JUST ENERGY TRANSITION PARTNERSHIP
WHY IN NEWS ?
Recently, Indonesia submitted Plan on How it Will Spend $20 Billion on Clean Energy Transition.
WHAT IS JET-P?
- JET-Ps are a nascent financing cooperation mechanism ,the aims of which are to help a selection of heavily coal-dependent emerging economies make a just energy transition.
- “Just Energy Transition Partnership” (JET-P) was announced for the first time at the 26th UN Climate Change Conference of the Parties (COP 26) in Glasgow.
- The goal is to support these countries self-defined pathways as they move away from coal production and consumption while doing so in a way that addresses the social consequences involved, such as by ensuring training and alternative job creation for affected workers and new economic opportunities for affected communities.
ISSUES IN ENERGY TRANSITIONING
- Energy transitions could give rise to intragenerational, intergenerational, and spatial equity concerns.
- Transitions affect near term fossil dependent jobs, disrupt forms of future energy access, shrink State’s capacity to spend on welfare programmes, and thus exacerbate existing economic inequities between coal and other regions.
- JET-Ps pay limited attention to intragenerational inequity, such as job losses resulting from a coal phasedown.
INDIA AND JET-Ps
- The energy transition in the industrialised world involves a natural tapering of energy consumption alongside fuel switching to clean energy sources.
- In case of India, it’s transition requires significant simultaneous growth in energy demand.
- India is likely to multiply its energy demand requires adequate supply from a diverse mix of sources of energy.
- India cannot afford to put its development on hold while decarbonising.
- Thus, India must develop a coherent domestic just energy transition (JET) strategy in order to negotiate a financing deal that addresses its unique set of socioeconomic challenges.
As India has signalled a commitment to clean energy with ambitious targets like 500GW of non fossil, including 450 GW renewable energy (RE) capacity addition and 43% RE purchase obligation by 2030.
Such targets are supported through mechanisms like:-
- Complementary policy and legislative mandates (Energy Conservation (Amendment) Act)
- Missions (National Green Hydrogen Mission)
- Fiscal incentives (production linked incentives) and market mechanisms (upcoming national carbon market).
Such interventions show India’s serious efforts at energy transition, but additional supplementary measures are needed for a coherent JET strategy.
STEPS FOR INDIA’S JUST ENERGY TRANSITIONS
- GROWTH IN RENEWABLE ENERGY : Acceleration in renewable energy (RE) deployment rates to match the pace of demand growth is critical to India’s JET. While good news is that While RE deployment has outpaced coal in recent years. In 2021-22, coal power served one third of the new demand.
Despite sustained efforts India missed its 2022 target for 175 GW RE capacity. The gap is largely in decentralised deployment, which is more promising for acceleration.
HOW TO ACCELERATE INDIA’s RENEWABLE ENERGY DEPLOYMENTS ?
- Shifting energy demand patterns in ways that enable faster RE capacity addition by :
- Solarisation of agricultural electricity demand
- Electrification of diesel powered Micro, Small and Medium Enterprises (MSMEs)
- Decentralised RE for residential cooking and heating.
- Stimulation of energy demand through rural productivity enhancement will further aid RE acceleration as well as help to address the Rural-urban economic divide, create rural jobs, and thereby address intergenerational and spatial inequities.
- Domestic manufacturing of clean energy components is critical to sustain a JET, build energy self sufficiency, and tap the green jobs promise of 21st century energy.
- The challenge is in achieving cost competitiveness as Indian components are 20% costlier than Chinese components.
- Also giving preference to domestic components without addressing cost competitiveness may slow down the pace of deployment.
- Thus, the best way around is to negotiate access to markets outside India as part of a JET Partnership and to reduce the cost gap through economies of scale.
- These measures will not only address equity concerns across various dimensions but also create new job opportunities, achieve emissions reduction and prepare the country for deeper decarbonisation through a future coal phasedown.
- JETPs should serve as a beacon to the wider investment community that participating governments are committed to a global clean energy transition.
- Any future JET-P deal must consider this broader framework for financing and supporting an energy transition.
- With India holding the G20 presidency, it has an opportunity at hand to negotiate a deal for itself while also shaping international cooperation on just energy transitions.
SYLLABUS: GS-3, MAINS, ENVIRONMENT
SOURCE : THE HINDU