Climate Change

Aaron Steinberg is an interdepartmental program assistant at the Council on Foreign Relations in New York.  On Sunday, the Indian Election Commission released the much anticipated polling dates for the 2019 general election. Amid the electoral preparations, opposition party members are accusing the incumbent, Prime Minister Narendra Modi, of using recent tensions in Kashmir to stoke nationalist sentiment. Political analysts say that Modi’s response to the tensions have indeed helped in preliminary polling, but the concern over domestic issues that had been haunting the prime minister remain during this politically pivotal juncture.   One of the centerpieces of the Modi government’s platform has been addressing air pollution, but his efforts to ameliorate the matter have reportedly fallen short. According to the latest data on air pollution, seven of the ten most polluted cities globally are in India’s Indo-Gangetic Plain (IGP)—home to over half of the country’s population. One of the most common metrics used for air pollution is the concentration of suspended particulate matter that have a diameter less than 2.5 micrometers (PM2.5). Various factors contribute to poor air quality, but one culprit, residential energy use, has been identified as a primary contributor to emissions in the IGP. Last year, a study using recent data on PM2.5 concentrations found that residential biomass burning causes as much as 90 percent of the annual anthropogenic PM2.5 emissions in the IGP. The residential energy emissions come primarily from the 78 percent of people who burn biomass (usually in the form of agricultural residues, fuel wood, and dung cake) for cooking and heating, as it is the most affordable energy source for low-income households. Carcinogens from biomass burning contribute to an array of health issues, including respiratory and heart diseases, cancer, and stroke, all of which are central to India’s increasing burden of noncommunicable diseases. One New Delhi chest surgeon found that half his lung cancer patients are nonsmokers; when he started practicing thirty years ago, 80–90 percent of such patients were smokers. For many, breathing has become the new smoking. In 2016, the Modi government launched an initiative to address the issue. Known as Pradhan Mantri Ujjwala Yojana (PMUY), it aims to create liquid gas connections for households below the poverty line and subsidizes state-owned fuel retailers for every new connection. The massive transition has made India the second-largest importer of liquefied petroleum gas (LPG) in the world, and it is poised to take the lead in 2019. Currently, India imports nearly 80 percent of its fuel to meet demand, leaving the supply vulnerable to price fluctuation and political whim. Amid India’s rising demand, importers looked to Iran as an additional source, becoming the country’s second-largest client. Major disruptions were expected in the wake of President Donald J. Trump’s renewal of sanctions, but India, along with eight other countries, were granted waivers, which prevented disruption. Had sanctions been carried out against Saudi Arabia, as was threatened in the wake of the murder of journalist Jamal Khashoggi, PMUY would have faced severe disruptions.  India’s reliance on imports, combined with the subsidies given through PMUY, has put considerable strain on the country’s balance of payments. PMUY’s initial success helped justify the expenditure, but issues are beginning to arise as the program progresses. With general elections coming up in the spring, the Modi government appears to be doubling down on its efforts. PMUY has made impressive progress since its introduction; fifty million new LPG connections have been reported as of 2019. The program’s success has been credited with assisting Modi’s party, the Bharatiya Janata Party (BJP), in winning the 2017 legislative assembly election in Uttar Pradesh (UP), where PMUY was originally implemented. It is no coincidence that PMUY was launched in UP, which sends the most legislators to parliament of any state. The Modi government is looking for similar success in the upcoming election, but the longevity of PMUY is being questioned as low refill rates for the LPG cylinders indicate a return to biomass burning. Currently, PMUY beneficiaries pay for their stove and first cylinder refill in monthly installments; however, beneficiaries must pay market rates for subsequent refills. While PMUY has done well in creating LPG connections, many Indian households are finding it difficult to fund the refill of their LPG cylinders despite the incentives. In one UP district, refill rates sunk as low as 25 to 30 percent. When money is scarce, returning to biomass is an easy way to cut costs. As of early 2019, Modi is polling ahead of his closest competitor, Rahul Gandhi, but his lead has diminished in the past year. Failing to address the shortcomings of PMUY would be a major misstep for Modi and the BJP. The government’s current plan to increase LPG subsidies may help restore confidence in PMUY throughout the election period, but energy-source diversification is crucial to long-term success of the program. India’s shift from biomass is one facet of a larger low-carbon transition. LPG is an example of a low-carbon alternative, but converting to an energy source with greater domestic availability would help ensure greater stability for the program. One method suggested by the National Institution for Transforming India is complementing the new gas stoves with electric stoves, which could be powered by domestically sourced energy. Currently, India’s energy mix is dominated by coal, which will remain a fixture for the foreseeable future. Like biomass, coal is a major contributor to air pollution, so investing in cleaner, more efficient coal plants to power electric stoves would curb emissions from both sources. Although coal is dominant, renewable sources are a distant but growing second, outpacing the growth of coal in 2018. Today, renewable energy stands at around 20 percent of the energy mix and is projected to reach at least 48 percent by 2030. If increased access to alternatives to biomass burning are paired with a more diversified energy mix in India, PM2.5 levels would be drastically diminished, leading to greater quality of life for all, especially as renewables supplant coal. PMUY has been a successful first step in addressing biomass burning and improving India’s overall air quality, but as the BJP’s flagship energy program stands now, India’s air quality and its health are largely contingent on the price of and access to LPG.

