The unexpected election of President Donald Trump has prompted diplomats and governments around the world to question what to expect from the next four years.
When it comes to climate change, many environmental campaigners are alarmed. This is understandable: Trump has sent mixed signals, and we have much to learn about the new administration’s plans. But there is cause for hope, and even a potential opportunity for India.
Climate change is real and mostly man-made. While in the past Trump has questioned the science, since the election he has acknowledged that “there is some connectivity” between human activity and climate change.
Trump said on the campaign trail that he would drop the Paris climate change treaty. While he has said subsequently, “I have an open mind to it,” it appears very unlikely that the US will fulfil the carbon cutting promises that were made under President Barack Obama.
This is far from the world-ending event that some environmentalists suggest. In fact, it offers an opportunity for other nations including India to step in and help lead the way with a smarter approach.
Even if it were to survive, the Paris treaty by itself would do very little to rein in global warming. The United Nations estimates that if every country were to make every single promised carbon cut between 2016 and 2030 to the fullest extent and there was no cheating, CO₂ emissions would still only be cut by one-hundredth of what is needed to keep temperature rises below 2°C.
The problem is that these feeble promises will be costly. Today’s green technology is still very inefficient, requiring significant subsidies. Trying to cut carbon dioxide, even with an efficient tax, makes cheap energy more expensive – and this slows economic growth.
Calculations using the best peer-reviewed economic models show the cost of the Paris promises – through slower GDP growth from higher energy costs – would reach $1-2 trillion every year from 2030.
India knows that cheap and plentiful power is crucial. Like China, which over the past 30 years has lifted 680 million people out of poverty – more than any nation has ever managed in the history of the world – India’s growth has been mostly powered by cheap, if polluting, coal.
Prime Minister Narendra Modi has suggested that he wants 100GW of solar PV power and 60GW of wind power by 2022. This is highly ambitious: the International Energy Agency (IEA) does not expect it to be achieved. Indeed, solar energy in 2020 is expected to produce just 3% of electricity in India, and provide just 0.4% of India’s energy.
Right now, India gets 0.4% of its energy from wind and just 0.03% from solar PV, and even in 2040, in an extremely optimistic scenario, India will get just 3% of its energy from wind and solar.
This emphasises that for coming decades, India’s growth and development will be focussed on cheap, reliable power, often from coal. India has proposed to double its coal production by 2020.
But this focus makes sense. More than 300 million people lack reliable access to electricity. Since we know that power is one of the most crucial inputs to get out of poverty, it is vital for India to focus on getting more power at low costs.
But the demise of the Paris treaty offers a compelling opportunity to tackle global warming smarter.
Climate economists have found that a much more effective way to tackle global warming comes from investment in green R&D. If we can make green energy cheaper than fossil fuels we will encourage everyone across the world to switch.
This would also help India, which the IEA expects will still pay more for solar and wind electricity in 2040 than the average generation cost of electricity in the entire system.
That is why the demise of Paris could shift the focus to the much more important promise of doubling R&D.
In fact, a panel of Nobel laureates for Copenhagen Consensus found that we should increase R&D six-fold, to reach at least $100 billion a year.
India well knows the need for cheap power, and is positioned to be part of a technology-led response that would provide a real solution to this challenge.