying Primary Data Analyses

 Published in Asian Journal of Public Policy Vol.2,No.1,March 2009 ,36-56

Dinesh Chandra SRIVASTAVA1 and Tatsuo OYAMA2

1,2 National Graduate Institute for Policy Studies

7-22-1Roppongi, Minato-ku,Tokyo106-8677JAPAN

 

 

Abstract

Emission reduction targets set for Annex I countries to the Kyoto Protocol have been raising questions about its rationality though it has been agreed by member countries. This paper focuses on evaluation of emission reduction targets in the Kyoto Protocol based on energy supply structure and consumption analysis for major developed and developing countries. Energy supply and consumption, per capita energy consumption, per capita emission, share of clean energy in energy supply structure for 13 OECD and non-OECD Annex I and non-Annex I countries to the Kyoto Protocol have been analyzed. It is argued that emission reduction targets set in the Kyoto Protocol for various Annex I countries are neither rational nor consistent from the viewpoint of energy data analysis. Furthermore, it is recommended that a common per capita emission norm is a more rational and simple approach to set an emission reduction target.

 

1. Introduction

 

Global warming and in turn climate change has posed a major threat to this planet and consequently it has drawn greater attention of policy makers as well as the general public in many countries. Several studies in the past few years have suggested that global temperature has been rising in the recent past and this trend would be continued if emission of green house gases (GHG) is not arrested and brought under the permissible limits. One of the major reasons attributed by scientists for global warming and in turn climate change is anthropogenic emission of carbon dioxide that is a major constituent of GHG. According to the Intergovernmental Panel on Climate Change (IPCC), global warming is likely to cause extreme weather conditions, variability in precipitation causing severe and frequent floods and draughts in varying degree depending on different geographical region adversely affecting agriculture, living conditions for human life, sea level rise, increase in tropical cyclone etc.[1]

Energy is one of the most essential inputs required for socio-economic development. However, the use of fossil fuel based energy is the main contributor to emission of GHG causing global warming and climate change. Fierce competition for expanding the market backed with high technology and process of globalization especially by developed and some of the developing countries, and the quest to achieve a reasonable level of economic and social development by developing and least developing countries has continuously increased the use of energy, the major content of which is fossil fuel that increases GHG emission. Climate change is a global issue; it affects the whole world in varying degrees, irrespective of who is responsible for degrading more by emitting more GHG. While some regions may be adversely affected, a few regions may be benefited also. However, the overall impact of global warming and climate change projected by experts is likely to be detrimental.

In 1992 the United Nations Framework Convention on Climate Change (UNFCCC) initiated the treaty for the framework of climate change. Then, in December of 1997, the Kyoto Protocol was adopted in Kyoto, Japanat the third Conference of Parties (COP 3). For 37 industrialized countries and the European community targets were set for reducing GHG emissions to an average 5.2 % from the 1990 level over the five-year period 2008-2012. After a series of annual COP negotiations, held successively in Buenos Aires, Bonn, Hague, and Bonnfrom 1998 to 2000, participants in the COP 7, held in Marrakeshin 2001, agreed on the detailed implementation rules for the Kyoto Protocol. Thus, the Kyoto Protocol entered into force in 2005. Then, in December of 2008, the COP 14, held in Poznan, Poland, failed to reach an agreement even though targets for the year 2020 were proposed by such countries as EU, Canada, Australia and the US, whose respective targets were 20% reduction from 1990 level, 20% reduction from 2006 level, 5 – 15% reduction from 2000 level, and the 1990 level. Global warming and climate change are very serious problems for modern human society, requiring urgent solutions through international and global, economic and political cooperation. We may have to rebuild our society into a less energy intensive form by changing our lifestyle if necessary, and, moreover, we may need to apply economic approaches based upon such activities as CO2 emissions trading in a “carbon market” and promoting renewable energy through certain market mechanism such as joint implementation, the clean development mechanism and so on.

In national and international forums climate change has become one of the most important topics for discussion and debate as a global issue. Moreover, delay in ratification of the Kyoto Protocol by theRussian FederationandAustralia, and non ratification by theUSAmake many ask why these countries were hesitant to ratify the protocol. Many countries that are required to reduce the GHG emission to a specified level below the 1990 level under this protocol have not shown a GHG reduction trend despite a very small target of GHG reduction compared to the gravity of the problem. One of the reasons could be a perception of inequitable emission reduction target for various countries that makes them hesitant to take up the emission reduction initiatives vigorously.