This is a guest post by Benjamin Silliman, research associate for Energy Security and Climate Change at the Council on Foreign Relations.  Amid controversy whether the Green New Deal manifesto is too broad, Senator Edward Markey (D-MA) spoke out in an interview published yesterday to elaborate on direct Congressional actions that might come about in alignment with the resolution’s chief environmental focus. Distinguishing the resolution’s aims from his past efforts to pass cap-and-trade market pricing carbon emissions credits, Markey noted, “We could wind up putting a price on carbon, but we have to protect the most vulnerable simultaneously.” Markey’s suggestions in the interview may give a hint at what Democrats think is possible to pass right now: “Practically speaking, we could pass a tax-extender bill for tax breaks for wind, solar, batteries, electric vehicles. We could pass an infrastructure bill that would be a green infrastructure bill. We can take the appropriations process, and in each individual area insert funding for green programs. We can make a down payment on what we need to do now on infrastructure, on taxes, on appropriations. And that is the beginning of a pragmatic way of looking at this existential challenge.”  Markey’s words might resonate with many members of Congress, from both parties, who are frustrated with the executive branch’s inability to respond effectively to the pressing issue of climate change. Congress could exercise its authority over the budget to start funding green infrastructure programs within the U.S. Department of Defense, the Federal Emergency Management Agency (FEMA), and federally funded projects through companies like the Tennessee Valley Authority or the Export-Import Bank of the United States. Current U.S. government support for infrastructure is woefully inadequate. The nation’s energy, rail, water, road, communications, and industrial systems are in need of significant investment. The American Society of Civil Engineers estimates that there is an infrastructure spending gap in the United States of nearly $1.5 trillion needed by 2025 just to maintain the quality of current infrastructure. These estimates mean there is a tremendous opportunity to authorize appropriations that could be used more wisely to address transportation, energy, water, and defense infrastructure in a manner that is more resilient to climate change and supports the transition to cleaner forms of energy as upgrades are needed. To do this successfully, data-driven metrics clearly evaluating previous infrastructure’s cost, effectiveness, vulnerabilities, and environmental impact are needed, and should be a high priority for congressional research to establish. Developing a procedural and flexible evaluation structure will allow for optimal technologies to be deployed, maximizing environmental gain for cost. The U.S. Department of Defense (DoD) has openly and repeatedly raised concern about the effects of climate change. According to the U.S. Government Accountability Office, DoD maintains a portfolio of $1.2 trillion of infrastructure across 4,800 sites worldwide as of 2017. During the next round of budget increases, infrastructure spending should be tied to green spending and research. The Trump administration has also made it clear it plans to “rebuild” the military. To do so will require substantial infrastructure investment. Ensuring that infrastructure is resilient to climate risks is vital. Congress should look for low-hanging fruit elsewhere in the budget as well. Disaster relief organizations, like FEMA, that participate in large-scale infrastructure investment for repair after damaging events, would benefit from requirements that consider climate change. In 2017, the National Oceanic and Atmospheric Administration (NOAA) estimated that natural disasters caused $300 billion in damages. To supplement relief resources, Congress appropriated an additional $34.5 billion in post-disaster funds and forgave $16 billion of debt for the National Flood Insurance Program. In the future, when designating supplemental relief funds, a green infrastructure or increased weatherization requirement would help ensure that damaged infrastructure is replaced with buildings and energy systems that are better prepared for extreme weather events. The damages experienced by Californians after utility PG&E failed to upgrade its equipment against heat and fire is a telling lesson in the liability risks that come when infrastructure cannot meet current environmental conditions. Initial funds allowing for better planning and access to capital to make needed weatherization and energy efficiency upgrades could potentially reduce the extent of future relief needed in the future. Congress also can use its budget influence on federally-funded infrastructure projects to require certain environmental standards as a prerequisite. That could include environmental targets on state-owned entities like the Tennessee Valley Authority (TVA), a government-backed company that built power projects during the original New Deal and recently opted to shutdown coal plants. TVA is already managing liabilities from coal ash spills. Activists looking for bold, comprehensive action won’t be satisfied with the U.S. Congress taking these incremental steps.  However, such steps are immediately implementable and would avoid one of the biggest problems confronting our ability to implement climate solutions, mainly that infrastructure is long-lasting. Once it is built, it is harder to allocate funds to replace it. Forcing greener choices in current appropriations would help pave a path towards broader legislation.

