Altaf Qadri/AP Photo
A man climbs a steep ridge with a basket of coal scavenged from a mine near Dhanbad, an eastern Indian city in Jharkhand state, September 24, 2021.
The northeastern Indian state of Jharkhand literally means “land of forests” in Hindi. Nearly 30 percent of the state is covered in dense, mist-laden forests inhabited by tribal groups. But underneath the trees lie abundant deposits of iron, copper, uranium, and, most significantly, coal—mineral riches that have become a climate curse.
Five thousand miles separate Jharkhand from Glasgow, the site of the latest, and increasingly dire, worldwide summit to address climate change. Yet to understand the distance between international promises to reduce greenhouse gas emissions and on-the-ground realities, all roads pass through states like Jharkhand, where over 300,000 people are directly employed by the coal sector, and easily a million more indirectly. How India and the world address this region’s coal dependence will determine whether the state becomes a success story or a casualty of the energy transition.
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Coal accounts for 70 percent of India’s power generation. While it contributes about 2 to 3 percent to India’s overall GDP, in mining states like Jharkhand, that number jumps to 8 percent. In a recently released study, Sandeep Pai, a native of Jharkhand and senior associate at the Center for Strategic and International Studies, describes coal in India as an “ecosystem” that extends far beyond a jobs problem. State-owned Coal India Limited, the world’s largest coal miner, provides billions of rupees to the government in the form of taxes, dividends, and royalties. Even as it damages health and the environment, the industry also fuels welfare programs, including coal worker pensions, and provides critical revenue to the Indian Railways system, one of most extensive in the world, that keeps passenger ticket prices exceptionally low.
There is no simple solution to replacing coal in the region. Potential other sectors—tourism, mining of other minerals, agriculture, manufacturing, renewable-energy production—are underdeveloped. Diversifying the state’s economy beyond coal requires intense community-level engagement that involves everyone from laborers to unions to corporate managers. “If you go to Jharkhand, most people haven’t heard of a ‘just transition’ from coal. The people involved in the coal sector don’t see any other options besides coal. You need to show what a post-coal future can look like and solicit ideas. Workers have in-depth knowledge about what can be done. But we have to do this now before the issue is politicized,” says Pai.
Germany’s North Rhine region, the world’s largest producer of lignite, the most polluting of coal types, is often upheld as an example of a just transition. Yet the shift there is still a work in progress. Germany announced last year that it would phase out coal entirely, but not until 2038, and lignite still accounts for 16 percent of the country’s energy generation.
“Germany has been able to talk so boldly about coal because it has the positive experience of the Ruhr valley,” says Srestha Banerjee, the just transition director at the International Forum for Environment, Sustainability, and Technology (iFOREST) in New Delhi. And getting to a politically viable announcement for a coal phaseout in Germany took decades of painstaking community-level planning and input from a unionized workforce, even with a relatively strong social safety net for workers to fall back on.
India has the added challenge of a staggeringly large informal workforce attached to coal, with some estimating there are as many as 20 million noncontractual workers across the country in coal-dependent industries. In his book Total Transition: The Human Side of the Renewable Energy Revolution, Pai describes the plight of “coal-cycle wallahs”—informal workers who transport coal to nearby cities in burlap bags strapped to bicycles. Often, entire families are involved in the scavenging, washing, and processing of coal to make it sellable. The work is backbreaking, but alternatives are few and no better.
Swati D’souza, a lead climate researcher at the National Foundation for India, has conducted an in-depth analysis of the jobs and socioeconomic profiles of Indian coal workers. She says that the starting point for retraining programs is significantly lower than in other countries. “If you want to stop the next generation from going into coal mining, you have to step back from the energy sector for a moment and invest in health and education. Otherwise, if mining declines, people will only see pathways through migration or agriculture, a sector already coping with its own climate-related crisis.”
To make coal communities more resilient before the industry shrinks dramatically, states and districts need investment. One pot of cash is the country’s “coal cess,” essentially a tax on coal established in 2010 with a goal of promoting clean-energy initiatives. The fund has raised billions, but much of it has been diverted to states as compensation for gaps in tax collection, a long-standing challenge. Now, increases in both coal prices and demand have led to a looming energy crisis, and many are calling for the tax to be canceled.
Even with improved governance, domestic funding will not be enough to meet India’s targets for expanding renewable energy and reducing coal dependence.
A second source of funding is the District Mineral Foundations (DMFs), nonprofit trusts set up in 2015 in a bid to reverse injustices that people have suffered in mining-affected areas, while experiencing few of the economic benefits. The public funds could support substantial socioeconomic development; an estimated $2.8 billion has been collected in coal districts thus far, which is promising. However, implementation has been problematic. The fund was supposed to include local stakeholders, including tribal populations affected by land displacement and livelihood loss, in the decision-making process, but Banerjee of iFOREST says that largely hasn’t happened.
“At the district level, people either don’t know about the money or aren’t sure how to implement it. Local managers need support and oversight with planning long-term investments, like in education and health care, rather than focusing on just short-term gains and building physical infrastructure like roads and bridges,” says Banerjee, who has been advocating for strategic capacity building at the local level to better manage these largely underutilized funds.
But even with improved governance, domestic funding will not be enough to meet India’s targets for expanding renewable energy and reducing coal dependence. Global climate financing is becoming more critical as climate impacts accelerate and time runs out. During his address to world leaders at COP26, Indian Prime Minister Narendra Modi made a surprise net-zero pledge by 2070 and asked for $1 trillion in climate finance for developing countries. “Justice would truly be served if pressure is put on those countries that have not lived up to their climate financial commitments,” Modi said, referring to wealthy nations’ failure to follow through on a decade-old promise of $100 billion in annual climate financing to developing countries starting in 2020.
