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Analysis

If India meets renewables target, no more coal power needed till 2027

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Solar Power in India

As the prospects for coal-generated electricity recede globally, India is one of the last bastions of the world’s oldest, dirtiest energy source–coal–although construction of new coal-fired power plants is faltering.

From January 2016 to January 2017, development of coal-fired power capacity fell around the world–pre-construction activity dropped 48%, start of construction fell 62%, ongoing construction fell 19%, and the number of completed projects fell 29%, according to a March 2017 report, Boom and Bust, released jointly by the Sierra Club (a US-based environmental non-profit), Greenpeace (The Netherlands-based environmental campaigning non-profit) and Coalswarm (an online repository on coal).

Using data from the Global Coal Plant Tracker, an online database developed by Coalswarm that identifies, maps and categorises every known 30-MW and larger coal-fired power generating unit and every new unit proposed since January 1, 2010, the report maps a global move away from coal and towards renewable energy.

In China and India alone, construction activities that would add 68 GW–over a fifth of India’s total installed capacity–of additional coal capacity are frozen across 100 project sites, 13 of them in India. The primary reason for the slowdown in India is “reluctance of banks and other financiers to provide further funds”, the report said. Over half (56.5%) of India’s installed power capacity will be non-fossil fuel-based–renewables, nuclear & large hydroelectric–within 10 years, as IndiaSpend reported on April 19, 2017.

In India, as of February 2017, at least 15 coal-based thermal power projects with an aggregate capacity of 18,420 MW (18.42 GW) were stalled due to financial reasons, the power ministry told the Lok Sabha (lower house of Parliament) on February 9, 2017.

Source: Global Coal Plant Tracker;  as of January 2017

NOTE: Announced: Project has appeared in planning documents but not moved forward by applying for any permits.
Pre-permit: Project has actively moved forward in one or more ways: Applying for environmental permits, acquiring land, coal, water rights and/or transmission arrangements, or securing financing.
Permitted: Project has secured all environmental permits but not broken ground.
Under construction: Site preparation and other activities underway.
Shelved: Project no longer moving forward, but not enough evidence to declare it cancelled.
Cancelled: The utility has announced a project cancelled; or the project has disappeared from company documents; or the plant shows no activity over a period of four years. Projects that switch to natural gas are considered “cancelled” as coal plants.
Operating: Project has entered commercial operation.

However, in March 2017, the Cabinet revived some struggling power projects with a cumulative capacity of some 30 GW under a new Mega Power Policy by providing support of about Rs 10,000 crore to the sector, in addition to incentives such as custom duty waiver for import of capital equipment and tax breaks. This was done to relieve the burden of stressed assets on banks, estimated at Rs 1.5 lakh crore, according to this report published in the Times of India on March 31, 2017.

“The slowdown in the coal power pipeline brings the possibility of holding global warming to below 2°C from pre-industrial levels within feasible reach,” the Boom and Bust report stated. However, this hinges on countries such as Vietnam, Indonesia, Turkey and Japan limiting their future coal power development, China and India reinforcing and increasing the slowdown, and developed countries (historically largest emitters) retiring coal-based power plants faster than they have been doing.

To restrict global temperature rise to 1.5°C, the report said, an immediate doubling of the current pace of retirement would be needed, meaning plants as young as 20 or 30 years would have to be retired even though the average lifespan of a coal plant is 40 years.

India does not plan on expanding its coal-fired capacity during 2017-22, according to the Draft National Electricity Plan proposed in December 2016 by the Central Electricity Authority. It bases this projection on the presumption that non-fossil fuel capacity addition will continue as targeted–4.3 GW of gas-fired plants, 15 GW of hydroelectric plants, 2.8 GW of nuclear installations and 115 GW of various renewable sources, which would come online during 2017-22.

The plan, however, does take into account 50 GW of coal-based installations that are currently under different stages of construction and are likely to yield benefits during the 2017-22 period, concluding that no coal-based capacity addition is required until at least 2027, as IndiaSpend reported on April 19, 2017.

Can renewables replace coal?

In 2015, India accounted for 7% of total global emissions, lower only than China (29%), the United States (14%) and the European Union (10%), according to this 2016 joint report by PBL Netherlands Environmental Assessment Agency and the Joint Research Centre of the European Commission. In the same year, the share of coal-fired power plants in India’s total CO2 emissions was just short of half at 47%, the report said.