This guest post is co-authored by Sarang Shidore, a visiting scholar at the LBJ School at the University of Texas at Austin, and Joshua Busby, associate professor of public affairs at the Robert S. Strauss Center for International Security and Law at the LBJ School at the University of Texas at Austin. For four years, we have been tracking the solar sector in India as it seeks to scale up to meet the government’s 100GW target by 2022. Although rooftop additions continue apace, there has been slower growth at the utility scale. The next stage of growth in India will be difficult to achieve without major reform across the electricity sector as a whole. But an upcoming national election in May could bring in a weaker coalition government, adding to the sector’s already large challenges that include land acquisition and problems with the existing auction system. Utility-Scale Slowdown Implies 2022 Goal is a Stretch India’s annualized solar capacity addition was 8.2 GW in 2018, down from the previous year’s all-time high of 9.6 GW. Though utility-scale additions dropped by nearly 20%, rooftop solar showed a remarkable surge of more than 70% over the previous year from a smaller base. However, India’s rooftop growth is focused mainly in the commercial & industrial sectors – residential solar has yet to take off in the country. As of January 2018, India had more than 26 GW of capacity of solar electricity, dramatically higher than the 2.5GW in 2014 when Prime Minister Modi took office. However, as we wrote last year, 100GW is a stretch goal that India likely won’t reach by 2022, and that continues to be the consensus among industry-watchers. The latest forecasts estimate that India will reach 65GW of installed solar capacity by 2022, of which 51GW will be utility scale and the remainder divided between rooftop, open access, and off-grid solar. While that is below the announced target, it is still impressive, especially where such progress was thought unlikely just a few years ago. Constraints, Old and New Given a backlog of approved projects, there will likely be more capacity installed in 2019 than 2018. However, a number of developments have undermined developers’ confidence. Reverse auctions, in which prices are continuously bid down until prices fall no further, have driven solar prices down in India to less than 3 rupees (4.3 cents) per kilowatt hour. A new import tariff as high as 25% kicked in this year, aimed at solar panel imports from China and Malaysia. China accounts for 90% of panel installations in India, so this, along with a depreciating rupee, has raised costs across the board and lowered the returns that developers and investors can earn. The increasingly challenging economics of large-scale Indian solar development has forced consolidation in the market. In 2019, just 4 players Azure, Acme, NLC, and Japan’s SoftBank are expected to provide more than 40% of new utility-scale capacity. Increasingly, there are instances of auctions being run and then canceled after the market-discovered auction price was deemed too high, making the business of bidding for projects more risky for developers.  This has happened both at the state and central level and is damaging the investment environment for solar. Despite these hurdles, significant interest remains from foreign investors from Japan, the Persian Gulf, and Europe. American investors who are earning better returns at home have largely steered clear of the Indian market. Land acquisition issues continue to dog plans for some large-scale solar parks. More than 40 such parks are in various stages of planning and development. Though land forms less than 5% of typical project costs, it is often the most complex and time-consuming step.  For instance, a 500 MW park in the large state of Maharashtra was scaled back this year after a farmer protesting inadequate compensation committed suicide. A large 2 GW solar park, located in the desert state of Rajasthan, is expanding more slowly than planned due to land disputes. Also, developers often opt for acquiring fertile land rather than wasteland, as it is typically closer to existing grid infrastructure. This further increases the chances of farmer resistance. An ambitious “green corridor” project to strengthen the grid between states with large generation potential and centers of high electricity demand is ongoing, and allocations for it increased by nearly 20% this past year to $92 million. Yet, as new renewable energy gets added to the grid, the demand for greater inter-state capacity is also growing. The green corridor is effectively a moving target and is currently lagging well behind additions