The Kyoto Protocol has been seen to be insufficient even though it has come into force in 2005. The reduction target beyond 2012 has been argued to be more important according to a quantitative investigation using game-theoretic approach to finding the relationship between future CO2 emission reduction target and participation incentives (Buchner and Carraro 2005). The quantitative approach using policy simulation modeling (FUGI global model) has also been applied in order to investigate the relationship among those factors such as energy requirement, CO2 emission and global economy, thus providing global information to the human society through finding out possibilities of policy coordination among countries with respect to global warming effects (Onishi 2005, 2007). In order to reduce the CO2 emission in each country, certain kinds of regulation enforced by central and local governments would be effective and necessary. In addition to the strong effectiveness of federal regulation, voluntary efforts made by firms and pressures by nongovernmental entities as a substitute for regulation, are reported to be useful and important (Harrison and Antweiler 2003).

This paper aims to evaluate the rationality of emission reduction targets set in the Kyoto Protocol for various countries based upon primary energy data such as per capita energy consumption, per capita CO2 emission, share of clean energy and their historical trend. Fossil fuel based energy use is the main cause of GHG emission and in turn global warming and climate change. Each country is placed differently in terms of types, amount and mix of energy production and consumption depending on its local availability, technical and financial capability that affects GHG emission. This study investigates the role of these factors in GHG emission reduction target under Kyoto Protocol so as to learn the lessons from the Kyoto Protocol so that such future negotiations could be made more effective.

The research methodology used in this paper is a mix of statistical analysis and deductive reasoning applied to energy supply data of 13 Annex I and non-Annex I countries: Australia(AU), Brazil(BR), Canada(CA), China(CN), Denmark(DK), Germany(DE), India(IN), Japan(JP), Norway(NO), Russian Federation(RU), South Africa(ZA), South Korea (KR, Republic of Korea) and United States of America (US, USA). Status of countries with respect to OECD membership and its inclusion in Annex-I to the Kyoto Protocol is shown in Table 1. The major source of energy use and CO2 emission data is IEA (International Energy Agency) and UNFCCC (United Nations Framework Convention on Climate Change). Only GHG emitted from use of energy resources has been considered because it is a major contributor; other sources of GHG emission have not been considered in this study.

 

Table 1: List of Countries under Study

 

 

OECD

Non-OECD

Annex-I

Australia(AU), Canada(CA),

Denmark(DK), Germany(DE),

Japan(JP),Norway(NO),USA(US)

Russian Federation(RU)

Non- Annex I

South Korea(KR)

Brazil(BR), India(IN),

China(CN), South Africa(ZA)

 

These countries are divided into OECD Annex I and non-Annex I countries, and non-OECD Annex I and non-Annex I countries to the Kyoto Protocol. Countries have been selected to represent wider regions of the world viz. North America, Africa, Asia,Australia, Europe including Nordic countries, andLatin America.

In the following section, we investigate the trend of total primary energy supply and demand pattern, and trend of CO2 emission during the period 1973 to 1999/2005 for the countries under study. In Section 3, the share data of clean and renewable energy is identified in total primary energy supply structure: thus clean energy supply structure has been investigated. Section 4 focuses on CO2 emission from the viewpoint of origin and development of climate concern, IPCC and the Kyoto Protocol and issues related to climate change and the Kyoto Protocol. In Section 5, we try to evaluate CO2 emission reduction targets set under the Kyoto Protocol for countries under study by comparing them based on per capita energy consumption, per capita CO2 emission, share of clean energy, thus emission reduction target has been evaluated. In Section 6, observations are summarized, and conclusions are drawn.

 



[1] Intergovernmental Panel on Climate Change (IPCC), “Global Climate Projections” in Climate Change 2007: The Physical Science Basis, Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change, Cambridge University Press,Cambridge, 2007 formulated response strategies. The First Assessment Report of IPCC served as the basis for negotiating the United Nations. Retrieved on 06/05/ 2008 from http://ipcc-wg1.ucar.edu/wg1/Report/AR4WG1_Print_Ch10.pdf

 

 

6.  Summary and Conclusions

 

Global warming and climate change is an important and alarming global issue that is posing maximum threat to life on this planet that can be addressed by reducing anthropogenic emission of GHG. Setting targets for emission reduction for various countries is an intricate issue. The main problem in the global warming and climate change issue is that different countries have contributed in widely varying degrees to this problem, and its impact is also projected to be different for countries depending on the region in which they are placed irrespective of the fact of who has contributed more to this problem. There could be a situation when a country is not responsible or least responsible for contributing to climate change, but the threat of climate change is much more to that country and vice versa.

