Wealthy economies must help with financing India’s energy transition, according to a Bloomberg report, citing India’s Environment Secretary, Rameshwar Prasad Gupta.
“Every policy decision has a cost to the economy. Going net-zero or using less carbon also has a cost,” Gupta said in an interview. “We are not anti-net-zero. But without adequate climate finance being definitively available, we can’t commit on that part.”
The official’s comments add to worries about the cost of the energy transition, especially for poorer economies. Last week, Reuters reported that these worries are spiking in Europe, where poorer Eastern European members of the EU will have a hard time giving up fossil fuels. The EU plans to penalize noncompliers with higher carbon emission prices, which are likely to be passed on to end-consumers.
India’s situation is even more complex. The country is the world’s third-biggest emitter of carbon dioxide, but shifting away from fossil fuels to renewable energy will be financially challenging. This may bust the myth of cheap solar and wind power but it also highlights the difficulty in distributing the cost of the transition.
“We have our own developmental imperatives,” Gupta explained to Bloomberg. “If you want that I don’t emit carbon, then provide finance. It will be much more than $100 billion per year for developing nations.”
Because of these cost challenges, India has no plans to update its emissions reduction target, dubbed the Nationally Determined Contribution, which it released in 2015 and was expected to revise by 2020. “This is not the final decision, but most probably we won’t file a revised NDC,” Gupta said. “Let there be a decision on climate finance first.” India is not the only one asking for financial help before it commits to net zero. Brazil also recently bound its emissions commitments to foreign help to the tune of $10 billion annually.