of new capacity. India’s electricity sector, mostly organized at the state level in India, has undergone major reforms since the 1990s. From being integrated and almost entirely government-owned in each state, the sector was “unbundled” or split up with different companies handling generation, transmission, and distribution. Along with unbundling, privatization was also pushed. However, while generation was substantially privatized, transmission and distribution remain predominantly state-owned. However, electricity subsidies for agricultural use among India’s vast farming population have also increased steadily. What that means is that distribution companies (Discoms) in most large states face significant under-recovery of costs and are saddled with huge debts. This acts as a major constraint on the expansion of solar power, as Discoms are highly reluctant to buy more electricity from renewables in the face of existing long-term contracts with coal plants. The central government launched a key initiative in 2015 to rescue Discoms from their financial distress, called UDAY. However, UDAY is largely a failure. Though stricken Discoms have temporarily regained much of their health by transferring 75% of their existing debt to state governments, the Discoms have not implemented other reforms like reducing grid losses to improve their long-run profitability. The distribution companies’ generally poor financial health thus constitutes a major barrier for renewables penetration going forward. Moreover, there are challenges and costs of grid integration associated with renewable power because of intermittency, the fact that the sun doesn’t always shine and the wind doesn’t always blow. In the absence of affordable energy storage, grid managers have to ramp up other sources of electricity to act as balancers when there is no sun or wind. Hydropower and natural gas are ideal balancing sources for variable renewable electricity. Some states such as Karnataka do have sufficient hydropower to balance their renewables generation. But, many others do not, and, in the absence of viable natural gas plants, coal plants have to play this role. However, ramping coal plants up and down is expensive. As renewables penetration increases in the Indian electricity system, these challenges will get more serious. New Solar Models – Seeds of Change? New innovative approaches suggest a different path forward. While they tend to be smaller scale, they meet the electricity needs of key constituencies and can help overcome problems of land acquisition and below-cost electricity for agricultural users.  Madhya Pradesh, a poorer state in the central part of the country, is pursuing demand aggregation to reduce rooftop solar costs and is rolling out solar pumps for farmers. The rooftop program is initially oriented towards public buildings, such as government departments, schools, universities, and hospitals. The unique aspect has been to aggregate demand for would-be developers by bundling sites together Before the bidding process, the state surveyed the sites to estimate their technical requirements and made that information available to developers. This has led to electricity price bids of less than 2 rupees per kilowatt hour in some cases, which is as much as 5 rupees cheaper than standard Discom rates. While significant subsidies of more than 40% helped facilitate lower bids, state officials argue their preparatory work and transparency of information brought costs down even further by reducing investors’ uncertainty. The agricultural sector is responsible for more than 30% of electricity demand in a number of states as many farmers rely on groundwater for irrigation. Because farmers tend to get subsidized power, many of India’s Discoms perennially lose money. However, farmers also get unreliable power for limited hours, often at night rather than during the day. The wealthier state of Maharashtra, which includes the India’s financial capital Mumbai but is also heavily agricultural, is experimenting with solar agricultural schemes to offer farmers more convenient and reliable daytime power and should help Discoms improve their balance sheets. Maharashtra has developed a solar feeder scheme which sets up a small scale solar plant of 1-10MW in the community. Farmers connect to this power plant to run their pumps. The southern state of Karnataka, which includes the national IT hub Bangalore, has innovated a semi-distributed solar model by building smaller scale parks of 10 MW to 100 MW at the taluk level (taluks are clusters of villages). Taluk-level solar plants do not require large parcels of land and can be located more closely to the rural consumers. The model could ease the land challenge, lower grid losses, and reduce Discoms’ financial losses. Karnataka also innovated a land leasing model for its large 2 GW Pavagada solar park located in a poor drought-stricken region. Instead of acquiring farmer-held land outright, it offered 28-year leasing deals. 