Editorial 1. India’s just energy transition is more than a coal story
Context:
Just Energy Transition Partnership (JET-P) is emerging as the key mechanism for multilateral financing by developed countries to support an energy transition in developing countries. This has taken on particular significance following the insertion of the phrase ‘phase-down’ of coal in the Glasgow Pact.
Issues that concern transitions
After South Africa, Indonesia, and Vietnam, India is considered the next candidate for a JET-Partnership. India’s G-20 presidency could potentially be an opportune moment to forge a deal. However, India must develop a coherent domestic just energy transition (JET) strategy in order to negotiate a financing deal that addresses its unique set of socio-economic challenges. So, what would a JET strategy for India look like?
Energy transitions could give rise to intra-generational, 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.
Existing JET-P deals, pay limited attention to intra-generational inequity, such as job losses resulting from a coal phase-down. However, among the three JET-P deals signed so far, only South Africa’s deal mentions a ‘just’ component — funding reskilling and alternative employment opportunities in the coal mining regions — to be financed as part of the initial $8.5 billion mobilisation. The other two JET-Ps ( Indonesia and Vietnam) are focused on mitigation finance for sector-specific transitions.
Initial JET-P negotiations for India last year have reportedly remained stalled over whether and how India should consider coal ‘phase-down’ and how to operationalise India’s just transition. The emphasis by developed countries’ on coal phase-down, without adequate attention to country context, disregards the crucial difference in energy transition between industrialised and emerging economies.
Energy transition in the industrialised world involves a natural tapering of energy consumption alongside fuel switching to clean energy sources; India’s transition requires significant simultaneous growth in energy demand.
Central Electricity Authority (CEA) projects a near doubling of electricity demand by 2030. A country that is likely to multiply its energy demand requires adequate supply from a diverse mix of sources. India cannot afford to put its development on hold while decarbonising.
(India’s energy mix)
The path to a clean energy quest
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.
These targets are supported through 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). These interventions show India’s serious efforts at energy transition, but additional supplementary measures are needed for a coherent JET strategy.
Here are three sets of actions that could further expedite India’s energy transition while also addressing domestic developmental priorities, and justice and equity concerns.
First, acceleration in RE deployment rates to match the pace of demand growth is critical to India’s JET. While RE deployment has outpaced coal in recent years, in 2021-22, coal power served one-third of the new demand.
Meeting India’s 2030 target requires accelerating non-fossil capacity addition from 16 GW a year in 2022 to 75 GW a year by 2030, a 22% year-on-year growth. 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.
Two complementary paths are suggested to accelerate RE deployment that can have significant developmental co-benefits.
- A low-hanging option is shifting energy demand patterns in ways that enable faster RE capacity addition: solarisation of agricultural electricity demand; electrification of diesel-powered Micro, Small and Medium Enterprises (MSMEs); and 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 inter-generational 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. While India has recognised the importance of domestic manufacturing, the challenge is in achieving cost competitiveness — Indian components are 20% costlier than Chinese components. Giving preference to domestic components without addressing cost competitiveness may slow down the pace of deployment. The way around this is to negotiate access to markets outside India as part of a JET-Partnership, to reduce the cost gap through economies of scale.
On coal use
Third, there is a case for re-aligning the current use of coal resources to enhance efficiencies until the period of phase-down. One option is to optimise use of coal-fired power plants closer to where coal is mined rather than based on energy demand in States.
This would enable coal to be used more efficiently because transportation of coal is more energy-intensive than transmission of electrons, and also lead to fewer emissions. It would also lead to cheaper power, as transportation accounts for one-third of the cost of coal for power plants; the resultant savings could also help finance much needed emission control retrofits. Finally, and not least, it would indirectly reduce emissions due to more efficient use of coal.
Moreover, by using coal more efficiently, this policy shift opens the door to India considering a future cap on coal-powered generation capacity. Current generation capacity plus plants in the pipeline are adequate to meet India’s projected requirement in 2030. Low capacity utilisation factor (58% in 2022) further allows the possibility of greater use of existing plants to match future demand.
By leading to cheaper and more efficient power, the coal re-alignment proposed here helps address energy security concerns, making it possible to even consider a future coal-based power capacity cap.
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 phase-down.
Conclusion:
However, as has been stressed by many, the investment requirements for this transition are beyond the means of domestic mobilisation for developing countries. Any future JET-P deal must consider this broader framework for financing and supporting an energy transition. With India holding the G-20 presidency, it has an opportunity at hand to negotiate a deal for itself while also shaping international cooperation on just energy transitions.
