Gains of accelerating net zero

In earlier articles, we proposed an acceleration of India’s net-zero greenhouse gas (GHG) emissions goal from 2070 to 2047. We discussed India’s unique GHG profile, the grave dangers of blowing our carbon budget, the importance of the agricultural and electricity sectors, and how we could go about tackling such a challenging goal.

In this concluding article, we will discuss why we should even attempt such a journey. And what is the return on the $3.4 trillion (or 1% of GDP) required? Not surprisingly, the top 10 reasons relate to the economic well-being and health of the country and its citizens.

First, India’s gross domestic product (GDP) is the fifth largest in the world, having just passed the UK. India’s economy is projected to show strong annual growth of about 6% between now and 2047, resulting in a GDP of $26 trillion, which would be number three in the world at that time behind China and the US. To get there, India needs a few sectors of hyper-growth, and cleantech is one. Estimates show that by the mid-2030s, 20 million good-quality clean energy jobs will be created, replacing about 10 million fossil fuel jobs that will be lost. By pursuing net-zero acceleration, additional GDP growth of about 7 percent by 2032 and lasting effects of 3 percent until 2060 are projected.

Second, the added economic activity and employment will yield additional governmental income, allowing progressive investment in faster decarbonisation and other programmes.

Third, the country’s balance of trade will benefit tremendously from avoiding the import of crude oil and liquefied natural gas (LNG), as well as potential exports of cleantech goods and services that technical leadership in this space will buy. Low-carbon-footprint goods and services will enhance competitiveness due to the upcoming Cross-Border Adjustment Mechanism that requires carbon accounting of all exports. In addition, the average household will experience a significant reduction in expenditure on energy, contributing to a higher quality of life.

Fourth, energy independence is accompanied by significant geopolitical benefits. India’s economy and inflation will be much better insulated from externalities like regional conflicts, petropolitics, and oil embargoes.

Fifth, decarbonisation is accompanied by a reduction in particulate pollution and, therefore, cleaner air, reducing the rates of asthma, emphysema, and even cancer. India suffers from 1.6 million deaths per year due to air pollution, and almost 25% of air pollution deaths worldwide occur in India. The health benefits of decarbonisation are significant and will lead to higher productivity, a higher life expectancy, and health care savings, together valued at an estimated 3.3% of GDP.

Sixth, the avoided cost of climate mitigation and adaptation could be huge. The cost of recovering from severe storms is rising. Crop failures from drought are extremely expensive for the country. Sea-level rise can drive huge expenditures on building sea walls and artificial mangroves. Dealing with climate-induced migration will become a pressing issue. On the other hand, accelerating net zero will reduce future adaptation costs, enhance biodiversity, and preserve freshwater.

Seventh, any energy use that is electrified begets efficiency benefits. For example, electric vehicles are 3–4 times more efficient than their internal combustion counterparts. Heat pumps are 4 to 5 times more efficient than furnaces for heating and twice as efficient as traditional air conditioners.

Eighth, the unattractive economics of fossil fuels will be avoided. One-third of all fossil fuels are used to mine, refine, and transport fossil fuels, all of which will be avoided. Worldwide fossil fuel subsidies of $7 trillion annually can be directed to better ends.

Ninth, a fully renewable and reliable grid implies oversizing of generation capacity so that abundant, cheap “super power” is available much of the time. This will lead to industrial growth and a higher quality of life for ordinary citizens.

Tenth, the coming energy transformation is the perfect opportunity to ensure a just and equitable transition, whereby economic benefits and abundant energy accrue to those who need it most. We estimate that India’s acceleration of net zero to 2047 will yield a tenfold return on investment. For these reasons and many more, India should not be a laggard in environmental matters and quite simply cannot afford not to accelerate its net-zero ambitions.

(Visweswariah is VP, cure100.org, and Muralidharan is an R&D specialist, IIT Madras. This is the last in a series of seven articles on the topic of climate change and net zero)