Recent pronouncements by the NDA ministers, when read together, provide insights into the NDA government’s ‘Acche din ayenge’ (good days ahead) promise. Finance minister Arun Jaitley provided Rs 7,060 crores in the 2014-15 budget for developing 100 smart satellite townships to existing cities. Environment minister Prakash Javadekar said that to reduce poverty, India’s carbon emissions must grow till 2030-40.
Can India find the large quantity of energy needed to develop smart cities? Will greater fossil fuel use, the primary cause for carbon emissions, in projects like smart cities, bullet trains, river linking, reduce poverty? I.e., can India replicate the 20th Century North nations development model that used massive quantities of energy to reduce poverty?
Indian cities are semi-fossilfuelled. The older parts of these cities, built before fossil fuel technologies existed, have narrow streets meant for non-fossilfuelled transport, and 2-4 storey buildings built with low-strength binders. The newer parts have broad streets for fossilfuelled vehicles and cement concrete highrises. A conservative energy cost estimate for developing an area of 5,000 km2 of fully fossilfuelled smart city area (@50km2/city x 100 cities) is 600 million tons of oil equivalent (Mtoe). That is equal to India’s current annual total primary energy supply (TPES), costing Rs 35 lakh crores, or double the 2014-15 budget.
In the first decade of this century, India’s fossil fuel consumption grew at 6.2% pa. If the additional energy required for smart city project is spread over the next 10 years, fossil fuel consumption growth will have to jump to 10.2% pa.
Unlike additional money, extra energy cannot be printed. It has to be found, and then accessed. India is already hard pressed to meet current fossil fuel demand. Coal contributes 60% of the fossil fuels India consumes. India has the fifth largest coal reserves in the world. Yet, it imported 21% of its coal consumption last year as indigenous production failed to meet demand for various reasons. Opening new coal blocks, per former Environment minister Jairam Ramesh’s recent statement, will endanger India’s environment as these blocks are in India’s dense forests that constitute only 2.5% of India’s area.
Indigenous oil and gas reserves and production are low. Consequently, India imported 71% of its oil and 29% of its gas last year. Increasing imports will burden the economy further, particularly if instability in the Middle East ups oil prices.
Cheap and abundant energy days are over. We have hit peak oil, i.e., oil production peaking followed by decline, for lack of sufficient new oil discoveries. Consequently, oil supply has remained flat at 85 mbd for the last decade despite rising demand. Peak gas will happen 2-3 decades later. Replacing oil and gas with coal will increase carbon emissions and global warming more rapidly. Green and nuclear energies cannot replace fossil fuels.
Despite India’s effort to open new mines in India and acquire wells abroad, the massive quantity of energy required for making smart cities is likely to remain elusive.
Comparing India’s carbon emissions, development and poverty statistics with other Asian countriesthat share the same tropical ecological space throws light on whether burning more fossil fuels, the carbon emissions source, reduces poverty.
India’s per capita carbon emissions are 1.7 T per annum (pa). Corresponding figures for Bangladesh, Cambodia and Laos are 0.3-0.4 T and Bhutan 0.7 T, respectively. Yet UNDP’s Human Development Report 2014 (HDR14) released in the last week of July indicates that the human development in India and these countries is almost the same. The Human Development Index (HDI) score of all these countries ranged 0.558-0.586 and are ranked 135-142. The multi-dimensional poverty index (MPI) scores provided in HDR14 indicate that half the population in India, Cambodia, and Bangladesh, and a third in Bhutan and Laos are under the poverty line.
Srilanka has done way better than India. Its HDI score of 0.750 puts it 52 ranks above India, and is not mentioned in the HDR14 MPI list. The HDR13 report puts 5% of Srilanka’s population under the MPI line. Yet its per capita carbon emissions are 0.6 T pa, 65% less than India’s.
Bangladesh, Bhutan, Cambodia, Laos and Srilanka matched or emulated India’s HDI and MPI scores but with significantly lower per capita emissions. Their performance questions Javadekar’s statement.
How did they do it? First, they used proportionally less fossil fuels in their TPES, ranging 25-50% compared to India’s 73%, hence lowered their per capita carbon emissions. Second, their lower urbanization (<20%) compared to India’s 31% reduces their energy consumption and carbon emissions. Bangladesh is an outlier to this trend. Cities are energy guzzlers consuming 75% of global TPES but producing only 5% of it. Per unit area, cities consume a hundred times more energy than hinterlands.
Third, India’s greater reliance on fossil fuels makes its economy less energy efficient and more polluting, consequently leaving less energy for human development and poverty reduction. Economies operate like heat engines coupled in series. The First Law of Thermodynamics states that heat losses reduce engine efficiency to less than 100%. A greater number of engines in series lowers the cradle-to-grave efficiency of the economy and increases emissions. E.g., to run an electric car requires a large number of energy conversions. Its well-to-wheel efficiency is half that of a diesel vehicle and it’s per passenger-kilometre carbon emissions greater. The emissions are transferred from the car site to the power plant site.
Only the state and big business can make the large investments that fossil fuels technologies require. To recover investments it makes sense for investors to make profit rather than use fossil fuels for human development. Biomass technologies are cheaper and more accessible to common people, and can be more readily used for human development.
The larger biomass proportion in the energy mix of Bhutan, Cambodia, Laos and Srilanka make their economies more energy efficient and less polluting than India’s, and also allow the poor better energy access. They therefore have HDIs on par with India but at lower per capita emissions. Social security programmes of these countries have also contributed to this phenomenon.
In the last two decades India’s economy and consequently carbon emissions have grown rapidly. The gap between the rich and the poor instead of decreasing with rising emissions, has actually increased. India’s GDP quadrupled, but the top 10% of earners make twelve times as much as the bottom 10%, up from six a decade back. India’s Gini index indicates that inequality has widened in the last decade. In a recent lecture, IMF managing director Christine Lagarde stated that, “In India, the net worth of the billionaire community increased 12-fold in 15 years, enough to eliminate absolute poverty in this country twice over.” For two decades India has sung the 10% growth mantra paying little heed to distributive justice.
There is growing consensus that “trickle down” benefits of growth have been weak in India. If the trends of the last two decades continue, it will take India several score decades to lift its entire people above the poverty line. Provided global warming and peak oil don’t tip the world into a crisis. If either happens, poor and vulnerable populations will be impacted the most.
India and other South nations cannot replicate the development path that North nations took in the last century—pull most of their populations above the poverty line, achieve a high HDI, and put 75% of their populations into fully fossilfuelled cities. They did this by using 80% of all fossil fuels consumed in the last 250 years. The massive amount of cheap and abundant energy that was siphoned by North nations from their colonies and their hinterlands is no longer available to South nations today.
Urban Development minister M Venkaiah Naidu should share his energy cost and supply analysis for the proposed 100 smart cities, and convince public that this project will not widen the divide between the privileged and the poor and that it is as important as providing basic urban civic and public transport services, housing for the poor, etc. The Ministers for Railways and Water Resources should do likewise for their bullet train and river linking projects. And Javadekar must substantiate why he feels more emissions will reduce poverty. Else, the “ache din ayenge” chant will start looking like a mirror image of UPA government’s “aam admi ke liye” (for the common man) mantra, which became a smoke screen to do “gain maximization for a few”.
The author works with Cerana Foundation on social energetics and environmental risks