Energy and Climate Change Mitigation in India: Development, Technologies and Stabilization GTSP Technical Review May 23, 2007 JGCRI, College Park, MD 20740 USA P.R. Shukla Indian Institute of Management, Ahmedabad, India
Agenda Drivers of Energy and Emissions Base Case Projections Low Carbon Society (with Sustainable Development) Stabilization (with Carbon Interventions)
Drivers of Energy and Emissions and Base Case Projections
Population and GDP 1,800 $45 1,600 $40 Billions 1,400 1,200 1,000 800 600 $35 $30 $25 $20 $15 Thousand $/capita (2000$) 400 200 0 Population GDP/Capita 1990 2005 2020 2035 2050 2065 2080 2095 $10 $5 $0
Demographic Transitions in India Age group 100+ 95-99 90-95 85-89 80-84 75-79 70-74 65-69 60-64 55-59 50-54 45-49 40-44 35-39 30-34 25-29 20-24 15-19 10-14 5-9 0-4 Male Population in 1970 1970 Female Age group 100+ 95-99 90-95 85-89 80-84 75-79 70-74 65-69 60-64 55-59 50-54 45-49 40-44 35-39 30-34 25-29 20-24 15-19 10-14 5-9 0-4 Male 2010 Population Projection for 2010 Female 50 40 30 20 10 0 10 20 30 40 50 70 60 50 40 30 20 10 0 10 20 30 40 50 60 70 Population (million) Population (million) Age group 100+ 95-99 90-95 85-89 80-84 75-79 70-74 65-69 60-64 55-59 50-54 45-49 40-44 35-39 30-34 25-29 20-24 15-19 10-14 5-9 0-4 Male Population Projection for 2030 Female Age group 100+ 95-99 90-95 85-89 80-84 75-79 70-74 65-69 60-64 55-59 50-54 45-49 40-44 35-39 30-34 25-29 20-24 15-19 10-14 5-9 0-4 Male Population Projection for 2050 2030 2050 Female 70 60 50 40 30 20 10 0 10 20 30 40 50 60 70 70 60 50 40 30 20 10 0 10 20 30 40 50 60 70 Population (million) Population (million)
Demographic Transitions in India: Urban/Rural Urban & Rural population of India 90 Rural Urban 80 70 60 50 % Share 40 30 20 10 0 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 Year
Population and Working Age Population Population (Million) Annual Growth Rate of Population 1800 1600 1400 1200 1000 800 600 400 200 358 555 849 1183 1449 1593 2.50% 2.00% 1.50% 1.00% 0.50% 2.22% 2.15% 1.67% 1.02% 0.47% 0 1950 1970 1990 2010 2030 2050 0.00% 1950-70 1970-90 1990-2010 2010-30 2030-50 Labor Supply Annual Growth Rate of Labor Supply 1000 800 600 400 200 133 210 360 595 795 915 3.00% 2.50% 2.00% 1.50% 1.00% 0.50% 2.30% 2.74% 2.54% 1.46% 0.70% 0 1950 1970 1990 2010 2030 2050 0.00% 1950-70 1970-90 1990-2010 2010-30 2030-50
Human Capital R&D Technology Other Drivers of Growth Government Expenditure in Education Private Expenditure in Education Urban / Rural & Gender-wise Education Expenditure (Net) Migration by Labor Classes (intra & inter county) Government/ Private Expenditure Knowledge Flows Backbones (infrastructures) Learning, transfers, deployment Saving/ Investments Governance Social Security Lifestyles, Behaviors Institutions Laws Policies 40 35 30 25 20 15 10 5 0 20.60 22.80 Savings Rate 24.60 31.50 33.00?? 35.00 30.00 26.00 1980 1990 2000 2010 2020 2030
India s s Economic Growth: GDP Projections 700 600 Very High Base Year 2005=1 500 400 300 200 CAGR 2005-50 A - 8.69% B - 7.85% C - 6.88% D - 5.95% CAGR 2050-100 A - 5.41% B - 5.67% C - 5.69% D - 5.29% High Medium 100 Low 0 2005 2015 2025 2035 2045 2055 2065 2075 2085 2095 2105
Changing Structure of Energy Use 80% Percentage of Primary Energy Consumption 60% 40% 20% 0% Fuel Supply? Waste disposal? Safety? Nuclear 1952 1960 1970 1980 1990 How to transit to Modern Biomass? Food Security? Traditional Biomass En. Security: +Ve 2001 Coal Oil Domestic Resource: +ve Direct Employment: +ve Energy Security: -ve Foreign Exchange: -ve Geopolitical Risk: High Gas Foreign Exchange: -ve Hydro Regional water disputes? Indirect Benefits
Trillion Kwh/yr 3.00 2.50 2.00 1.50 1.00 0.50 Electricity Wind; Solar; Hydro; Other renewable Nuclear Biomass Natural Gas Coal Oil 0.00 2005 2010 2015 2020 2025 2030 2035
EJ/yr 60.00 50.00 40.00 30.00 20.00 Renewables Nuclear Hydro Gas Coal Oil Primary Energy 10.00 0.00 2005 2010 2015 2020 2025 2030 2035
Carbon Emission (by Fuel) 1.200 GtC/yr 1.000 0.800 0.600 0.400 Coal Natural Gas Oil 0.200 0.000 1990 2005 2010 2015 2020 2025 2030 2035
Low Carbon Future through Sustainable Development: An Analysis for India
Low Carbon Society (LCS) in Developing Country context? LCS is a Development Pathway which: a. facilitates achievement of the national socioeconomic objectives and targets, b. while contributing to the achievement of global objectives and targets for stabilization of greenhouse gas concentrations in the atmosphere, c. in a cost-effective and sustainable manner.