Editorial 2. Empowerment through Higher Education
Context:
The All India Survey on Higher Education (AISHE) 2020–21 highlights some interesting trends in the growth of the tertiary sector in recent years.
All India Survey on Higher Education (AISHE):
To portray the status of higher education in the country, the Union Ministry of Education (MoE) has been conducting an annual web-based survey called AISHE since 2010-11. These are useful in making informed policy decisions and research for development of the education sector.
Data is being collected on several parameters such as teachers, student enrolment, programmes, examination results, education finance, infrastructure.
Indicators of educational development such as Institution Density, Gross Enrolment Ratio, Pupil-teacher ratio, Gender Parity Index, Per Student Expenditure will also be calculated from the data collected through AISHE.
Findings of AISHE 2021 Report:
- At a macro level, the growth in the number of students enrolled in higher education more than doubled to 7.3%, taking the total number of students to 4.1 crore. The 2.1 crore male students only a little more than the 2 crore females. Thus, the overall share of female students has edged closer to the halfway mark and reached 48.7%.
- However, the inclusion of students from the disadvantaged social groups remains far from satisfactory. Trends for the last five years show that while the overall share of the Other Backward Classes (OBC) in the total number of students has increased by 1 percentage points to 35.9%, the increase in the share of Scheduled Tribe (ST) students to 5.8% was even smaller.
- Worse still, the share of Scheduled Caste (SC) students stagnated at 14.3% over the period, while that of the Muslim students declined marginally to 4.7%. These increasing disparities across social groups are a major setback which should be immediately remedied.
- Surprisingly, it is the female students that are faring better on the higher education front than the males among the major disadvantaged groups. The numbers show that the share of female students in higher education now exceeds that of the males among ST students with their share touching 50.6% and among Muslim students it is a remarkable 50.2%. The 49.2% share each of female SC and OBC students are also higher than the overall national average.
- However, despite these gains on the gender front across almost all major social groups, the disparities in overall enrolment rates across social groups, continue to widen. In 2020–21, while the overall enrolment in higher education was 27.2%, that of the SC students was only 23.1%. In the case of STs the enrolment rate was still a lower 18.9%.
Two positive aspects stand out even in this sombre scenario:
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The female enrolment rates were higher than that of males across all these segments. More importantly, the female enrolment rates of all social groups are now increasing faster than that of males, very often at double the pace of the latter.
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But the most striking achievement on the higher education front is that the gender parity has now been sustained for four successive years, with the gender parity index (GPI) hovering around 100 during the period, during the period.
And these gains on the gender front were extensive with the number of major states achieving gender parity going up from 11 to 17 over the last five years. And the number of states failing to achieve gender parity has halved to half a dozen over the period.
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Gender Parity Index (GPI) is a socioeconomic index usually designed to measure the relative access to education of males and females. In its simplest form, it is calculated as the quotient of the number of females by the number of males enrolled in a given stage of education (primary, secondary, etc.). The closer a GPI is to one, the closer a country is to achieving equality of access between males and females
GPI= 1 signifies equality between males and females. GPI<1 signifies that gender parity favors males GPI > 1 indicates gender parity that favors females. |
Gross enrolment rate (GER)
Despite the commendable performance on achieving gender parity in higher education, the development of the sector remains highly skewed with the gross enrolment rate (GER) varying substantially across the states. The data for 2016–17 show that the GER in the best-performing states was four times higher than that in the worst-performing states. Though the level of disparity has come down to around threefold by 2020–21, they are still far too high for comfort.
Another disquieting feature was the sharp difference in the pace of improvement in GER. Between 2016–17 and 2020–21, the GER improved by above 10 percentage points in Uttarakhand and Kerala and in the 5–10 percentage point range in the states of Karnataka, Madhya Pradesh, and Rajasthan. On the other hand, the improvement in GER was the least in the states of Uttar Pradesh, Assam, and Odisha, where it was less than 1% during the period. In fact, GER even declined in Punjab over these years.
Conclusion:
These huge disparities in higher education call for concerted measures to extend the gains on the gender front across disadvantaged social groups and the laggard states. Only such efforts can ensure a more inclusive growth in a knowledge economy. Another major challenge is to provide decent employment to the growing number of educated female students and reverse the falling female labour force participation rates.