Another important issue is the varying degree of capability and situation of various countries to take up the mitigation and adaptation measures to address the climate change issue. The level of development in terms of per capita energy consumption, technical and financial capability, economic structure, existing energy infrastructure and energy resource base make for an uneven playing field for various countries in taking up mitigation and adaptation measures, especially developing countries are placed disadvantageously to take up adaptation measures and to some extent mitigation measures too. The process of establishing quantified emission limitation and reduction objectives need to take into account these points as add on, but should hinge on per capita emission. This approach may form a strong and cohesive coalition to fight against global warming and climate change for which equitable and appropriate contributions by countries following the principle that polluter pays would be necessary. This would ensure opportunity to all for sustainable growth.

However, the main challenge lies in setting the emission reduction target and other responsibilities so that it should appear justifiable and be readily acceptable by the countries and could be acted upon in letter and spirit. As far as emission reduction target is concerned, there are many factors as mentioned earlier. However, historical and present emission, per capita energy consumption and per capita emission, and share of clean energy are some of the important major factors on which targets should be set for the countries in the Kyoto Protocol; but, emission reduction targets for many countries included in this study are not consistent and rational as per these norms. The analysis shows that Japanis disadvantageously placed compared to Canada; and Germanyis placed disadvantageously compared to Canada, USAand Australia. Similarly Australiahas been allowed to increase the emission. In the Kyoto Protocol emission reduction targets are very modest, so most of the countries have sooner or later accepted the target without much complaint except US. However, most of Annex-I countries have not been able to reduce their CO2 emission level below 1990 despite a very modest target. The post Kyoto emission reduction targets would be substantially higher if the climate change problem is to be addressed effectively. It would only be able to achieve its intended goal if a justifiable and rational emission reduction target is set for countries converging on a common per capita emission of CO2 in the long run. A common global average per capita emission approach will engage all the countries right from the least developed to the most developed countries. Common average per capita emission can be revised at a regular interval of five years or so. The countries that are emitting more than global average can pay certain amount of taxes that can be used to develop and accelerate the use of clean environmental technology. The environmentally proactive countries can reduce their per capita emission and force the other countries also to reduce their per capita CO2 emission by bringing down the average global CO2 emission. This will create a game like situation and environmentally benign action of one country will force other countries to follow the same suit. This will accelerate development and use of environmentally clean technology. The countries who lead in clean energy and environmentally benign technology would benefit more by being more competitive for structuring the system to promote competitiveness.

The most important action to mitigate the impact of climate change without compromising the developmental issue would be to increase the share of clean energy supply in total energy supply structure. This can also be one important criterion in emission reduction target. However, general top-down approach in development of clean energy should not be adopted as what effectively and efficiently can work in developed countries may not necessarily work in developing countries. Availability of clean energy technology at reasonable cost is a major barrier in development of renewable and clean energy especially in developing countries. An environmental tax on those who emit more than average global per capita CO2 can also be levied and revenue received can be used to set up nuclear power plant and on regional basis in order to increase the share of clean energy under supervision of international organization to produce clean energy without threat of misuse of nuclear fuel and safe disposal of nuclear waste. 

 

 

 

References

1. Buchner, Barbara, and Carraro, Carlo, 2005. “Modelling Climate Policy Perspectives on Future Negotiations”, Journal of Policy Modeling, 27, pp.711-732.

2. Harrison, Kathryn, and Antweiler, Werner, 2003. “Incentives for Pollution Abatement : Regulation, Regulatory Threats, and Nongovernmental Pressures”, Journal of Policy Analysis and Management, Vol.22, No.3, pp.361-382.

3. International Energy Agency, 2007. IEA Statistics: Energy Balances of non-OECD Countries 2004-2005, IEA Publications, Paris.

4. International Energy Agency, 2001. IEA Statistics: Energy Balances of -OECD Countries 1998-1999, IEA Publications,Paris.

5. Intergovernmental Panel on Climate Change (IPCC), Working Group 1 (WG1), Assessment Report 4 (AR4) Report: Frequently Asked Questions, retrieved on 05/05/2008 from http://unfccc.int/files/meetings/cop_13/application/pdf/cp_bali_act_p.pdf

6. Intergovernmental Panel on Climate Change (IPCC), Fourth Assessment Report, Synthesis Report, Press Presentation, 17 November, 2007, Valencia, Spain Retrieved on January 27, 2008 from http://www.ipcc.ch/pdf/presentations/valencia-2007-11/pachauri-

17-november-2007.pdf )

7. Intergovernmental panel on Climate change (IPCC), Assessment Report 4 (AR4), Working Group 1 (WG1): Summary for Policy Makers, retrieved on 12/04/08 from http://ipcc-wg1.ucar.edu/wg1/Report/AR4WG1_Print_SPM.pdf

8. Intergovernmental Panel on Climate Change (IPCC), “Global Climate Projections” in Climate Change 2007: The Physical Science Basis, Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change, Cambridge University Press, Cambridge, 2007 retrieved on 06/05/2008 from http://ipcc-wg1.ucar.edu/wg1/Report/AR4WG1_Print_Ch10.pdf

9. Gupta, Joyeeta, 2006. “Good governance and climate change: Recommendations from a North –South perspective”, in EU Climate Change Policy: The Challenges of New Regulatory Initiatives, ed. Marjan Peeters and Kurt Deketelaere, Edward Elgar Publishing Limited,UK .