13,000 acres were acquired this way, with thousands of farmers signing lease contracts. In exchange, farmers are paid an annual rent with a periodic escalation clause. This eased farmer concerns over permanently losing their land and assured them a steady income regardless of the weather. Pavagada helped Karnataka become the leader of all Indian states in net solar capacity. The Current Pathway - More Solar, More Coal From a climate change and air quality perspective, the more important question is whether India’s renewables growth will displace coal as soon as is practically feasible. From that point of view, the growth of the last few years of the solar sector looks less impressive. However, from an energy security perspective (the primary driver of India’s energy policy), solar has provided a welcome, cleaner domestic source of electricity and has significantly alleviated power deficits triggered by uneven supplies of domestic coal in states such as Karnataka. Coal still retains its preeminence in India’s electricity mix, responsible for close to 75% of electricity generation. Even as some old coal burning power plants are being taken off-line, some new coal plants are being built. In recent years, renewables additions have outpaced coal; for example in 2018, renewables additions were 11.2 GW (of which solar was 8.2 GW) compared to coal additions of 4.5 GW. Though the new coal plants are more efficient supercritical and ultrasupercritical plants with greenhouse gas emissions reductions of more than 25%, they are still net carbon additive. In 2018, the Council on Energy, Environment, and Water (CEEW), a prominent Indian think tank, developed scenarios of low carbon development for India. In the most pessimistic scenario where renewables projects have to bear the cost of integrating their power into the grid, the non-fossil share of electricity will rise to at least 48% in 2030, up from around 20% today. In the most optimistic scenario in which renewables do not have to bear any cost of grid integration and coal plants operate under a new market design, the share will be as much as 79%. This is a large spread of possible scenarios, and speaks to the high sensitivity of sector pathways to policy and regulatory initiatives. In other words, much can be done to bend the curve. Peering Ahead In spite of sector headwinds, more than 13 GW of solar will be added this year according to Bridge to India, of which 10.9 GW will be utility scale and 2.4 GW rooftop. This surge is largely due to legacy effects of intense tendering activity in late 2017 and early 2018 coming online in 2019. But the overall trends of 2018 point to serious risks of a solar slowdown. If renewables are going to displace a larger share of coal in the medium-run, then some more transformational changes in how the electricity space is regulated and organized will have to be pursued. As we argue in an article forthcoming in Energy Policy, the significant growth of renewable energy in India since 2014 has very much been a top-down affair greatly driven by policy innovation and high prioritization by the central government and some key states. This policy push was driven by multiple factors including global pressures leading up to the Paris agreement, the leadership of Prime Minister Modi, and energy security and investment factors. However, the upcoming national election will likely return a more fractious coalition government, reducing the appetite for ambitious energy sector reform, all in the context of flagging global climate action. The question of electricity reform in India highlights the challenges for democracies of reconciling diverse interests and voter groups with the need to move to cleaner sources of energy.  This challenge is not unique to India. Witness the prolonged discussions in Germany over the timing and terms of phasing out coal production. The United States, with the deregulatory pushback in the Trump era, is also facing similar challenges. Solving this puzzle will be a key challenge of national and global governance in the years ahead. The authors would like to acknowledge the support of the IC² Institute, the LBJ School, and the Strauss and Clements Centers at the University of Texas.

Test your knowledge of deforestation, from its role in climate change to efforts to combat it.