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NOTE:*Data as of February 28, 2017

Source: Central Electricity Authority

In 2016-17, India’s estimated peak demand of 165.2 GW was significantly lower than total installed capacity of over 300 GW. Coal-fired capacity of over 180 GW alone was higher than the peak demand. Despite this, the country continues to face acute power shortages due to coal supply problems, transmission and distribution losses and poor health of power utilities.

According to government figures, estimated electricity consumption between 2005-06 and 2014-15 increased by a compounded annual growth rate of 8.72%, growing to 948,328 gigawatt-hour, even as an estimated 240 million Indians are still without access to electricity.

Already, use of imported coal is costing the country. In 2014-15, India’s coal imports were 212 million tonnes (MT) and cost over Rs 1 lakh crore–up more than five times from 38.5 MT in 2005-06, due largely to poor quality of domestic coal, lack of competition among producers, and insufficient investments.

On the other hand, investing in renewables brings environmental benefits like reduced pollution while creating employment opportunities, as IndiaSpend reported on January 28, 2017. Therefore, renewable energy has the potential to solve the energy trilemma of ensuring energy security, energy access and sustainability, according to this 2015 report by the National Institution for Transforming India (NITI Aayog).

Challenges ahead

To capture the benefits of renewable energy (RE), the NITI Aayog report said, “India would need to make available the necessary capital, and get comfortable with managing the variability and uncertainty of RE generation in conjunction with the existing and planned fossil fuel-based and large power plants”.

Tariffs for renewables in India, especially solar, have fallen heavily–by 73% since 2010. In February 2017, at the Rewa solar park auction, a levelised tariff of Rs 3.3/kilowatt-hour was achieved, competitive with the cost of new coal-fired power generation. Wind tariffs, too, fell to a record low of Rs 3.46/unit in the same month. The jury is out on whether these low tariffs are sustainable, but the trend is undoubtedly positive for renewables.

 

India would also need to invest in smart grid systems, storage options and demand-side flexibility to manage the variability of renewables.

The building of a green energy corridor, along with renewable energy management centres, will prove vital for evacuation of power between states, since solar and wind power potential is concentrated in a few states–nine states are expected to account for more than 77% of renewable energy capacity addition by 2022. Yet, progress on this has been slow, with pace of construction not keeping up with the speed at which projects are being commissioned, according to this analysis by Mercom Capital Group, a private consulting firm.

“Grid integration is possible provided efforts are made by the government towards integrated resource planning for power sector keeping renewables as the focus,” Deepak Gupta, Senior Program Manager for Power at the Shakti Sustainable Energy Foundation, a New Delhi-based not-for-profit, told IndiaSpend.

Gupta said policy-makers would need to strengthen the Electricity Act, 2003, which governs the generation, distribution, transmission and trading of power in India, to specifically integrate renewables. Else, India should have a separate Renewable Energy Act, he said, adding, this will help the government expand its focus from renewable energy generation to a well-rounded integration of renewables with the country’s energy system.

(In arrangement with IndiaSpend.org, a data-driven, non-profit, public interest journalism platform, with whom Mukta Patil is an analyst. The views expressed are those of IndiaSpend. Feedback at [email protected])

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Analysis

Trump’s decision to cut troops in Afghanistan creates policy vacuum

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New York: President Donald Trump’s decision at his administration’s sunset to pull back US troops from Afghanistan and Iraq is among his final attempts to keep his original campaign promise, but creates a policy vacuum and complicates the transition to Democrat Joe Biden in January.

Acting Defence Secretary Christopher Miller’s announcement that the US troop strengths in those two countries would be reduced to 2,500 each by January 15 – just five days before Biden takes over – creates a policy vacuum there.

Miller said on Wednesday, “In the coming year, we will finish this generational war and bring our men and women home.”

The war that began in 2001 to root out the Al-Qaeda that carried out the 9/11 attack on the US, and the Taliban than allowed to operate from Afghanistan, has claimed about 2,350 US lives and left more than 20,000 wounded.

Trump had promised in his 2016 campaign to bring all US troops home.

The troops remaining in Afghanistan and Iraq are to defend the US diplomatic and other facilities there.

There was a confluence of views between Trump and some Democratic leaders and opposition from Republicans and the NATO.

The House of Representatives Armed Services Committee Chair Adam Smith, a Democrat, said, “Reducing our forward deployed footprint in Afghanistan down to 2,500 troops is the right policy decision. At the same time, this reduction must be responsibly and carefully executed to ensure stability in the region.”