10. Onishi, Akira, 2005. “Futures of Global Interdependence (FUGI) Global Modeling System Integrated Global Model for Sustainable Development”, Journal of Policy Modeling, 27, pp.101-135.

11. Onishi, Akira, 2007. “The Impact of CO2 Emissions on the World Economy Policy Simulations of FUGI Global Model”, Journal of Policy Modeling, 29, pp.797-819.

12. Paterson, Matthew and Grubb, Michael 1992. “The International Politics of Climate Change, International Affairs”, Royal Institute of International Affairs 1944-, Vol. 68 No.2, pp. 293-310, retrieved on 07/04/2008 from http://www.jastor.org/stable/ 2623216

13. Shiroyama, Hideaki, 2002. “Technological Innovation and Diffusion for Environmental Protection : The Role of Public Policies, Private Strategies, and Civic Actions from an Interaction Perspective”, Energy Market Restructuring and the Environment : Governance and Public Goods in Globally Integrated Markets, ed.  Martha Harris, University Press ofAmerica.

14. United Nations Development Programme (UNDP) on Energy and Environment, 2008. Sustainable Energy retrieved on 05/05/2008 from http://www.undp.org/energy/

15. United Nations Environment Programme (UNEP) on GEO-3: Global Environment Outlook, Integrating Environment and Development: 1972 to 2002 retrieved on 06/05/2008 from http://www.unep.org/GEO/geo3/pdfs/Chapter1.pdf

16. United Nation Framework Convention on Climate Change (UNFCCC), Kyoto Protocol to the United Nation Framework Convention on Climate Change, United Nations, 1998   retrieved on 14/4/2008  from http://unfccc.int/resource/ docs/convkp/

/kpeng.pdf

17. United Nations Framework Convention on Climate Change (UNFCCC), COP13: Revised draft decision -/CP13 Ad Hoc Working Group on Long-term Cooperative Action under the Convention, Bali, 2007 retrieved on 23/05/2008 from http://unfccc.int/ files/

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data/ghg_data_from_unfccc/time_series_annex_i/items/3814.php

 

 

 

Present Indian Energy Scenario- Challenges and Options

D C Srivastava


 

As we all know that energy is one of the most important inputs required for economic and social development of the nation. Therefore, commensurate growth of about 5-6% in the requirement of commercial energy in the form of electricity and fossil fuels would be necessitated to meet the projected economic growth rate of about 8%. Though India ranks sixth in the world so far as total energy consumption is concerned, but it still needs much more energy to keep pace with its developmental needs as its per capita energy consumption is about 45% that of china, about 4% that of US and one fifth of the world average.  Though the present installed capacity of power generation has increased to 1,23,018 MW from a meager value of about 1,600 MW at the time of independence, but still peak power shortages of about 12% and energy shortages of around 7% exists due to continued demand growth. Per capita electricity consumption is about 606 Kwh that is again about one fifth of world average.

 

If we take a look at energy supply mix of India we find that about 38.7% of total energy supply is met from non commercial energy sources like agro waste, firewood, dung etc and renewable. As far as fossil fuels are concerned coal, oil and gas contributes about 33.1%, 22% and 4.2% respectively in total energy supply mix. However, hydro and nuclear power contribute about 1% and 0.9% respectively.

 

If we look at the fossil fuels, then coal continues to be the principal source of commercial energy accounting for nearly 50% of total supplies. Even more than 70% of the power generated is based on coal and lignite and this trend is likely to be continued in foreseeable future. Present capacity of coal based thermal power plant is about 67,688MW. The geological coal reserve of India is estimated to be about 220.98 billion tones (bt) as on 2001. Out of this, indicated reserves and inferred reserves are 98.55 bt and 38.02 bt respectively. While proven coal reserves of India is about 84.41 billion tonnes that may last for about 200 years at current level of production to reserve ratio. About 6% of total domestic consumption of coal is met through import of coking and non-coking coal for steel and cement industries and costal coal based power plants.

 

As far as estimated recoverable reserve of oil is concerned, it is estimated to be about 734 million tonnes as on 2001. Indigenous production of crude oil is approximately 33.981 million tones against demand of about 127.114 million tones. About 73% of oil demand is met through imports. At current level of production to reserve ratio known oil reserves of the country    may last for about another 22 years.