This is a guest post by Benjamin Silliman, research associate for Energy Security and Climate Change at the Council on Foreign Relations.  Earlier this month, the U.S. Department of Defense (DoD) released a congressionally-mandated report detailing the challenges climate change poses to the U.S. military. Citing increased exposure to recurrent flooding, drought, desertification, wildfires, and thawing permafrost, the report highlights how climate change affects U.S. military readiness to respond to national security emergencies. The report includes a list of selected events where mission related activities at military installations were compromised due to environmental vulnerabilities as well as a brief list of policies taken to mitigate future damages. To quantify the extent to which the military is threatened by climate change, the report tracked seventy-nine priority American domestic installations chosen by their critical operational roles. While the public report was circumspect on details given the sensitive strategic nature of the subject, it did identify climate change as an important and tangible threat to the U.S. military. The report represents another in a series of public acknowledgements that spans four administrations that the military is not immune to extreme weather. Last year, numerous concrete examples raised public awareness of the issue. In October, category four Hurricane Michael thrashed the Florida coast with winds reaching one hundred and thirty miles per hour on Florida’s panhandle. In its way was U.S. Air Force Base Tyndall, which houses not only the headquarters of the Florida Air National Guard, but also the 325th Fighter Wing, a major combat force of F-22 Raptors and a principle training center and testing site for their pilots, maintenance crews, and equipment. The base, like surrounding civilian areas, was not able to regain a normal operating status for almost a month. During the recovery period, critical training and maintenance schedules for the almost a third of the nation’s F-22s was disrupted, forcing the fighter jets to relocate to other regional airbases less able to run such a high volume of them. Additionally, rebuilding has been costly and time consuming, thereby diverting man-hours and resources that could have been spent on other matters. The situation starkly demonstrates how a severe weather event can be tumultuous for critical but routine activities such as patrolling and training. Tyndall is not the only base exposed to weather related threats. Of the seventy-nine installations analyzed in the report, 67 percent reported that they are currently facing problems from recurrent flooding, and 76 percent reported that flooding has the potential to create vulnerabilities in the next twenty years. Acute extreme weather events, like hurricanes, have a higher probability of occurring in the future due to climate change. This means there is possibly more stress that could come to Tyndall and other coastal bases in the future. California’s wildfires have also taken their toll on nearby military bases. The Marine Corps Mountain Warfare Training Center, which is based near the Sierra Nevada, was forced to evacuate in September of last year when wildfires got too close. According to the DoD report, 46 percent of the installations analyzed are now vulnerable to wildfires. This is in addition to facility vulnerabilities from drought, which, in turn, increases the risk of fire in Western Regions of the country. Stressed water supplies from extended periods of drought can also require contingency planning for when bases are must be temporarily put out of commission. Of course, protecting operational bases against severe weather events is not the only worry the military has in the face of climate change. The warming of the poles has also opened a new strategic landscape which directly connects the United States and Canada to Russia and China via the Arctic Ocean. As ice that used to cover the ocean melts and it becomes possible to move significant traffic through the area, policing the region against China and Russia will become a critical, and expensive, mission for the U.S. Navy. Arctic ice melt will also increase the extent to which foreign military vessels have access to North American shores. Beyond direct U.S. military activities related to the homeland, the DoD report mentions that the U.S. military carries out significant humanitarian and disaster relief efforts, as directed by the United States Agency for International Development (USAID). If climate change does lead to an increased severity of global natural disasters, the military may need to expand its capacity to deal with traumatic events in different parts of the globe, on top of expanding requirements and strains at home. Climate change also threatens increased destabilization in regions outside of the United States, which may put strain on deployed troops or even require U.S. military intervention. Sea-level rise could threaten rapidly developing cities along the coast of Africa like Mogadishu, Djibouti City, and Mombasa with damaged infrastructure and compromised water supplies. Any major displacement from these major cities would be a geopolitical risk and put even more strain on the already stressed global immigration channels. This could also cause an increase in piracy if economic conditions deteriorate around the Horn of Africa. With so many present and future challenges being exacerbated by changing global climate patterns, it is important that military leadership internalize these threats and examine the entire military system to prepare for the challenges it will be facing. The DoD report lists some of the activities currently being undertaken by the military. Major initiatives include designing construction standards to better withstand natural events and developing research programs to better understand facility risks from environmental vulnerabilities. However, the report was very limited in its scope as compared to the mission of the DoD. For example, it neglected to cover international installations or the Marine Corps. It also did not provide congress with strategies to prioritize resources for mitigating future threats. Moving forward, the DoD should expand on the initial report to fill in missing gaps and provide congress with more actionable budget recommendations. Specifically, DoD should develop and maintain a separate fund dedicated for research and systematic improvements to address these environmental vulnerabilities. The DoD should also commission robust studies for each Geographic Combatant Command to better understand how climate change may impact each region of the world in which the United States has strategic or militaristic interests. This will be important for understanding how climate change could impair access or movements of deployed troops and equipment and allow the military to improve planning for future types of climate-related missions the military may have to conduct. Contingency plans are needed for vulnerable bases that might need to be evacuated or otherwise go offline due to a natural disaster. Dangerous skepticism at the highest levels of political leadership can still limit the DoD’s ability to respond adequately to the changing world. The report was sent directly to Senator Jim Inhofe, chairman of the Committee on Armed Forces, who is notable for his speeches on the Senate floor denying the existence of climate change. What Congress decides to do moving forward from this initial report could have lasting implications for national security. Congress could call for more robust analytical reports and create new funding channels to drive research and preparation for environmental specific threats, or Congress could ignore the report, claiming satisfaction, and leave the military scrambling to work on this important issue by diverting resources from other budgets and performing sub-par preparation. So far, little news has surfaced from Congress about the report, indicating that it may be business as usual for the DoD.

