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Paper

Pathways Towards India’s Nationally Determined Contribution and Mid-century Strategy

Vaibhav Chaturvedi, Poonam Nagar Koti, Anjali Ramakrishnan Chordia
March 2021 | Low-Carbon Pathways

Suggested citation: Chaturvedi, Vaibhav, Poonam Nagar Koti, and Anjali Ramakrishnan Chordia. 2021. “Pathways towards India’s nationally determined contribution and mid-century strategy.” Energy and Climate Change, no. 2: 100031

Overview

This paper discusses a scenario-based uncertainty assessment conducted to explore India’s potential to enhance the mitigation ambition of its energy sector-related nationally determined contribution (NDC) targets, and to inform long-term decarbonisation. It highlights that renewable energy integration costs and the decarbonisation of industrial energy use will pose key challenges for India’s long-term decarbonisation strategy. The novelty of the study lies in its characterisation of key uncertainties and the insights it derives by assessing their implications. It uses one business-as-usual or reference (Ref) scenario and 222 others to model the uncertainty span around the Ref results by exploring sensitivities related to economic growth, urbanisation rate, electricity generation technology cost and other variables.

Key Highlights

  • India is well on the path to exceed its target of a 40 per cent share of non-fossil sources in its electricity generation capacity by 2030 and has room to enhance it. But in the long run, the level and impact of potential integration costs of solar and wind penetration need to be understood better.
  • There is also significant progress towards its target of achieving a 33 per cent reduction in the emissions intensity of its GDP by 2030, but this is sensitive to developments in the industrial sector. Before enhancing this target, India needs to better understand variables such as the rate of industrial energy efficiency improvements and the share of electricity in industrial energy use.
  • Air conditioning has major impacts on the climate system: the direct emissions of refrigerant greenhouse gases and the indirect emissions from the combustion of fuel to power the equipment.
  • Power sector reforms will be critical for the decarbonisation of India’s electricity generation as well as its industrial energy use.
  • India can demonstrate leadership by adopting a peaking year for its power sector emissions as part of its mid-century strategy. In doing so, it would be taking on an additional burden to help the world reach its target of a global average temperature increase of “well below 2 degrees Celsius”.

Key Recommendations

  • Reform retail power pricing structure and eliminate cross subsidy in retail power prices.
  • Adopt a new market design to ensure renewable energy is not penalised due to existing incentive structures in the sector.
  • Promote grid-connected distributed energy.

India is well on the path to exceed its 2030 target of a 40 per cent share of non-fossil sources in its electricity generation capacity, and has room to enhance it.

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