Budget: Hydrogen mission outlay shows India’s green commitment, says TERI chief
The Union Budget 2023-24 may help India not only to achieve its global climate commitments but shift all sectors to adopt energy transition and sustainable practices, said Vibha Dhawan, director general, TERI
The Union Budget 2023-24, presented by finance minister Nirmala Sitharaman with focus on clean and green energy, may help India not only to achieve its global climate commitments but shift all sectors to adopt energy transition and sustainable practices, Vibha Dhawan, director general, The Energy and Resources Institute (TERI), tells Jayashree Nandi in an interview. Edited excerpts:
The 2023-24 Union Budget has put great emphasis on ‘green growth’ and energy transition. What do you think of it?
I would have been surprised if the phrase ‘green growth’ did not appear in the finance minister’s speech as many times as it did. The PM (Narendra Modi) made climate commitments in Glasgow based on certain presumptions and also the need of the hour. We are already late in taking action on climate crisis. Its impacts, uglier than expected, are already being felt in India. As a country, India has to develop and that also puts us in a unique position… In the Budget, it was emphasised that we have to develop and at the same time go green. Our net-zero goal for 2070 is not very far. Decarbonisation is dependent on multiple factors and not just transition of industries, such as e-vehicles, insulating homes, electricity generation and usage, lifestyle. The finance minister spoke of green finance, green mobility, green buildings, green energy… the allocation to the National Hydrogen Mission, for example, of over ₹19,000 crore shows the government’s commitment that green hydrogen will be made available to small and medium enterprises and all other sectors to make energy transition feasible.
How do you think the capital outlay of ₹35,000 crore for net-zero goal can be effectively utilised?
In climate crisis negotiations we keep asking where is the money for transition. The outlay of ₹35,000 crore for energy transition makes capex available now. It will be useful for difficult-to-abate sectors like steel and cement, as hydrogen can be a game changer for them. But, if you consider e-vehicles and mobility, we have to build the infrastructure now. Over a period of time, the government will also have to consider how can it nudge people to shift. Schemes incentivising purchase of electric vehicles by cutting down interest rates can be thought of. Money will have to be invested in research on removing bottlenecks that are stopping largescale adoption of these technologies. For EVs, for instance, it is how far one can travel in an e-vehicle go. Can I drive down to say Jaipur and come back? Battery technology research is one aspect. The outlay has to be really used for removing these last-mile hurdles for creation of public goods. This ₹35,000 crore is not enough, but we need to build on it.
The FM announced a green credit system which will be notified under the Environment (Protection) Act for responsive action by companies and people. What do you think it is about?
We always thought agriculture is a green activity because plants take in carbon dioxide, water and give us glucose molecule on which the entire universe survives on. Agriculture surely was a clean activity, but we have moved to intensive farming with three crops a year using pesticides. It’s not clean anymore. You are extracting groundwater by using electricity, as a result the water table is going down. Urea is used often indiscriminately and it causes both air and water pollution. Why should farmers stop this practice; are we giving them credit to shift to sustainable agriculture? They need to be rewarded.
This also applies for infrastructure projects that are energy efficient and provide swift mobility at the same time. Till some years ago, using wood was considered unsustainable. Now, we want to use wood because it can prompt regeneration practices so that there is more CO2 fixation and hence agroforestry is being considered in a big way. The government will provide credits for shifting to better practices. That’s what it implies. The details of the scheme will be worked out. A lot of practices can be eligible for credits. TERI will work with the Union environment ministry on identifying some of these practices.
Why do you think India has positioned energy transition as an opportunity?
India has the opportunity because we have to grow. Green may be expensive, but it pays back. Solar payback period is coming down. India has a unique opportunity. Energy generation cost from solar in India is 50% less than in Germany because they are not blessed with as much sunshine. In years to come we can become one the main generators of solar. It’s a young nation and our own energy needs are going to go up. Unfortunately, or fortunately, we have not found any huge reserve of non-renewable source of energy like Guyana, which has found massive reserves of petroleum. So, we have an opportunity of making solar big.
You are heading Think20 Task force on clean energy at G20. Do you think the issue of non-delivery of climate finance by developed countries will be raised?
At G20, I am sure climate finance is going to emerge as one of limiting factors. Since G20 is a collective voice of major economies, raising this issue will gain attention. You have to tell the industrialised countries that they have created the climate mess and that they are not even willing to pay up for it… Delivery of climate finance should go out as a very important message from G20. It’s not a hidden agenda, climate finance is bound to be discussed. India as a country is not afraid. We (India) are now so big that the world cannot ignore us. Therefore, G20 message is to be taken seriously the world.
The World Sustainable Development Summit will be hosted by TERI this month. What are your expectations?
It is a track-2 event. Apart from COP, perhaps this is the major global climate event to be held in the global south. Our theme this year is sustainable development and climate resilience and that is what the budget focused on. We have very good participation internationally, including heads of states and the UN, and we have the opportunity to discuss sensitive issues. It’s not a negotiating table, so there is an opportunity to talk and build solidarity.
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