Nature and technology pose a worrying array of threats to twenty-first century civilization. These global menaces and the catastrophic risks associated with them are the subject of a new International Institutions and Global Governance program blog series. 

In an article recently published in Foreign Affairs, Joshua Busby and Nina von Uexkull identify the countries that are most at risk from climate-related instability and humanitarian crises.

Fifty years ago, a photo of Earth rising beyond the lunar horizon captivated the world and inspired the modern environmental movement. Humans have since despoiled the planet to the brink of environmental catastrophe.

Climate change and the environment feature prominently in 2019's global summit lineup.

Samir Saran is the President of the Observer Research Foundation. Aparajit Pandey is the Program Director for Climate, Energy, and Resources Program at the Oberver Research Foundation. As leaders gather in Katowice, Poland, for the Twenty-Fourth Conference of the Parties (COP24) to the United Nations Framework Convention on Climate Change, the possibility that India can shift to a new low-carbon growth model is a critical test for a global pact on climate change mitigation. India will be one of the first countries to transition from low- to high-income economy in a fossil fuel–constrained world. While American leadership reneges on its climate finance commitments towards the global community, India is taking a lead to develop its economy largely through its own political and financial arrangements. Done correctly, the method and mechanics of India’s low-carbon transition can provide a replicable template for energy development across the world—especially for mitigating carbon emissions, ensuring affordable energy access for all, and eradicating poverty. A study of India also provides assessments and recommendations that can inform development efforts in Africa, Latin America, and Southeast Asia. In the space of two years, India’s solar and wind energy prices have fallen dramatically, undercutting average coal prices by approximately 25 percent. At the same time, investments in clean energy projects have risen rapidly, with $42 billion flowing into Indian renewable energy projects over the past four years. These optimistic figures, however, should not hide the fact that the lower rates charged by renewable energy power producers are predicated upon two volatile factors: the price of materials and government policies. Prices of renewable energy components are vulnerable to shifts in trade policy, currency depreciation, or changes in supply and demand. Moreover, with renewable power prices dropping, both central and state governments are reassessing the need for the limited incentives and subsidies they provide. In India, the resulting clean energy sector optimism over the past few years has skirted over some serious fissures in the foundations of the architecture. Firstly, India’s public power distribution companies (DISCOMS) remain a gordian knot that the government has not been able to untangle. The issues with DISCOMS remain related to three distinct factors: poor pricing models due to political interests, weak corporate governance, and ailing infrastructure. Any measure to reform the sector needs to account for all three factors. Secondly, India’s energy sector suffers from a lack of developed local financial markets. Debt-financing options for renewable energy projects remain limited within India because the shorter terms of saving instruments inhibit long-term domestic bank loans. Under normal circumstances, this asset and liability mismatch can be bypassed through alternative debt instruments. Use of financial vehicles such as bonds or infrastructure investment funds, however, remains limited in Indian and other emerging markets. The loans that have been given out to the clean energy sector have largely been driven by short-term macroeconomic factors such as excess capital liquidity (a byproduct of India’s 2016 demonetization reform). As the Indian banking sector hovers on the precipice of a crisis, it is likely that domestic debt financing for these projects will quickly dry up. Finally, the risk premium that international commercial banks charge for operating in emerging economies such as India remains an unsurpassable barrier. ReNew Power, India’s largest renewable energy company, raised a $450 million bond issuance in 2017. But the bond was several levels below what was considered an investment grade rating, despite ReNew’s excellent business fundamentals and backing from Goldman Sachs, the Abu Dhabi Investment Authority, and the Green Environment Fund. Since the issuance of the bond, the firm has grown exponentially, cementing its place as one of India’s premier energy producers—demonstrating that projects and companies could be evaluated more independently of sovereign ratings.  