Climate change has been affecting the world at large. Environmentalists, climate experts, corporate sector, academic institutions and policymakers are looking at sustainable models to help not just raise awareness about how changes in the climate can impact the health of future generations, but make changes that can have a long-lasting impact.
To understand the issue better and find ways to work effectively towards this goal, The Energy and Resources Institute (TERI) organised the 22nd World Sustainable Development Summit 2023 in New Delhi from February 22 to 24, wherein experts stressed that the issue of climate change needs to be put on the priority list of government and private bodies who need to pump in resources to be able to produce results.
Amitabh Kant, Sherpa, G20, Ministry of External Affairs (MEA), who was present on the occasion focussed on meeting the decarbonisation targets for 2030. He said that India might be the first country to industrialise without carbonising the world, and, therefore, it took several measures in the Paris Climate Conference (COP 21) for the Nationally Determined Contribution (NDC) targets. He said these targets can be achieved much before the 2030 timeline if all stakeholders work together in this direction.
Mentioning that India is climatically blessed, and has the potential to be the least-cost producer of green hydrogen, he also said that the price of green hydrogen, right now, is about close to $5 per kilogram, which needs to be brought down to $2.5 per kilogram in the next two-three years and to $1 per kilogram by 2030.
“To produce green hydrogen on a large scale, you need long-term institutional financing, credit enhancement, first-class guarantees, an agency like Multilateral Investment Guarantee Agency (MIGA) to be able to do that,” he said.
“However, the institutions that were designed for the post-World War II period, were not designed to be financing agencies for climate change. Therefore, unless you do not structure them to finance the whole SDGs and climate finance, it will not be possible to get long-term financing. Therefore, these international institutions that do direct lending, should become instruments and agencies for indirect financing,” he explained.
Jagjeet Singh Sareen, Principal of Dalberg Advisors, a consultant firm, also recommended expanding the scope of climate finance and making climate smart transition.
“Given the heft of G20 countries—about 85 or 90 per cent of the global GDP—our leaders should quickly shift from narrow band of climate finance to climate smart transition of financial sector, and that’s where Environment, Social and corporate Governance (ESG), disclosures, new capital climate tech become important,” he emphasised.
Climate change is still not being considered a crisis, making it tough for countries and corporates to work actively towards fighting its causes and ill effects, opined Mahendra Singhi, CEO of Dalmia Cement. He also highlighted that perhaps, there is a dearth of specific strategies needed to deal with climate change.
“If we look at the budget for any year, less money has been allocated for financing such activities. The reason may be that we are still not considering climate change a crisis. It’s not that countries or corporates do not have the finances, said Singhi. “We are well aware that countries are spending huge money for financing wars, and, at the same time, also investing money to take care of people in terms of hurricanes, cyclones or Covid. But, the reason that specific finance is not being allocated for particular Sustainable Development Goals (SDGs), climate actions, may be that there is no specific strategy for using the finances to achieve a certain goal.”
One of the experts, Dr Dhruba, Purkayastha, Director of Climate Policy Initiative in India, highlighted that there is a huge gap in climate investments, globally.
“There is a huge gap in climate investments, globally. As a climate policy initiative, we tracked that for the last seven years, and found that the order of magnitude required is somewhere around $2.5 to $3 trillion. However, what we reach barely is less than $1 trillion, and it is the same story that every other institution puts up,” he informed.
Like others, Dr Purkayastha also advocated that there is a need for an institutional mechanism to ensure that the money that is generated for this purpose is spent judiciously. The stakeholders who gathered at the summit stressed on a collective approach going forward to address the concerns around climate change for a better future.
