Just Transition To Net Zero

Context: If India intends to announce an ambition for net-zero, then as a country that uses coal for more than 70% of its energy must ensure support for people and communities who are dependent on the coal sector.

Need for ‘Just Transition’ towards net-zero: While there are multiple pathways to achieve net-zero emissions, almost all of them require moving away from coal. Increasingly, the plan also carries elements of a “just transition”:

• It emerged from the labour movements of the 1970s; the term advocated support to workers who were forced to transition due to environmental and social concerns.
• Present-day phase-out plans incorporates elements of energy justice, climate justice, and environmental justice. 
• Thus, most coal phase-out plans include a roadmap for workers and communities dependent on fossil fuels. For E.g.
  • The German coal phase-out plan seeks to end coal burning by 2038 and calls for an investment of more than 50 billion euros for mining and plant operators, impacted regions, and employees.
  • In the US, a new Interagency Working Group on Coal and Power Plant Communities and Economic Revitalisation is created, which is supposed to deliver resources that would revitalize the coal, oil, and gas communities.
  • Canada had placed a Just Transition taskforce in 2018 when it decided to phase out coal by 2030.

The Challenges Faced by India: in transitioning from a coal economy to net-zero.

• High dependence on coal for energy: In FY20, India consumed approximately 942 million tonnes (MT) of coal, of which 730 MT was produced domestically.
• Impact on formal direct and indirect employment in the coal value chain: One study has pegged direct coal jobs at 7,44,984, while another pegs it at approximately 12,00,000 excluding contract employees.
  • According to Kuntala Lahiri-Dutt’s concept, there are two more coal economies along with the formal coal value chain, i.e., statecraft coal (non-legal small-scale coal mines in the northeast) and subsistence coal (small-scale collieries run on village commons usually bordering formal mines) for which there are no official employment figures.
• Difficult to make decisions on financing the transition: as there is a lack of adequate information on data factors like education, skill levels, willingness to migrate, and caste of coal workers.
  • Loss to exchequer: In FY20, the Centre alone collected approximately Rs 29,200 crore in GST compensation cess from coal. These revenue receipts are used for development under different budget heads at the state level.

Way forward: Address the consequences of transitioning - If India wants to adopt a net-zero target, then it calls for the proper planning in place to counter the social and economic consequences caused by phasing out of coal.