We recommend that India reform power grids by implementing hybrid public-private systems. The Indian state of Gujarat is the exception to the country’s DISCOM issues, with all four of the state’s utilities currently showing profits. Gujarat’s path could be a model for other parts of the developing world. On financing, direct economic interventions designed to bolster debt financing are not always viable. To increase the availability of debt financing for clean energy projects in emerging markets, policymakers can encourage the creation of alternative debt vehicles. “Green” asset backed securities are one such alternative. Securitized debt has been a largely overlooked financial instrument outside of the developed world, but recent reforms have shown the potential of the asset class in emerging markets. By compiling renewable energy assets that come from different companies and geographies at various points in their operational lifecycles, banks and other financial institutions can dilute many of the risks associated with individual renewable energy projects. To further mitigate risk through diversification and bolster the credit rating of a securitized instrument, the financial creator of the asset can also add a tranche of non-green assets. The proceeds from selling the security can then be used to finance new projects, which can in turn be securitized themselves, creating a virtuous cycle. Another alternative to traditional debt could be developed through the creation of “green” investment banks (GIBs). GIBs are government-funded entities that “crowd in” private investment in low-carbon assets and operate like a normal investment bank, albeit with a sectoral bias. They can provide debt for projects with existing capital reserves and raise funds through the issuance of bonds and creation of asset-backed securities. They can also invest as equity partners, developing projects and conducting due diligence, if needed. The value of GIBs comes from their flexibility and ability to adapt to market conditions and trends. Moreover, GIBs have sectoral experts whose skillsets allow them to understand public- and private-sector dynamics and deal with a variety of transactions. Finally, Basel IV, the proposed reforms for the global banking regulatory framework, should include climate change in its assessment criteria—either by measuring the exposure of a bank’s portfolio to climate change–related damage or by implementing a green factor on the weighting of risk for renewable energy projects. The significance of India’s development choices should not be underestimated. If the success of the Millennium Development Goals was predicated on China’s economic rise, India’s capability to replicate the same in a carbon-scarce world will determine the fate of the UN Sustainable Development Goals. This blog is excerpted from the Council of Councils Global Governance Working paper, “India and the World: Fueling a New Low-Carbon Growth Model.” Read the full paper here.

As in the rest of the world, the impacts of climate change are unlikely to abate anytime soon in West Africa. In Nigeria, the devastating effects of climate change are in full view. The low-lying coast off the Gulf of Guinea is especially vulnerable to rising sea levels, the Sahara has expanded about 10 percent since 1920, and natural disasters appear to be on the rise. In 2017, flooding affected an estimated 250,000 Nigerians; in 2016, 92,000 were displaced. At the other end of the climate spectrum, up to 40 percent of the country’s land area is now estimated to be subject to periodic drought.  Uncontrolled urbanization and rapid population growth, without the expansion of the necessary infrastructure to address them, will exacerbate the destructive force of natural disasters. Nigeria is now about half urban, and the population is expected to grow from 200 million people to perhaps 450 million by mid-century. Climate change is not a subject of popular debate in Nigeria, but there is widespread discontent with how the government responds to natural disasters. The Nigerian Emergency Management Agency (NEMA), similar to its American counterpart, FEMA, is on the front line of providing relief to the victims of natural disasters and plays a major, if not exclusive, role in the relief of internally displaced persons. Nigerians appear to have a low opinion of NEMA’s capabilities. Reform, for its own sake, is badly needed. It will likely require extensive personnel house-cleaning and the assurance of a steady revenue stream. Closer NEMA cooperation with international relief agencies so far as been disappointing, and it might well require presidential leadership, given a general Nigerian aversion, rarely articulated, to partnership with international agencies. But corrupt and weak institutions are notoriously difficult to reform, as the shortcomings of President Buhari’s anti-corruption campaign illustrate. Nevertheless, reforming NEMA should be fiscally feasible and—important to any incoming administration—would be publicly visible. Such reforms might be taken by Nigerians as a down payment by a new or a second-term administration for a commitment to more extensive reform. It therefore presents itself as an opportunity to the incoming Nigerian administration to rebuild trust with the citizens it is sworn to protect. 

The conference in Poland will be a major test of the world’s collective political will to fight global warming. Following through on promises made in Paris will not be easy.

As European voters look for new alternatives, Green parties are making waves across the region. In doing so, they could signal a counterweight to the populist European right and influence national and European climate policies.