India moves up to 74th position on Global Energy Transition Index
With moving up to 74th rank, India has shown improvement in key parameters of economic security, economic growth, and environmental sustainability.
World Economic Forum (WEF) announced that India has moved up two positions and has ranked 74th on a global energy transition index. WEF released the annual rankings on May 13, 2020.
With a better ranking, India has shown improvement in key parameters of economic security, economic growth, and environmental sustainability.
WEF is a Geneva-based international organisation that is for public and private cooperation. Releasing the ranking it further stated that the ongoing COVID-19 crisis will compromise the transition to clean energy by both the developed and developing countries.
• World Economic Forum in its report stated that as per its study for measuring the readiness for the transition to clean energy, out of 115 economies 94 have shown progress since 2015. But even with the progress, environmental sustainability is still behind.
• Sweden has acquired a top position on the Energy Transition Index (ETI) for the third consecutive year and has been followed by Finland and Switzerland in the top three.
• Out of G20 countries, only France at 8th rank and UK at 7th rank have been in the top 10.
• As the emerging centres of demand, India at 74th and China at 78th rank have shown efforts for enabling the improved environment. It has resulted from consumer engagement, political commitments, innovation, and improved infrastructure.
• In China specifically, the air pollution problem has resulted in policies of electrify vehicles, controlled emissions, onshore wind plants, and the world’s largest capacity for solar photovoltaic (PV).
Improvement in India’s ranking in global transition index:
As per WEF, India has become one of the few countries in the world that have shown consistent year on year progress since 2015. This consistency shows the strong positive trajectory that has been driven by enabling environmental sustainability and strong political commitment.
The improvement in India’s ranking in the Global Energy Transition Index has been due to the government-mandated renewable energy expansion program, which has now been extended to 275 GW by 2027.
India has also shown significant efforts in energy efficiency through smart meters, bulk procurement of LED bulbs, and programs to label the appliances. A similar form of measures has also been experimented for driving down the cost of electric vehicles.
The progress in India’s position is due to the improvement in all the three dimensions of the energy triangle- energy access and security, economic development and growth, and environmental sustainability.
Impact of COVID-19 on clean energy transition and what can be done:
As per the World Economic Forum, the COVID-19 pandemic risks the recent progress in the transition to clean energy. The impact can be in the form of price volatility, unprecedented fall in demand, and the increasing pressure for quickly mitigating the socio-economic costs.
The pandemic has forced the companies across the industries to adapt to changes in demand and new ways of working, operational disruption while governments have also introduced economic recovery packages to help in coping with these effects.
As per WEF, the ongoing situation offers an opportunity to consider unorthodox intervention in the energy markets as well as encourages global collaboration for the recovery that will accelerate the energy transition once the crisis subsides.
WEF’s report in 2020 suggests that roadmaps, policies, and governance frameworks for energy transition at global, regional, and national levels required to be more resilient against the external shocks.
If the policies can be implemented with long term strategies, they can accelerate the transition to clean energy by helping the countries in expanding their efforts towards inclusive and sustainable energy systems.
Economies performance on energy transition index:
• The index benchmarks 115 economies on the performance of their energy systems across environmental sustainability, economic growth and development and energy security and access indicators as well as their readiness for the transition to sustainable, secure, affordable, and inclusive energy systems.
• The 2020 result shows that 75% of the countries have shown improvement in their environmental sustainability. It is a result of incremental approaches, retiring coal plants ahead of schedule, including pricing carbon and redesigning electricity markets for renewable energy resources.
• This progress also highlights the limitations of relying on incremental gains from existing policies and technologies.
• Emerging economies have shown the greatest overall progress, although signaling for urgent need amid the COVID-19 crisis.
• The report shows the US (32th), Brazil (47th), Canada (28th), and Australia (36th), these countries have been either stagnant or have shown a decline.
• The steady improvements shown by only 11 out of 115 countries since 2015 indicates the complexity of energy transition.
• China, Argentina, India, and Italy have shown consistent improvement. While the Czech Republic, Bangladesh, Bulgaria, Hungary, Oman, and Kenya have also shown significant gains over time.
• Scores of Canada, Lebanon, Chile, Malaysia, Turkey, and Nigeria have declined since 2015.
• For the first time, the US has ranked outside the top 25 percent which can be due to the uncertain regulatory outlook for the energy transition.