Low Carbon Society (LCS) Scenario Drivers of India s LCS Scenario (550 ppmv equivalent) Carbon Emission Target (70% reduction over Base Case in 2050) Energy Device Efficiency Targets (Demand/ Supply-side) Dematerialization Building Materials and Design Reduce (demand), Recycle & Reuse (3R) Materials Infrastructure investments Avoid lock-ins Shift demand (e.g. transport modal split) R&D and Technology Transfer Leapfrog (to the efficiency frontier) Innovations (to shift the efficiency frontier) Planning & Governance Facilitate change in Lifestyles & Behaviors Institutions, Laws, Policies
Low Carbon Society: Scenario Development for India Key areas for interventions: Demographics Lower Population Growth (e.g. investment in women s education) Higher investment in social infrastructures (e.g. health, education) Conservation Efficient technology, Substitutions, Recycling, Pricing, Dematerialization City Planning Architecture/ Building Codes; Land use policies; Public Transport Infrastructure choices R&D, technology transfer and selective technology push Incentives for environmental industry Influencing consumer preferences/ behavior
How sustainable development policies influence LCS? E.g. Education, Employment and Productivity nexus Policies for public private partnership higher (public and private) investments in education Increases supply of education services Incentives for education for women and socially and economically backward sections enhances demand for education Women s education reduces fertility rates & this together with family planning campaigns lead to lower population (than in reference & some others cases) The increases in labor participation rates and enhanced skill profiles maintains labor supply and higher productivity in next few decades Rural development policies (including education, employment, infrastructure push and reduced risk for investments) break through the rural/ urban dualism (Likewise for other drivers, the sustainability scenario story differ)
Low Carbon Society Roadmap Innovations (APEIS/SDB) Technological Social/Institutional Management National Socio-economic Objectives and Targets Low Carbon Society Co-benefits Sustainability Aligning Markets Win/Win Options Shared Costs/Risks Long-term Vision Avoid Lock-ins Global Climate Change Objectives and Targets Modify Preferences Specifics of the roadmap would differ across countries. What is important is to communicate transparently the qualitative story and its quantification (i.e. modeling)
Carbon Emissions: Base vs. LCS Scenario for India India s Cumulative Carbon Emission from 2000-2050 Mitigation Billion Ton of CO 2 Reference Scenario: 127.2 LCS Scenario: 64.3 Cumulative Mitigation in LCS: 62.9 % Cumulative Mitigation in LCS: 49.5% % Mitigation in LCS in 2050: 70.0%
Mitigation in LCS Scenario for India 4057 2050 Base Scenario Mitigation in LCS (in 2050) Electricity (Supply + T&D Efficiency) 745 Buildings (Materials/Design) 384 Million Ton of CO 2 1284 1032 2050 LCS Emission: 1217 (70% Mitigation target in 2050) Renewable Energy Device Efficiency Material substitutions Recycling Reduced Consumption Urban Planning Transport (Modal shift) Transport Infrastructure Total CO 2 Mitigation 328 274 207 173 90 265 272 102 2840 2000 2006 2050