A World Resource Institute report from October outlines that the U.S. should be responsible for upwards of 40 percent of that sum, based on its wealth and historical contribution to greenhouse gas emissions. But it has so far contributed less than $8 billion, with a pledge of only $3 billion more last week. Other countries, including France and Japan, have put in more than their fair share, but a lot of that money has come in the form of loans, which developing countries say are problematic.
“Increasing the financial burden on countries with already battered economies due to COVID will make it harder for them to take action on emissions,” says Surabi Menon, a climate scientist and vice president of global intelligence at the ClimateWorks Foundation. “You’re actually creating distress and excessive debt, limiting [these countries] from raising their climate ambitions.”
At the same time, financing needs to allow money to flow where it can have the greatest impact. Investing in India’s solar capacity, experts say, is redundant at this point, as the nation is meeting those targets on its own. But solar capacity is not the same as solar deployment. To meet Modi’s ambitious goal of generating 50 percent of India’s electricity from renewables by 2030, or even by 2040, the country needs massive investment to update crumbling grid infrastructure, extend transmission lines, and ramp up battery storage.
India is currently engaged with the World Bank to secure $1 billion to support the repurposing of closed mines, including a provision for the socioeconomic health of local communities. Between 2008 and 2020, 120 open pit mines have been shut down, but making the land hospitable to new, greener industries requires serious environmental remediation and strong land use guidelines. The World Bank’s commitment, if it comes through, offers a glimmer of hope.
Altaf Qadri/AP Photo
A man pushes his bicycle, loaded with sacks of coal, early in the morning through a street in Dhanbad, in Jharkhand state, India, September 24, 2021.
Climate finance experts say that the still largely ignored elephant in the room is global fossil fuel subsidies, which the IMF estimates at nearly $6 trillion. Removing such subsidies alone would drive down emissions anywhere from 5 to 11 percent. Reinvesting the money into climate mitigation projects would further amplify the benefit.
According to an International Institute for Sustainable Development study, Indian oil and gas subsidies have increased since 2019, while renewable-energy subsidies have fallen after peaking in 2017. The issue of subsidies is politically fraught across the globe, as consumers fear price hikes. That may change, however, as more middle- and upper-class populations experience cataclysmic climate events that disadvantaged groups have been contending with for years.
But as impacts intensify, the window for mitigation shrinks. While India needs to balance development with climate action, wealthy countries need to decarbonize faster. “When are you going to bring your emissions down to the world average, or below the world average?” India’s energy minister, R.K. Singh, chided world leaders at a lead-up to the COP Glasgow summit in March of this year. Conversely, Indian officials had balked until last week at pressures from OECD countries to set a net-zero target. The intention of net zero as it was laid out in the Paris Agreement was for the world to cut emissions as close to zero as possible and then use technological solutions to decarbonize heavy industries like cement and aviation. But net-zero declarations have not resulted in sufficient short-term actions, especially in the Global North.
“We need far better accounting of net-zero goals,” says Rahul Tongia, a senior fellow at the Centre for Social and Economic Progress in New Delhi. In his recently released report, “Flatten-the-Curve: Why Total Carbon Emissions Matter Much More Than ‘Date of Zero,’” Tongia argues that all carbon abatement is not equal, particularly when countries depend on offsets to reach net-zero targets. Offsets include carbon capture and sequestration, a still nascent and expensive technology, and which some nations, including Australia, are using as a smoke screen for increasing fossil fuel production.
While India needs to balance development with climate action, wealthy countries need to decarbonize faster.
More troubling is the focus on land use offsets, such as planting trees as carbon sinks to make up for hard-to-decarbonize industries. Often, developing countries with cheaper land are the hosts for these offsets, or other ones that offer “easy” reductions. Tongia says this leads to creative number crunching that, at best, leaves “low emission” countries with little room for further offsets they will need to decarbonize their own heavy industries. “In some cases, future avoidances are being given credit,” says Tongia. “We have to come up with a mechanism and agreement that those who are rich and high emitters have to reduce emissions earlier. Instead of 2050, it should be, perhaps, 2040, or even earlier, depending on the country.”
While over 100 countries have made net-zero pledges, a growing number of climate scientists and policy experts like Tongia say that the focus can’t avoid “carbon budgets”—the amount of carbon a country can release to stay within the IPCC’s 1.5 degrees Celsius warming threshold, which is critical to avoiding the worst climate disasters. A country like the U.S., which is already responsible for the largest share of accumulated carbon emissions, has less “budget” remaining than a country like India, which is the third-largest annual emitter but responsible for a smaller fraction of accumulated emissions. At the current rate, the U.S. would max out its “budget”—that is, exceed the amount of carbon it can release if the planet is to stay below that 1.5 degree temperature rise—in less than six years.
According to this accounting, India needs to pace itself and not blow through its carbon budget in the next 20 years, using that time to invest in states like Jharkhand and to bring down the material excesses of urban populations. In places like the United States, steep emissions reductions—and significant investment in carbon dioxide removal technologies to bring down costs—would need to begin immediately.
To call this recipe challenging is a gross understatement. But avoiding the disparity between developed and developing nations in climate commitments is yet another way of placing the burden of climate change firmly on the backs of the people least responsible for causing it, and first in line to suffer.
