Sunita Narain: The question of our age

The manner in which we change matters

That we need to change is beyond doubt. What matters is the manner in which we plan to afford the change.

Can we afford not to change? Can we afford the change? Given the crisis that confronts us — inequality and poverty in our immediate midst and growing climate insecurity in our world — we have no choice but to change. But how will this change be afforded? If we cannot find an answer to this one, what we will get is a lot of talk and little action. In fact, we will regress, literally and deliberately.

Take the public transport challenge. Today, everybody agrees we need a massive transition towards buses in our cities. Because of pollution, congestion and because, in our cities, cars have not replaced buses, only marginalised them. As much as 40-60 per cent of people in rich-poor, old-new cities use some form of public transport. Yet, increasingly, we build and decide for private transport. This has to change. Nobody disagrees. But we are not changing, because we do not grasp the ‘affordability’ challenge.

 

In Delhi, for instance, there is tremendous political and bureaucratic buy-in for public transport. So, the city agrees, first, to revitalise its public bus agency — give it new buses and reform its profitability and management. Secondly, it decides to procure modern and convenient buses, including air-conditioned ones, to build a new image for this transport of the many. Thirdly, it decides to overhaul the private bus transport system — the killer Blueline service, so called for the accidents the buses cause. It now plans to divide the city into clusters, which single operators can bid for. These buses, running along the existing service, will be low-floor vehicles, with Global Positioning System (GPS) controls to manage reliability and service benchmarks. All in all, reform.

But it is not so simple. Private buses operate on meagre margins — a household business, running basic buses, with basic services. To upgrade this means paying a price. The cost of the service will be a minimum of Rs 50 per km (buses run roughly 200 km a day or 6,000 km a month). The catch is revenues are less than half — Rs 20 per km. The so-called corporate sector is not interested in a fabled public-private partnership in such a venture.

The answer is complicated when people cannot pay. In Delhi, where per capita income is the highest, a large number of people walk or cycle to work because they cannot even afford a bus. Then there are competing modes — it costs roughly Re 1 per km to travel in a two-wheeler. So, if the cost of travel in a bus is increased, it will push people out — of the bus or into a private vehicle. Neither is an option.

So, how does a city work on this affordability challenge? Tough. The one real option is to cut down on the capital costs of the transition by not buying modern low-floor buses. This will reduce the gap that needs financing but will not bring the image and comfort makeover buses need. But even if this tough choice is made, it will not be enough. The city has other choices to increase revenues — by substantially increasing taxes on private vehicles, putting public transport cess on petrol and diesel and other measures. The bottomline is somebody will have to pay. And it will hurt.

We forget this also when we talk about solar energy. The world glibly talks about the great solar transformation, but does not consider who will pay for it and how. The bus story again.

We know today the price of solar energy is its biggest barrier. It is also clear that scale can push down costs, increase efficiency and mature the technology. But who will go first?

Currently, the model is simple: Countries agree on a limited amount of energy they will pay higher prices for. France pays 42 cents per kilowatt hour (c/kwhr) or roughly Rs 20/kwhr; Greece 50-75 c/kwhr (Rs 25-35/kwhr). Utilities absorb the costs; they can, in their rich and energy-connected world, spread it across the consumers, ending up with little change to lose. They are cautious not to spend much. They want a win-win solution.

But how will we afford the solar bill? Our utilities can pay roughly Rs 3.50/kwhr, while solar would be Rs 17-19/kwhr. Already the cost of energy in India is high, hiking the cost of economic growth. In the current situation, we cannot afford the investment. We cannot afford the change.

But this change can be afforded if the world gets serious about climate change. It will have to put a carbon tax on the already rich — a high tax, which may hurt, for it will increase the cost of energy. But this real money can be used to make a real transition. Over time, as the costs of solar drop, because of deployment in the developing world, everyone will benefit.

We will get change we believe in. And it will not cost us the Earth.