 

As far as gas is concerned known recoverable gas reserves as on 2001 are around 750 billion cubic meters (BCM).  Natural gas production of India is around 31.774 BCM. Therefore, known natural gas reserves of the country are likely to be depleted within next 24 years at the current rate of production. The total installed gas based power generation capacity is about 12,171 MW.

 

 India is endowed with economically viable hydro potential that has ability to store energy and flexibility of its use during peak load period. Estimated hydropower potential of India is around 1,48,700 MW of installed capacity, out of which about 31,865 MW capacities has been installed and about 4,865 MW are at various stages of development.

 

Nuclear power has the potential to meet the future needs of electricity demand in the country. India has developed the capability to build and operate nuclear power plants observing international standards of safety. The current installed capacity of nuclear power plant is 3,310 MW, which is likely to be augmented to about 10,000 MW by 2011-12. 

 

India is endowed with abundant natural and renewable resources of energy like sun, wind and biomass etc.  India has approximately a potential of  45,000 MW of wind power, 19,500 MW of biomass-based power, 15,000 MW of small hydropower and 1700 MW of waste to energy. Apart from this solar energy has a potential of 20 MW/sq. km and tremendous energy resources are there in the form of firewood, biogas and dung etc. Total installed capacity of power generation from renewable is 6,158 MW. India has made an impressive growth in field of wind energy by augmenting installed capacity of about 3,000 MW. Installed capacity of small hydropower plant is 1,693 MW and about 488 MW capacities are under installation. Installed capacity of waste to energy is about 46.50 MW.

 

In addition to coal, substantial reserve of coal bed methane (CBM) exists in the country which needs to be efficiently exploited to supplement our energy supplies. Hydrogen is another alternative source of energy, which holds the potential to provide a clean, reliable and affordable supply of energy. However, a lot of R&D activities are required to develop technologies for economic and safe production, storage, distribution and end use of hydrogen energy.    

 

The future strategies for nuclear power programme may focus on three stages for the optimal utilization of available nuclear energy resources. The first stage is to be based on pressurized heavy water reactor (PHWR) using indigenous natural uranium resources. The second stage is to be based on fast breeder reactor (FBR) technology using plutonium extracted from spent fuel of the first stage. In the third stage, country’s vast thorium resources may be utilized for power generation.

 

In the present energy scenario India is importing about 30% of its total commercial energy supplies in the form of oil, coal and even electricity in order to meet its ever increasing energy demand which is a matter of concern from energy security point of view. The present installed capacity of power generation has increased to 1,23,018 MW and around 21,186 MW capacities are under execution at various stages. Despite this a large chunk of population living in rural areas does not have access to preferred commercial energy like electricity, gas and oil etc that poses a major challenge for present and future.

The effort to eliminate the gap between the availability and demand of energy continues by adding the capacity of energy production and supply. But, in addition, there is also a substantial scope of energy saving in our economy without foregoing any end-use benefits through efficient use and elimination of wasteful expenditure of energy that would immensely supplement the effort in reducing the gap between demand and supply of energy. Energy savings achieved through energy efficiency and conservation will also lead to achieve the goal of providing affordable energy to all. 

Energy savings achieved through energy efficiency and conservation are highly cost effective and environmentally benign options compared to additional energy supply capacity creation. The services provided by energy in the form of appropriate light, heat, motion and cooling effect etc is more important rather than the amount of energy consumed itself. Therefore, the approach in all the energy consuming activity is to be shifted from “energy input” to the “effectiveness of the energy use” and  “energy services”.

Therefore, realizing the vast potential of energy savings through energy efficiency and conservation, Energy Conservation Act, 2001 was enacted and the Bureau of Energy Efficiency as an apex regulatory body under Ministry of Power was set up to coordinate energy efficiency measures at a national level.  

Though India is continuously reducing its energy intensity by improving energy efficiency, but still a vast potential exist for further improvement. Energy Efficiency and conservation is one of the best options available to reduce the gap between demand and supply of energy. Various strategies have been built on the provisions of E C Act, 2001 to promote energy efficiency in the various sectors of economy in the country.

 

The first most important sector is industrial sector that consumes nearly 50% of commercial energy. There is a wide variation in the energy consumed per unit of products or services produced among various consumers in the same sector using similar technologies. Potential consumers of energy or energy intensive consumer may get the energy audit of their activities conducted by an Energy Auditor who will advise for switching over to commercially viable energy efficient technologies, equipment and practices.

There is a wide variations in the energy consumed in various equipment and appliances of similar capacity of different make. There is a need to fix a Minimum Energy Performance Standard (MEPS), so as to prohibit manufacture, sale, purchase, trade or import of selected equipments or appliances that do not conform to MEPS.

