G20 Summit: India’s chance to make a difference on climate change, energy

As leaders gather for G20 Summit in New Delhi, experts on Thursday said securing consensus on multilateral development bank (MDB) reforms and adopting rigorous language regarding the phasing down of unabated fossil fuels could enhance India's leadership role.

G20 countries - responsible for 85 per cent of the world's GDP and 80 per cent of the emissions - failed to reach consensus at the energy and climate ministers' meetings in July on the phasing down of unabated use of fossil fuels, tripling renewable energy capacity to 11 terawatts by 2030 and providing low-cost financing to developing countries - issues critical to limiting global average temperature rise to 1.5 degrees Celsius.

Despite the complexity of discussions and uncertainties surrounding energy transition and MDB reforms, there is optimism that the summit's leaders can find a minimum consensus to demonstrate unity. India hopes to get the governments to agree on a fossil phase down. However, if this doesn't find place in the final text, there's a risk of backsliding on the coal phase-down agreed upon at the Bali summit in the previous year.

At the G20 energy ministerial, Saudi Arabia led opposition to fossil fuel phase-down efforts, while the G7 nations had earlier committed to accelerating the phase-out of fossil fuels. Sultan Al Jaber, the President of the next UN climate talks, has stressed that the phase-down of fossil fuels is ‘inevitable' but contingent upon a substantial increase in renewable energy capacity worldwide. Experts, however, anticipate limited progress on fossil fuel discussions at the G20.

RR Rashmi, Distinguished Fellow and Programme Director at The Energy and Resources Institute, said, "On the issue of fossil fuels, it is unlikely that there will be any language additional to what was agreed in Bali due to lack of global advancement and concrete action, despite India's push, on technology, hydrogen, blue economy, and circular economy."

T Jayaraman, Senior Fellow (Climate Change) at the MS Swaminathan Research Foundation, said that considering the vast diversity within the bloc, spanning from the lowest emitter, India, to the highest emitter, the US, any global targets set at the G20 must account for this differentiation and acknowledge varied national circumstances. At 2.4 tCO2e (tonne carbon dioxide equivalent), India's per capita greenhouse gas emission is far below the global average of 6.3 tCO2e, according to a report released last year by the United Nations Environment Programme. Per capita emission in the US (14 tCO2e) is far above the global average, followed by Russia (13 tCO2e), China (9.7 tCO2e), Brazil and Indonesia (about 7.5 tCO2e each), and the European Union (7.2 tCO2e).

Jayaraman stressed that these global targets will only gain meaning and drive momentum for the UNFCCC process if they embrace principles of equity and climate justice, which have consistently been part of India's stance in climate discussions. He urged developed nations to triple their renewable energy targets by phasing out fossil fuels, particularly oil, gas, and coal.

"While the renewable energy target must reflect a higher ambition from developed countries, China, India and Brazil are among the top-most deployers of non-fossil fuel sources. When the US installs only as much RE as India, clearly it is time for the US to show greater ambition," he said.

Jayaraman noted that developing countries, including India, are committed to their low-carbon development paths, with India already setting ambitious renewable energy targets and championing initiatives like the International Solar Alliance. He argued that a substantial portion of the 6,000 GW of new renewable energy should come from developed nations through the substitution of fossil fuels.

Indrajit Bose, Global Policy Lead at Climate Action Network (CAN) International, a global network of government and non-government environmental organisations, advocated for an equitable phase-out of all fossil fuels, with developed countries taking more responsibility.

Tejal Kanitkar, an associate professor at the National Institute of Advanced Studies in Bengaluru, emphasised that global targets, when applied uniformly without differentiation, disproportionately burden developing countries, especially those experiencing rapid increases in energy demand. She said developing countries should not readily accept any global target unless it is accompanied by a clear commitment to achieving these targets through principles of equity and Common but Differentiated Responsibilities and Respective Capabilities (CBDR-RC).

Vaibhav Chaturvedi, a fellow at independent think tank Council on Energy, Environment and Water (CEEW), said: "The debate (on finance) is going in some direction... At the G20 level, it is the first time that countries are talking about MDB reforms in such a detailed and intensive way about operationalisation of climate finance. It means a lot if the countries which have a say in the MDB processes agree to reforms."

However, he stressed that it would be worrisome if meaningful progress on finance isn't achieved at the G20, as strong signals are essential for the market to move in the right direction to meet climate targets. Bose said that a failure to secure an agreement on equitably phasing fossil fuels along with meaningful financing for developing countries for a just transition at the G20 Summit could complicate efforts at COP28. "At the same time, the UN climate talks have 199 countries together. There will be pressure from civil society also. So, it's a different platform. There might still be a fair chance to push it at COP," he added.

Developing countries including Indonesia and South Africa have objected to the tripling of RE capacity without clarity on finance to achieve this. Bose acknowledged that "developing countries might face challenges in reaching these targets due to the sorry state of climate finance".

Experts say the majority of the funding allocated to developing countries to address the effects of climate change and achieve their climate objectives is provided in the form of loans or investments, rather than grants, which means countries have to pay it back. This is a problem because the countries that need the money the most can't afford to pay it back. During the 2011-20 period, merely about 5 per cent was disbursed as grants, while the remainder constituted loans or equity. Notably, 75 per cent of all climate finance throughout the decade centered in North America, Western Europe, East Asia, and the Pacific.

According to data from the Climate Policy Initiative (CPI), an independent climate policy organization headquartered in San Francisco, regions housing the majority of low and middle-income countries received less than 25 per cent of climate finance flows.

Chandrabhushan, the president and CEO of the International Forum for Environment, Sustainability & Technology (iFOREST), said: "More finance for developing countries, tripling of renewable energy targets and phasing out of fossil fuels are all interconnected issues and an ambitious announcement on these would be a plus for India's G20 presidency." He, however, said the convention's success is denoted only by how much emissions countries are reducing and whether IPCC goals will be met or not.

Champa Patel, Executive Director of Government and Policies at Climate Group, an international non-profit organisation, said: "Countries across the G20 risk missing out on the gold rush of the 21st century as they slowly walk towards greater renewable electricity. Hundreds of major companies we work with are already moving towards using 100 percent renewable electricity, with many also requiring it from their suppliers. If corporate giants are demanding it, jumping on the transition is about business-survival, and governments need to facilitate that." "Businesses need government action and long-term policy clarity to confidently go all-in on climate action. Governments that fail to provide that are forcing their economies to rely on fossil fuel-based systems that will become increasingly obsolete," she said.