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| Indian firms may get to trade in energy efficiency credits |
| Bloomberg / New Delhi Dec 17, 2008, 00:18 IST |
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India is considering allowing trading of energy efficiency certificates and giving concessions such as capital subsidies to promote solar energy, seeking to mitigate damage from the changing climate.
“We are relying on incentives and market mechanisms to trigger larger investments,” Shyam Saran, special envoy of the prime minister on climate change, said in New Delhi today after unveiling the India Carbon Disclosure Project 2008 report.
India, the world’s fourth-largest emitter of carbon dioxide, in June said it will form eight commissions to encourage solar power, energy efficiency and water conservation as part of plans to address global warming and cut fossil-fuel dependency. Asia’s third-biggest economy expects to announce as early as next year proposals for discussions on the eight commissions, Saran said.
China, India and other developing nations failed to garner support from industrialised nations on increasing funding by about $20 billion to help poor nations cope with the damage caused by climate change. One hundred eighty-nine countries after 12 days of talks in Poznan, Poland, that concluded last week agreed to start formal negotiations for a new treaty.
There is concern that an agreement on steps to mitigate climate change may get relegated because the worst financial crisis since the Great Depression has pushed economies from Japan to Europe into recession.
“There is going to be a tendency to put on the backburner issues which require longer-term thinking,” said Arun Bharat Ram, chairman of SRF Ltd, a tire cord and packaging film maker.
About 33 per cent of the 61 companies that responded to the Carbon Disclosure Project provided information on greenhouse gas emissions, according to the report. The project had sought to cover 200 of the country’s top companies, the report said.
About 29 per cent of the respondents provided information on the quantity of power purchased and 72 per cent of the companies that responded did not forecast or estimate their future emissions, the report said.
India is seeking to spur adoption of efficient technologies and systems as it can reduce consumption of energy by at least 25 per cent in some high-energy industries, Saran said. It is considering using existing laws such as the Energy Conservation Act and the building code to apply various benchmarks, Saran said.
“We can have something like an energy efficiency certificate where those installations that are above the benchmarks get credits and those below buy those allowances,” said Saran. “This would be a market-based mechanism and many aspects have to be carefully studied before we can go for an exchange-based system.”
The government is also working on steps it needs to take to regulate, promote and give incentives for encouraging the use of solar energy, Saran said, without providing any details.
The world’s second-most populous nation on average gets about 300 days of sun, according to Jaswinder S Ahuja, chairman of the India Semiconductor Association and vice-president of Cadence Design Systems Inc.
“India has an advantage partly because the intensity of the solar energy available is much greater than in other countries,” Saran said. “And the second advantage is the scaling up we can offer because of the huge scale on which our economy operates.”
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