 

In absence of information to the consumer about the energy efficiency of equipments or appliances, many consumers keep on buying energy inefficient products despite their preferred choices for energy efficient products. Suitable Energy Efficiency Rating of the product may be displayed in form of Label on selected equipments and appliances so as to enable the consumer to make a informed choice for purchases.

 

There is a lot of potential of energy conservation in buildings especially in commercial buildings. Energy Conservation Building Code is to be prepared for various climatic zones of India for commercial buildings having high energy consumption that can be amended by the State Government to suit regional and local climatic changes. The code may cover energy efficiency aspect of the building pertaining to heating, ventilation, air-conditioning, lighting, electric power distribution and service water heating and pumping system consistent with prevalent Indian Standard (IS) and Building Bye-laws.

 

To bring about attitudinal and behavioral changes in the society, it is necessary to introduce the concepts of energy conservation and efficiency to the masses effectively through print and electronic media

 

Potential consumers of energy and bulk distributor of energy like coal, gas, electricity etc. may spend a small amount of their budget towards creating energy conservation awareness among their employees, among nearby community or among their customers. In addition utilities can undertake energy efficiency and DSM programme.

 

Major barrier to wide spread use of energy efficient technology is its high cost at initial stages due to expenditure on R&D, up gradation of manufacturing facilities, market promotion activities and increased input material cost coupled with low volume of production. Therefore selected energy efficient equipment and appliances may be provided financial incentives in form of various tax benefits over a certain period of time.

 

There are many industrial and commercial units that do not possess technical and financial capabilities to audit, evaluate and implement energy efficiency measures. Energy Service Companies           (ESCOs) can be promoted who can invest in energy efficiency project of their customer and can share the revenue earned through energy savings as per mutually agreed terms and conditions.  

 

The Financial Institutions and Banks may create and earmark a fund to finance energy efficiency improvement project on easy and attractive terms and conditions.

 

The industries and establishments that excels in energy efficiency and its conservation need to be publicly recognized through various awards at the Organisation, the State and National level so that others could be motivated to emulate the same.

 

A cadre of Certified Energy Professionals can be created to cater the needs of energy audit and its implementation required by various industries and other organisations.

As far as supply side mangement is concerned energy efficient technologies like IGCC and CCGT etc needs to be inducted in power generation. Similarly transmission and distribution losses need to be tackled with appropriate technology and practices.

 

Major portion of electricity is generated through heat obtained from combustion of coal, and gas  etc and made available to consumers for use  through transmission and distribution networks. A significant amount of energy is lost in conversion process that is unavoidable. Therefore, wherever it is possible to use heat energy in significant quantity, heat obtained from burning fuel should be used directly if it is not restricted by safety, productivity, process controllability, quality and any other requirements.

Substantial amount of money is spent on import of petroleum. High quality rapid transit system for public transport may reduce energy cost per passenger per kilometer in big urban cities.

 

Town planners while developing a new area may plan the residential, commercial, institutional, office areas and other amenities in such a way that traveling requirements of the people residing in that area could be reduced to great extent which in turn will lead to reduced consumption of petroleum.

 As every one is involved in consumption of energy in some form or other, the mission of achieving energy efficiency and conservation will be fulfilled if each and every one is committed to this cause through widespread use of energy efficient equipment, appliances, technologies and practices in all the energy consuming activities. Energy efficiency and conservation measures are beneficial for individual in terms of reduced energy bill, for nation in terms of reduced dependence on import of energy resources and are also environmentally benign. Adoption of energy efficiency measures will help to a great extent to extend access to energy at affordable price to a large population.

 

 Published in rPoceedings of All India Seminar on Emerging Trends in Energy Coservation and Management Organized by The Institution of Engineers (India), Roorkee Local centre, Roorkee (India) on November, 11-12,2005 Roorkee (India)

Pricing of LPG and Kerosene in India and its implications for socio-economic development

Energy prices always have considerable bearing on vote-bank politics not only in India but in many countries across the world. Though government intervention in market to control price or quantity leads to various kinds of inefficiecies and associated cost that is finally passed on to consumers, and alternately,if item is subsidised, the same is passed on to government. However, political parties and in turn government are not only interested in efficiency , but in equity also, in order to make life of people better by providing access to basic energy needs at affordable price especially to economically weaker sections of society who constitute a sizeable vote-bank also. About half of the population especially in rural area do not have access to  electricity, and also to a large extent to other commercial energy for lighting their homes and cooking that adversely impacts their socio-economic development and especially health and education of women and girls in rural areas. In such a scenario, Kerosin and to some extent LPG for household consumption qualify for subsidy. Alternately, other mechanism can be put in place to provide kerosin and LPG subsidy directly to consumer and free the market even for LPG and Kerosine. 

