INDUSTRIES AND PARIS AGREEMENT

- Rajesh Deoliya

05062021                                 
 
Recently, due to the pressure of the stake holders the two directors of EXXON Mobil were replaced on the ground that the company is not addressing the Climate Change Concerns. After the Paris Agreement,2015, there is pressure on the governments and industries to reduce their carbon emissions so that the earth’s rising temperature trends can be reversed and temperature can be reduced to 2 degree by year 2050 and green house gas emission can be reduced.

India, China, US and Russia are the leading contributors to the world’s carbon emission. The China’s contribution is approximately 26 %, United States 13 %, India 7 % and Russia is 4 %. This means that out of the 197 countries who pledged to reduce the emissions, the share of these four countries towards the greenhouse gas emission is about 50 percent. In the Paris Agreement pledge, India has committed to reduce its emission of greenhouse gases intensity of its GDP by 33-35 percent below 2005 levels by year 2030. The emission levels in 2005 from India were was 0.47 metric tons of carbon dioxide per $1,000 of GDP; a reduction of 35 percent means the emissions should go down to about 0.31 metric tons in 2030.     

The carbon dioxide, methane and nitrous oxide are the main green house gases. Since industries are major contributors to the rising emission levels, because of the large scale use of fossil fuel as raw material in the production process, power generation, transport of raw material and end product; there will always be a pressure on industries to cut their emission levels. Though the good news is that due to the increasing use and investment in the alternate energy like solar power, wind power, hydro power, use of battery-operated vehicles, LED lights, technological up-gradation in the production process etc. the India at present has reduced it emission levels to about 21 percent against the proposed 30-35 percent by year 2030. This is a good sign that we are on the right path, to achieve the targeted goals.

In the Paris Agreement, the Intended Nationally Determined Contribution (NDC), expressed by India for target year 2030 are :

a)    1. Reduce the emissions intensity of GDP by 33-35 percent from the 2005 levels.

b) 2. Increase the percentage of non-fossil-fuel electricity to about 40 percent of total electric power capacity.

c)  3.   Create an additional carbon sink of 2.5-3.0 billion tons of CO2-equivalent through additional forest and tree cover.  

The above-mentioned commitments can be achieved by multi-sectoral approach. This will involve stakeholders like government, industry and community.  Since industry is the main and evident contributor, the responsibility on industry to come forward and take pragmatic steps to reduce its emission levels and adopt its environmental management policies in accordance with the world’s concern, is need of hour. The community do not want a polluting industry in its surrounding. So, for an industry which is not changing its operations in accordance with the national commitments and with the local concerns then the survival of such industry is always at stake. Even it can lead to the closure of industry which means loss of business, financial burden, legal action, unemployment, impact on local economy, anti-industry sentiments in the eyes of community, discouragement of funding from the financial institution and many more. The City Bank and other financial institution are preferring funding to the renewable energy over the fossil fuel. Similarly, green fund concept is increasing in which environment friendly projects are preferred for funding. Therefore, the business models in future have to give much impetus on the environmental part of the business process for smooth and socially acclaimed business entity. The case of Exxon Mobile which is referred above is not only one there are several instances where penalties have been imposed on industry for not reducing the greenhouse gas emissions. In case of Royal Dutch PLC the  Dutch court ordered Royal Dutch PLC to cut 45 percent of its the 2019 green house gas emissions by year 2030. The Carmichael thermal coal mine of Adani Group is facing problems due to several environment related issues one of which is its addition of  around 4.7bn tonnes of carbon pollution to the atmosphere over its 60-year lifespan (source: https://www.mining-technology.com/features/adani-carmichael-controversy-explained/). The Adani group is technically and scientifically defending these figures but the rise of such issues itself suggest about the changing patterns of business processes and threats from the climate change issues.

Industry preparation to combat Climate Change :

Recently, Heidelberg cement has announced that its Sweden Cement Plant will build “World’s first carbon-neutral cement plant”. The location is Swedish island of Gotland. Here, about 1.8 million tonnes of carbon dioxide will be captured annually from year 2030 onward which is the plants total emissions. In India, companies are taking  several initiatives to cut the emission through the installation of Waste Heat Recovery Systems, use of alternate fuel resources, use of  renewable energy etc. The companies are undertaking climate change risks assessment in their areas of activities and adopting mitigation measures, even the use of low emission vehicles for in-plant movement and logistics is talk of day and may be soon implemented upon easy availability of such vehicles. The recent announcement by the government to blend ethanol ( upto 20 percent ) with petrol is also a measure towards the reduction of the use of crude oil and green house emission.

A sincere effort for the afforestation, minimum cutting/ felling of trees, plantation of the native plants, which are suitable for bird silting and rejuvenation of bio- diversity in the project affected area has to be taken up seriously and even before the commencement of the project activity, if possible, so that when the project commences its operation, the project area has sufficient forest cover. The forest helps in increase of the oxygen and reducing the carbon in the atmosphere hence the afforestation and reforestation play a considerable role in combating climate change. A thick and fully grown tree can reduce about one tonne of carbon dioxide from the atmosphere. Hence, the efforts to reduce the tree felling and afforestation in the project area will give edge to an industry over other counterpart.    

The Approach:

In the challenging situations there is need to revisit the environment cells of the organizations. The cell has to be well motivated with the clear goal, a transparent and fast decision making system to utilize the funds allotted for the environment conservation for reduction of emissions. The Environmental Impact Assessment Report and Environmental Management Plans should have more scientific and statistical data, discuss the inter-relation of various parameters. The reports should  discuss the project in compliance to the targets of the Paris Agreement so that baseline carbon foot prints and impact of the project activities on the local carbon foot prints can be known and adequate measure can be planned. There should be collection of the data in such a way so that it is helpful in proper environmental audit and can always be defended. This is required to avoid the conflicts of interest with the other stake holders, in the absence of this it will be difficult for any organization to defend and may face the damage which is not in the interest of the growth of economy. The time has come when industry should also relate itself to the Paris Agreement targets.

 

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Comments

Dr. Pandey said…
Very informative and meaningful post. Indeed role of industries is very disappointing. Similarly Biomass burning practices and shameful role of operating / monitoring agencies should also be measured and highlighted for the larger interest of society.
Niraj Chowdhary said…
Very informative & well narrated Sir. All complex issues explained in very simple understandable language.

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