But the committee’s Republican leader Mac Thornberry warned Trump, “These additional reductions of American troops from terrorist areas are a mistake.”

“Further reductions in Afghanistan will also undercut negotiations there; the Taliban has done nothing – met no condition – that would justify this cut,” he added.

The peace agreement with the Taliban, which was seen as a precondition for troop withdrawal, has yet to materialise and the terrorist group has continued attacks in Afghanistan.

“The price for leaving too soon or in an uncoordinated way could be very high,” NATO Secretary-General Jens Stoltenberg said in Brussels.

He warned that Afghanistan risks becoming again the centre of international terror with the Islamic State (ISIS) moving there to rebuild “the terror caliphate it lost in Syria and Iraq.”

While Biden has committed to end the “forever wars in Afghanistan and the Middle East” and to “narrowly focus our mission on Al-Qaeda and ISIS,” neither he nor his transition team has reacted to the preemptive move by Trump.

Trump’s action would make policy-making and implementation difficult as soon as he takes over. It is compounded by him and his transition team being cut out of briefings and denied access to officials and information.

As vice president, Biden had been sceptical of his President Barack Obama’s troop surge in Afghanistan, when the force-strength was increased from about 30,000 when he assumed office in 2009 to nearly 100,000 in about a year as he attempted to decisively crush the terrorists in hope of a pull out.

Pakistan has been a key figure in the region, playing all sides. It has benefited from the US invasion of Afghanistan after the 2001 attacks on the US the Al-Qaeda, which was protected by the Taliban and Islamabad, which gave that group’s leader Osama Bin Laden asylum.

Pakistan Prime Minister Imran Khan visited Kabul for the first time on Thursday, a day after the US announced the troop cutback, but according to reports did not say anything about it.

The US-backed Kabul government has been suspicious of and critical of Pakistan for its backing of the Taliban.

But now President Ashraf Ghani will have to come to terms with Islamabad, which had facilitated the peace between the Taliban and the US, with nominal participation of the Kabul government in the process.

As the patron of the Taliban, Khan will wield more direct influence over Afghanistan as Washington winds down its involvement.

But on the other hand, when the US involvement is minimised and troops are no longer active beyond the protection of US resources, Islamabad’s leverage is also reduced because US troops would no longer be vulnerable to cross-border terrorism and terror attacks by Pakistan’s proxies and therefore will not have to be deferential to it.

Nor would Islamabad be able to exert influence by manipulating Taliban diplomacy.

The danger for Pakistan and the world will be the rise of the ISIS in an Afghan vacuum. Islamic State’s Khorasan Province (ISIS-K) group has been a threat to both Afghanistan and Pakistan and Islamabad will have to contain it and similar groups for its own protection – and not make a deal with them lest it face a backlash from the US.

There has been no signs of opposition in the Pentagon to the troop withdrawal.

After Miller took over the defence portfolio when Trump fired Secretary Mark Esper days after the November 3 election there has been a change in personnel at the top level to douse dissent.

(Arul Louis can be reached at [email protected] and followed on Twitter at @arulouis)

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Analysis

American democracy loses when most popular candidate is kept from race twice

Sanders’ popularity is now recognized, but after he spelt out the scenario on October 23 in a talk show on how the drama will unfold when votes are counted in these elections, he is well on his way to being prophetic.

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Bernie Sanders

It was nice to receive mails from friends who had assembled at Lucknow boy Nusrat Durrani’s Dumbo apartment under the Brooklyn Bridge on November 3, 2016, election night, armed with champagne bottles to be uncorked as soon as Hillary Clinton pipped the post.

In the event, the champagne bottles stood in one straight line on the dining table like a row of brooding bishops. Trump had shocked all the guests. A submarine sandwich hurled as a missile by a despairing guest knocked the lamp over.

I have repeated the above story because that is what history is supposed to be — a continuous repetition of facts. So indelibly etched on my mind is that party in Brooklyn that every US election will bring alive that episode.

There is another reason for that episode to be so etched on my mind. I did not wish to be the only one out of sync with the general mood that evening, but I was in a minority of one who expected Hillary to lose. Having arrived in New York a fortnight ago for a discussion in the various campuses of my book, ‘Being the Other: The Muslim in India’, kept me away from a 24X7 bombardment of punditry on elections.