 

 

Will deregulation in oil sector in India benefit consumers?

As far as energy is concerned it is an important input for social and economic development and it should be made continually avalable to all strata of society at affordable and stable price. Unfortunately about 80% of oil requirement and considerable amount of gas supply now is met through imports. Since first oil crisis in 1973-74, international price of crude oil have been volatile and large fluctuation in price over a short perid of time have been observed on account of various reasons such as manipulation by OPEC, lack of adequate investment in exploration, refining and downstream activities etc. 

For vibrant oil and gas market, it is essential that adequate investment take place in exploration, acquisition, extraction oil and gas; and building up adequate infrastructure in storage, transportation and marketing. To achieve the same, oil and gas companies need to generate adequate surplus to invest, and this can be achived if oil and gas companies run efficiently on professional lines with adequate freedom to generate reasonable profit and surplus for reinvestment. Moreover, there should be in built mechanism in government policy to incentivise generation of more profit through efficient operation as well as reinvestment in this sector.

Having said above, it must be realized that oil and gas market is yet not a really competitive market, where large numbers of buyers and sellers exits. In this market, a few powerful sellers and very large numbers of unorganised buyers are there. In an unregulated market, it is quite likely that few numbers of sellers may form cartel and exploit exorbitantly consumers especially when elasticity of demand for oil and gas is low and prices of crude oil in international market is volatile. Through regulation of price government tries to insulate all economic activities from shock of sudden price rise of crude oil in international market protecting industry and commerce apart from meeting the obligations of meeting the demand in social sector. In such a situation it should be need of hour to strike a balance between autonomy for oil and gas companies to determine the price of their products and ensuring availability of oil and gas to consumers at a relatively stable and affordable price.

Out of the four products i.e. petrol, diesel, LPG, and kerosine that are entitled for subsidy, petrol does not merit any subsidy at all, rather it is promoting private transport in place of public transport and serves better the interest of local as well MNCs engaged in manufacturing of two wheelers and four wheelers passanger vehicles. This class of consumers can absorb the shocks of oil price rise.

As far as diesel is concerned a sizeable amount is used in agriculture, public transport and goods transport. As far as public and goods transport is concerned, it can be recovered by tranporters or government can give subsidy in other forms such reduction of excise duty on public transport and goods transport system or reduction of service tax, road tax etc. As far as subsidy for agriculture sector is concerned same could be addressed through minimum support price by goverment for prominent agricultural produces. With agriculture and public transport sector, private diesel passenger vehicle owners are also enjoying the fruits of subsidy, though they do not deserve the same. In such situation, it would be appropriate to dismantle subsidy on diesel provided concerns of agriculture sector is addressed properly either through minimum support price or subsidised coupons or through some innovative mechanis of upcoming new UID scheme.

As far as LPG is concerned, it is predominantly used in urban areas with relatively better paying capacity and therefore, subsidy can be reduced. There need to be rationing on LPG and subsidy can be provided on rationed portion of LPG that will also encourage efficient use of LPG in cooking. The arrangement could be that first cylinder could be subsidised and second cylinder in the same month or a given period of time could be at market rate.

As far as kerosine oil concerned, it is used by economically weakest section of society for lighting purpose, and to some extent for cooking purpose also. Any reduction in subsidy will badly affect the education, health in poor section of society and especially it will more adversly affect women and girls as they would spend quality time in gathering biomass and cooking in unhealthy environment, if they do not have access to kerosine. Therefore, it need to be ensured that poor section society is not deprived from use of kerosine for lighting and cooking purpose, and if direct subsidy on kerosine is to be dismantled it should be ensured that adequate monetary subsidy is given to eligible families to meet their requirements of kerosine through some robust mechanism which does not have chances of leakage and misuse of this subsidy for other purpose. Perhaps UID scheme would come with such a provision that if a subsidy say is given for fertilzer it could be used for fertizer only and not for electricity . If such a robust system is developed in UID , a lot of leakages of subsidised kerosine for other purpose can be checked. 

These measures would reduce the burden of subsidies on oil companies and would improve the productivity and profit that can be further invested in oil and gas sector to make it more stable. This may also cost of oil gas reducing the need for subsidy. However, government must put in place a mechanism that unreasanble price is not charge fron non-subsidised consumers through cartel formation by oil and gas companies to protect the economy and non subsidised categories of consumers. However, utmost care need to be taken by government to make avalable BPL families at least kerosine and if possible rationed LPG also. However subsidies should be borne by government and not alone by oil and gas companies.

