Equity must underpin energy transition policy

The government is struggling to impose effective regulations to reduce overall emissions. One contention is the equity of solutions: Producers of smaller petrol vehicles are ranged against producers of larger electric vehicles (EVs). Another is the overall environmental impact of electric versus petrol vehicles. How the authorities view these contentions could be indicated in the Corporate Average Fuel Efficiency-3 (CAFE-3) norms, expected to be finalised soon. Additionally, the ongoing energy crisis due to the conflict in West Asia brings to fore the urgent need to look inwards, at our own strengths and promote green alternatives such as solar, biofuels and green hydrogen.

The environmental impact of a product at its point of use is a small fraction of the overall environmental impact of the system that produces and services the product. Environmental scientist Vaclav Smil has computed the total consumption of non-renewable material and energy resources in modern transportation, food production, and other industrial systems. He explains that electric cars cannot be better than internal combustion engine (ICE) cars until all the energy required to produce them and provide power to their batteries is produced from renewable sources. Till the time the power source from which a car running in Delhi draws power from renewable energy, the use of EVs will continue to pollute the environment. It will merely transfer the burden onto other locations, out of our sight.

The climate crisis has been fuelled by the relentless drive to increase the productivity of economies and improve lifestyles by replacing the use of energy of humans at work and at home with energy extracted from the Earth’s resources. Wood fire was the first technological advance of humans over other animals. Coal was tapped next, a denser source of energy which required more technology but produced more energy.

Then came the extraction of energy from hydrocarbon sources, with which the pace of industrialisation and economic growth accelerated. These combined factors have led to the climate crisis and the search for renewable sources of energy. Even today’s Artificial Intelligence algorithms, which are expected to improve living standards everywhere, are supported by large data centres running on massive amounts of electricity.

There is no escape from the universal law of conversion of material energy. All energy is derived from materials. The amount of energy that can be extracted from materials is limited by Einstein’s famous formula.

The Earth is a complex system of materials and energy. The tapping of so-called renewable energies too alters the configuration of the Earth’s material structures with long-term consequences. Think large dams, mining done to make components of wind farms, and nuclear waste — all of this alters geology, soil chemistry and, ultimately, the environment, but likely not to the degree that hydrocarbons do. Though immediately increasing the availability of low-cost energy, these large-scale solutions harm livelihoods and lives in the long term. The only additional “new energy” comes from the Sun.

The paradigm of economic growth in rich countries is not sustainable. Mankind’s global footprint — which is a measure of the pressure human activity exerts on the resources of the Earth — was 60% of the planet’s capacity to renew itself in 1960. It has now reached 130%. We are no longer living off the consumption account; we are eating into our natural capital.

The US’s footprint on the Earth’s resources is as heavy as 9/10 hectares per person. China’s is one-sixth of the US. And India’s is half of China’s. An Indian consumes one-twelfth of the Earth’s resources compared to an American. As encouraging as this statistic is, further use of all possible options — be it CNG, hybrids or smaller cars that reduce consumption of the Earth’s resources — should be encouraged.

The United Nations’ sustainable development goal, SDG 7, “aims to ensure universal access to modern, reliable, and sustainable energy by 2030”. Even the poorest human beings are entitled to adequate and affordable clean energy. Herein lies a core problem of 21st century economics. Who will pay for the energy they must have if they cannot pay for it themselves?

Policies to promote clean transportation must keep two objectives in mind — reduction of non-renewable resource consumption overall and equity in promotion of new technologies. First, what is the per capita total system’s consumption of energy per kilometre of travel among heavier and lighter vehicles? Second, are the subsidies helping poorer people improve their standards of living with affordable, safe transportation, or are they merely enabling richer people to maintain their lifestyles and feel good about their environmental consciousness with green plates on their heavier vehicles?

Studies show that globally, all major automotive markets such as the US, China, Japan, Korea, and EU, offer regulatory protection to small cars under their emission policy frameworks due to their environmental and socioeconomic value. In contrast, India’s linear, weight-based approach penalises lighter vehicles with disproportionately stringent CO2 targets. This creates a structural bias where heavier vehicles with higher emissions comply easily, while small cars with lower emissions fail. Lightweighting, a key decarbonisation strategy, is thus disincentivised.

It will, therefore, be interesting to watch how the ongoing wars, and the recent disruptions in rare earth supply from China or any other external exposure shape automotive and emission regulations. The need of the hour is to provide the customer with multiple low-energy options, and not just mandate EVs, which remain out of reach for the average middle-class car buyer.

Arun Maira is author of Reimagining India’s Economy: The Road to a More Equitable Society, and former member, Planning Commission. The views expressed are personal