A cluttering of detail tends to push out of focus the simple, plausible outline conditioning of electoral behaviour. Experience from most electoral theatres had taught me a simple lesson: people were tired of two parties, one indistinguishable from the other.

This was happening at local levels too, even in India. The Aam Aadmi Party’s record 67 out of 70 seats in 2015 was one such wave, smothered by the media which is controlled by the corporates whose key projects in New Delhi were threatened by the untried party. It did not have the ideological spine to withstand the assault from the main political parties and the corporate media. Therefore, the bubble burst. AAP is now an ordinary party circling around power.

There are comparisons between Joe Biden scraping through and Hillary Clinton losing in 2016: neither were popular candidates. They were candidates that the Democratic Party “manoeuvred” as front-runners because on both occasions Bernie Sanders was the most popular candidate, but his democratic socialism was anathema to the establishment.

As soon as it became clear that Sanders was leading the field, the establishment came out, all guns blazing. Thomas Friedman, whom the New York Times values as its star columnist, forgot all decencies of independent journalism and wrote two full columns rooting for former New York Mayor, Michael Bloomberg and a billionaire several times over, as one of the Democratic front-runners. There was no hope in hell that Bloomberg would win (buy) the nomination but, by spending a billion on TV, he would disrupt the game sufficiently for Sanders to advance. “This is a capitalist country,” thundered Bloomberg. To protect his credibility, Friedman admitted in his column, that his wife worked for one of Bloomberg’s charities. This was just one of the umpteen tricks employed to obstruct Sanders.

There was a straightforward reason why Clinton was the wrong candidate. The velocity given to globalization after the Soviet collapse gave a fillip to rampaging capitalism. Inequalities broke all barriers. It did not require Thomas Piketty to enlighten as that even in India barely one per cent of the rich had cornered 51.53 per cent of the wealth. The picture in the US was worse. Occupy Wall Street became a popular movement. It invited a capitalist riposte — the Tea Party. People were disgusted with Washington, which symbolized the US establishment. A quest began for an anti establishment candidate. Just one such candidate appeared to be Bernie Sanders. People were looking for social welfare, universal healthcare, education — exactly what the Bloombergs of the US thought would kill the initiative which made America great. Quite unabashedly, the Democratic Party gave the impression that it was preferable to lose the White House than lose corporate support.

One hoped the shock reversal of 2016 would have taught the Democrats a lesson. Across the Atlantic, Jeremy Corbyn was being likewise thwarted by New Labour. One of their leading lights, Lord Peter Mandelson, had sworn to “undermine” Corbyn. The other day they suspended him. Corbyn was to Mandelson what Sanders was to Bloomberg. This in June 2017 when the latest opinion polls projected Corbyn as the possible Prime Minister. Another example that the establishment trumps the popular will. Whither democracy, then?

At this very time, another reality was allowed to go unnoticed. A Fox News poll showed that Sanders has a +28 rating above politicians on both sides of the political spectrum. At that time, the Guardian’s Trevor Timm wrote, “One would think with numbers like that, Democratic politicians would be falling over themselves to be associated with Sanders, especially considering the Party as a whole is more unpopular than the Republicans and even Donald Trump right now. Yet, instead of embracing his message, the establishment of the party continues to resist him at almost every turn, and they seem insistent they don’t have to change their ways to gain back the support of huge swathes of the country.”

Sanders’ popularity is now recognized, but after he spelt out the scenario on October 23 in a talk show on how the drama will unfold when votes are counted in these elections, he is well on his way to being prophetic.

“In states like Pennsylvania, Michigan, Wisconsin, and elsewhere, Republicans are likely to go to the polling booths to cast their votes. Democrats, are likely to mail in their votes. When counting begins, the votes counted first will be Republican votes for that reason. So, by 10 pm on counting day, Trump will thank his voters and announce victory. But next morning when millions of mails will be counted, the trend will change. That is when Trump will scream murder: I told you they’ll cheat.” Mayor Rudi Giuliani has already elaborated the case in Philadelphia.

(Saeed Naqvi is a senior commentator on political and diplomatic issues. The views expressed are personal. He can be reached on [email protected])

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Analysis

The US presidential elections and future of India-US relations

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Donald Trump Joe Biden

As the coronavirus pandemic dominates global news in the United States, progress toward the next presidential election scheduled to be held on November 3 moves slowly forward. President Donald Trump had no real opposition in the Republican party and is running for re-election. And it has now become apparent that former Vice President Joe Biden will be his opponent as the Democratic candidate for president.