 

Cost auditing of petroleum to regulate its pricing

There are few oil and gas companies in India and they appear to behave in oligopolistic manner. There is wide variations in cost of oil and gas in PPP ( purchase power parity) terms among oil and gas importing countries. This leads to apprehension among many consumers in India that either these companies are running inefficientlty or charging hefty and unreasonable profit. Therefore, there is a need to carry out indepth cost audit of oil companies involved in this business from exploration to marketing and distribution by an independent and competent NGO so that truth could surface out. Based on these facts only policy decision about free market, APM or subsidised cost on all ranges of petroleum products should be decided. Having said above we should not blindly believe on what OPEC says, because OPEC also does not have clean record as far as manipulation of international crude prices are concerned .

 

 

Decontrol fuel prices

Government should decontrol the prices of petrol , diesel and LPG without any hitch. Poor section of society like farmers , and BPL households and similar other may be given financial subsidy for diesel and LPG etc based on merit. This will lead to fair market mechanism in oil and gas market, efficiency in use of energy resources. As far as kerosene is concerned, social equity is more important than efficiency, hence adequate subsidy should be provided keeping in view a large population of poor people in country who are entirly dependent on this form of commercial energy only for meeting their cooking and lighting requirements. 

 

Changing dynamics of gas pricing

Perhaps quick transition from APM to market driven pricing mechanism would not work smoothly in this context. Private investment in gas exploration and extraction is at infancy stage in India. It needs to be further strengthen. For this to achieve, reasonablble return on investment in gas sector by public and private players have to be ensured. As different sources of gas such as on source, off source and imported LNG would have different cost implications, therefore, at supply side all the individual resources need to be priced at cost plus basis by independent regulator and then pool it . These pooled resources can have common pooled price and quantity can also be allocated to different priority sector as per policies of government. Subsidies if any to be given can be borne by government for a particular sector. Rest can be sold at common pooled price. It can derive also analogies from electricity market, where there are similar technical limitations. 

 

Proactive policy for an efficient gas market

Perhaps quick transition from APM to market driven pricing mechanism would not work smoothly in this context. Private investment in gas exploration and extraction is at infancy stage in India. It needs to be further strengthen. For this to achieve, reasonablble return on investment in gas sector by public and private players have to be ensured. As different sources of gas such as on source, off source and imported LNG would have different cost implications, therefore, at supply side all the individual resources need to be priced at cost plus basis by independent regulator and then pool it . These pooled resources can have common pooled price and quantity can also be allocated to different priority sector as per policies of government. Subsidies if any to be given can be borne by government for a particular sector. Rest can be sold at common pooled price. It can derive also analogies from electricity market, where there are similar technical limitations. 

 

Environmental implications of bottled water versus tap water

A study needs to be carried out on environmental implications on incresing use of bottled water versus tap water. Because increasing trend of consumption of bottled water has an adverse impact on environment on account of associated CO2 emmission in manufacturing of bottle, its transportation; and disposal of bottle has many other hazards on environment. Moreover, increasing use of bottled water put  a lot of pressure on scarce petroleum resources in production of bottle, its transportation. Though use of bottled water can not be totally eliminated, but its consumption can be definitely brought down to a great extent reducing cost of water and more so its impact on environment. However, a lot of investment is needed in potable water supply infrastructure to ensure clean water especially in developing country. Even supply of tap water with proper distribution network and dispensing mechanism could be considered on commercial basis in big cities and towns where floating population is high. There could be many innovative business model that could be put in place. In time of global recession, investment in  state of art tapped water supply infrastructure development right from water treatment to distribution may also play a significant role in fighting recession to some extent and creating an infrastructure in drinking water that is environmently benign and good for health of public. 

Geo-political Implications of Solar Power

There is no doubt that solar energy has a very bright future vis-a-vis fossil fuels. If we compare technological growth, efficiency improvements and cost reduction in computer and telecom technologies with  solar power technologies over about last half a century, we find a big gap, though all the three technologies fall in the same technology domain, if we exclude the energy storage systems requirements. It appears that technologies for solar power generation was purposely held back by a big few to serve the interests of few interest group at individual as well asat  nation level. Thanks to china for taking a lead in popularising this technology by making cheap solar power panels that has already made  solar power cheaper than diesel generator based electric power.

Prominence of solar power may change the geo-political situation around the world as many covert as well as overt conflicts and wars have taken place for fossil fuel especially oil in last century and same will be continued in future also as many non democratic regimes have thrived on and for fossil fuels. As solar power has been more democratically distributed unlike fossil fuels, so it has more potential to propagate democracy. Moreover, development of solar power will also save us from scourge of global warming and climate change.