Mitigation through dematerialization in LCS Scenario Dematerialization in LCS vis-à-vis Base Scenario is contributed by multiple direct and indirect policies, most of which belong to the policy packages relating to sustainable development. Change in building materials and design contribute significantly to dematerialization and energy efficiency in construction In addition, three other key contributors to mitigation through dematerialization are: Mitigation (MT CO 2 ) in 2050 Material Substitutions 207 Reduced Consumption 173 Recycling 90 Materials Demand in Base vs. LCS Steel Cement Base Base LCS LCS Fertilizer Paper Energy and carbon intensive materials - of which the substitutions and reduced consumption contribute most to mitigation in the LCS scenario - are steel, aluminum, cement, fertilizer and paper. Recycling reduces the energy and carbon intensity of the materials, besides delivering environmental co-benefits. Base LCS Base LCS
SO 2 Mitigation Co-benefits of LCS Scenario Joint Mitigation (Period 2007-2050) Mitigation Regime Co-benefits SO 2 mitigation alone in Reference Scenario SO 2 Co-benefit in LCS Scenario Little carbon mitigation LCS policies generate benefits equivalent to 30% lower SO 2 in 2050 and cumulative saving in SO 2 Emissions Reduction equivalent to $11.2 billion over period 2006-2050
Modeling Climate Stabilization Induced Development Paths
Centralizatio n Indian Carbon Emissions Scenarios 1800 Carbon Emissions Indian Emissions Scenarios 1600 IA2: Reference Scenario Governance Decentralization IA1 Market Efficiency IB1 Integrated Sustainable Development Market integration IA2 Fragmented Hybrid Economy (Reference) IB2 Self Reliance Closed Economy CO 2 Emissions (MT) 1400 1200 1000 800 600 400 200 2000 IA1: Market Efficiency IB1: LCS Scenario 2020 2040 2060 2080 2100 India s Total Carbon Emission in 21 st Century (Billion Ton CO 2 ) Reference (IA2) Scenario : 363 Market Efficiency (IA1) Scenario Sustainable Development (IB1) Scenario : 286 (79% of IA2) : 198 (55% of IA2)
Technologies in Low Carbon Scenarios: Long-term Conventional Technology Paths Synfuels, Gas hydrates, Nuclear fission Fuel cell vehicle: Carbon-free hydrogen Energy efficient appliances/ infrastrucutre 6750 6000 Frozen Technology IA2 CO 2 Capture/ Storage, pipeline networks 5250 IB2 Nuclear Fusion, Backstops CO 2 Emissions (Million Ton) 4500 3750 3000 2250 1500 750 2000 2020 2040 2060 2080 2100 IA1 IA1T IB1 Information highways, High speed trains Advanced materials, Nanotechnology High share of renewable Energy Renewable Lifestyle changes, Energy Eco-friendly Technologies choices Substitution of transport by IT Dematerialization, material substitutions Sustainable habitats, Public amenities
Indian Emission Scenarios and Stabilization Carbon Emissions for Indian Scenarios 7 6 IA2 CO 2 Emissions (Billion Ton) 5 4 3 2 IA1 IB1 India s Total Carbon Emission in 21 st Century (Billion Ton CO 2 ) Reference (IA2) Scenario : 363 Market Efficiency (IA1) Scenario Sustainable Development (IB1) Scenario : 286 (79% of IA2) : 198 (55% of IA2) 550 PPMV Global Regime (LCS India) : 140 (39% IA2) 1 550 ppmv (LCS) 2000 2020 2040 2060 2080 2100
Stabilization to 2 O C from LCS Scenario 4057 2050 Base Scenario Mitigation in LCS (in 2050) Electricity (Supply + T&D Efficiency) 745 Buildings (Materials/Design) 384 Million Ton of CO 2 1284 1032 LCS Emission: 1217 2 0 C Stabilization: 1069 Renewable Energy Device Efficiency Material substitutions Recycling Reduced Consumption Urban Planning Transport (Modal shift) Transport Infrastructure CCS Total CO 2 Mitigation 328 274 207 173 90 265 272 102 148 2988 2000 2006 2050
Conclusions High Growth Asian Developing Economies require sophisticated representation of drivers in New Scenarios Base Case Projections for India will require significant mitigation even in low growth scenarios Low Carbon Society (LCS) scenario assuming technology/institutional innovations and win-win (co-benefit) opportunities can deliver substantial low cost mitigation Even low emissions scenarios (including LCS scenario) would require exclusive carbon mitigation interventions for stabilization (e.g. 2 O C or 450 ppmv)