What would a Trump victory bode for the future of US-India relations? What would a Biden victory bode? Let me answer each of those questions in turn.

Given the love fests of Prime Minister Narendra Modi’s ‘Howdy Modi’ event in Houston, Texas, in which Trump participated in September of 2019, and Trump’s ‘Namaste Trump’ event hosted by Modi in India in February of this year, it might be assumed that the future for US-India relations is a splendid one. This would be an incorrect assumption.

Both of these events were more symbolic than substantive. Trump’s participation in them undoubtedly helped to persuade some — perhaps many — Indian American Modi supporters who voted for Hillary Clinton in 2016 to cast their ballots for Trump in 2020. Trump’s campaign team took steps to ensure this by holding an event at his Mar-a-Lago resort in which a group of prominent Indian Americans announced their plans to work for his re-election and to mobilize Indian Americans on his behalf.

To understand the future potential of India’s relations with the US. with Trump as president, however, it is necessary to look beyond these political moves and to examine the present state of those relations and Trump’s personal style.

In a word, the best way to characterize the current relations between the US and India is “functional”. The relationship was relatively good for the first two years of Trump’s presidency. In fact, near the end of 2018, Alice Wells, the Acting Assistant Secretary of State for South and Central Asia, was quoted in the media s saying: “This has been a landmark year for US-India ties as we build out stronger relationships across the board.”

Then, in 2019, the relations went off the track in the first half of the year after the US and India got into a tit-for-tat tariff war after the US terminated India’s Generalized System of Preferences which allowed India to send certain goods to the US duty-free. There have been continuing efforts to structure a “modest” trade deal since then. It was thought there might be some type of deal done in September of 2019 while Modi was in the US by year’s end, and then during Trump’s India visit. But, as of today, there is still no deal.

This inability to get any meaningful trade agreement in place speaks volumes about India’s potential future relations with India with Trump as president. So, too does Trump’s style.

Trump’s campaign slogans this time around are “Keep America Great” and “Promises Made, Promises Kept.” Trump is not a policy wonk and most of his effort will go toward “America First”. This involves making the US more isolated by withdrawing from international agreements, restructuring trade agreements, emphasizing building walls to stop immigrants at the border, using tariffs to block trade with countries who are taking away American jobs, and confronting businesses who are allegedlly stealing American trade secrets.

This perspective suggests what India can expect for its relations with the US if it has to deal with Trump for a second term as president. The relations will stay functional at best. As I have said before, that’s because the words partnership, cooperation and collaboration are not in Trump’s vocabulary. Nationalism, isolationism and protectionism are.

Joe Biden stands in stark contrast to President Trump both professionally and personally. Biden is a strategic thinker and doer with a solid eight-year track record of leadership experience as Vice-President in forging alliances that have made a difference around the world and he has also been a long-standing friend of India.

He was chairman of the Senate Foreign Relations Committee and a leading advocate for the Congressional passage of the Indo-US civic nuclear deal in 2005. At a dinner convened 10 years later in 2015 by the Confederation of Indian Industry and the Carnegie Endowment for International Peace, Vice President Biden discussed the tremendous joint progress that had been made by the two countries in the past and declared “We are on the cusp of a sea change decade.”

Early in his campaign for the Democratic nomination for president in July of 2019, in laying out his foreign policy vision, Biden stated that the US had to reach out to India and other Asian partners to strengthen ties with them. The items on Biden’s foreign policy agenda for strengthening which are of importance for India include climate change, nuclear proliferation and cyberwarfare.

During his vice presidency, Biden worked side by side with President Barack Obama to do things that would contribute to achieving Obama’s vision stated in 2010 of India and America being “indispensable partners in meeting the challenges of our time.” In 2020, those challenges are even greater than they were a decade ago.

That is why it is so essential that India and the US develop a strategic relationship that enables them to become those indispensable partners. That can happen if Biden assumes the presidency on January 20, 2021. It cannot happen if Donald Trump remains as president for a second term.

The results of this upcoming election in the US matter greatly for the future of the United States. They matter greatly for the future of India-US relations as well. Time and the American electorate will tell what that future will be.

(Frank F. Islam is an entrepreneur, civic and thought leader based in Washington DC. The views expressed here are personal)

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