The greening of India Inc

According to reports, a total of 146 countries have submitted what post-2020 climate actions or Intended Nationally Determined Contributions (INDCs) they intend to undertake in the run-up to the United Nations Conference of the Parties (COP 21) in Paris scheduled from November 30 to December 11. India, in its much anticipated INDCs, has committed to reducing the emissions intensity of its GDP by 33-35 per cent by 2030 from the 2005 level.

Increasing the share of renewables to 40 per cent of installed capacity from its current share of 13 per cent by 2030 is envisioned to act as one of the primary catalysts towards achieving this target.

Further, enhancing forest and tree cover to create an additional carbon sink of 2.5 to 3 billion tonnes of CO2 equivalent is also one of the key highlights of the INDCs.

It is estimated that $2.5 trillion will be required to meet India’s climate change actions between now and 2030, which would require the pooling of resources from myriad stakeholders, including India’s corporate sector.

The INDCs have been formulated keeping in view the already defined targets and policy reforms of the government, particularly in the realm of renewables and energy efficiency — the 175 GW renewables target by 2022, and Phase 2 of the Perform, Achieve, Trade (PAT) Scheme in energy efficiency, to name a few.

However, it is interesting to note that a new paradigm has evolved in the climate change debate. Indian businesses are getting proactive in implementing climate-friendly initiatives as well as accelerating R&D in low carbon solutions; this is either as a part of companies’ Corporate Social Responsibility (CSR), voluntary measures, core business operations, or under various government schemes.

Ficci’s recent report titled Industry Perspectives on INDCs and Corporate Initiatives on Climate Change Mitigation and Adaptation in India, released last month, analysed a range of climate change mitigation and adaptation initiatives implemented by companies across various sectors, such as power, oil and gas, iron and steel, chemicals, and pharma.

The report highlights how leading companies across key sectors in the country are implementing a breadth of initiatives including renewable energy generation (for example, on building rooftops), energy efficiency improvements (waste heat recovery in steel plants), resource conservation (water recycling and use), and waste minimisation (usage of alternative fuels in brick kilns) to achieve carbon emissions reduction and improve the overall sustainability of their operations.

The Indian cement industry, despite being one of the most polluting sectors, has emerged as a frontrunner in terms of implementing low carbon measures. The industry believes that such initiatives could be scaled up further with schemes to promote co-processing of waste, and waste heat recovery systems.

The study revealed that a majority of the companies have been largely focusing on reducing their energy consumption (and subsequently cost) by targeting specific key energy-intensive processes and operations.

Under their CSR obligations, they are also showcasing their climate responsibility by adopting a range of measures; these include improved agro-forestry techniques, off-grid lighting, rainwater harvesting, access to clean drinking water and so on, in the process reducing the carbon footprint and generating livelihood opportunities.

The question, however, is how to mobilise efforts from a range of stakeholders, including the government and the international community, to scale up these interventions.

First, India needs to work with the international community at the COP 21 to devise frameworks for market-based approaches, such as voluntary emissions trading schemes, that can help companies realise their climate change goals. Realigning policies in such a way that they attract CSR funding into climate-friendly initiatives should also be a key consideration.

For example, State action plans on climate change (SAPCCs) could specify key sectors such as water and sanitation, sustainable agriculture, energy access, etc, where corporate involvement could come into play.

Second, it is essential to bridge existing knowledge gaps in terms of innovative and scalable models of climate change mitigation and adaptation that could be implemented under CSR. This is where multilaterals alongside industry organisations such as Ficci could play a role in bringing diverse and often disparate sets of stakeholders under one roof.

Third, designing public-private-partnerships (PPPs) could be one of the ways to route sustainability and CSR resources towards low carbon projects. For instance, businesses could collaborate with parliamentarians to implement projects that address issues related to energy, water and sanitation, and health under the Sansad Gram Yojana.

It is also important to consider how the private sector facility under the Green Climate Fund (GCF) could be leveraged as part of broader efforts to scale up climate-relevant financial flows.

There is a need to explore pooling CSR resources into innovative financing products such as social impact bonds and green bonds.

Long-term conducive policies are essential to provide businesses with the confidence to plan and invest in a range of low carbon technology options.

The role of the international community in providing models of scalability, financing mechanisms and technology provision, would be paramount.

Source : Panchabuta, November 1st 2015

URL : http://panchabuta.com/2015/11/01/the-greening-of-india-inc/

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