Global Energy Equity | 05 Nov 2022

In the run-up to the Climate Change Conference (COP26), last year in Glasgow, several developed countries had declared their intention to reach net-zero emissions by 2050. These declarations did not square with the requirements of “keeping 1.5°C alive”.

Four-fifths of the global carbon budget has already been exhausted. Developed countries are responsible for more than half of global CO₂ emission. But global energy poverty is concentrated in developing countries.

Also, the average per capita energy use of the richest 20 countries is 85 times higher than that of the 20 poorest countries.

In this background, COP27 affords a critical moment to acknowledge and address the concerns surrounding energy access and curb energy inequality.

What is Energy Poverty?

• According to the World Economic Forum, Energy Poverty is the lack of access to sustainable modern energy services.
  • It can be found in all conditions where there is a lack of adequate, affordable, reliable, quality, safe and environmentally sound energy services to support development.
• The International Energy Agency (IEA) estimates that around 2 billion people worldwide experience energy poverty.

How does Energy Inequality Relate to the Global Order?

• Energy inequality burdens the global south disproportionately.
• Poor and vulnerable communities in the energy-importing countries of the global South suffer the most.
  • Almost 90 million people in Asia and Africa, who gained access to electricity recently, cannot afford to pay their energy bills.
  • The reality of global inequality was acutely evident during the COVID-19 pandemic. Several countries in Africa, Asia and Latin America are facing severe agricultural and industrial slowdowns in the post-pandemic period.
• At a time when the language of energy poverty and security is re-entering the northern vocabulary, it is time to call out the hypocrisy of the advice on fossil use and import of fuel given by the North to some of the world’s poorest regions

What is Energy Hypocrisy of Global North?

• Commitment to Decarbonization: 30 years after acknowledging the problem of anthropogenic global warming and committing in the United Nations Framework Convention on Climate Change (UNFCCC), to take the lead in climate change mitigation, the level of decarbonisation in the global North has not matched the expectations.
  • In the United States alone, 81% of primary energy is from fossil fuels.
  • Additionally, in 2022, even coal consumption in the U.S. and the EU is estimated to increase by 3% and 7%, respectively.
• Europe’s Accusation: As part of the current global order, Europe accused India of "funding war" in the name of acquiring oil from Russia during the Russia-Ukraine war.
  • Europe’s Energy Consumption: In Europe, fossil fuels constitute 76% of the energy consumption (coal, oil, and natural gas contribute 11%, 31%, and 34% respectively).
    • The Nord Stream 1 pipeline supplies European Union states with about 35% of all the gas they import from Russia.
  • Bottom Line: In response to the accusation, the Government of India responded in the following manner:
    • If European states manage energy deals in a way that has an impact on their economy, that freedom or choice should exist for other countries as well.
    • India is working to get the best deal for its citizens amid intense volatility in global energy markets and “no political messaging should be attached to this.

What are the Challenges Related to Energy Security of India?

• High Dependence on Imports: With its growing dependency on imported oil, India's energy security is under severe strain, and the current disrupted global supply chain is compounding the problem.
• Delayed Domestic Production: Coal, oil, and natural gas are the most important sources of energy in India. A major reason for inadequate domestic supply is delays related to regulatory and environmental clearances (Mining of coal is most affected by this).
• Affordability Concern: India ranks low in affordability of petrol, notwithstanding the claims of high subsidies to oil.
  • High prices of petroleum products directly contribute to higher retail inflation.
    • Diesel prices account for 60-70% of the freight cost in India. Higher cost of freight contributes to price rise for products in every sector.

What Should be the Way Forward?

• Shifting the Focus Towards Renewable Energy Sources: Energy generated from renewable sources is cleaner, greener and more sustainable.
  • In addition to contributing to low-carbon development strategies, renewable energy projects can create employment opportunities for India's workforce.
• Energy Awareness: It is important to organise energy campaigns that promote green energy and to raise awareness of efficient energy consumption at the lowest possible level.
• Translating Goals into Implementable Action: To achieve the sustainable development goals like zero hunger, zero malnutrition, zero poverty, and universal well-being, energy security will be crucial.
  • To properly implement energy sustainability, technology options for effective utilisation of energy resources should be considered.
  • Also, there is a need to set up a monitoring mechanism at the local level to oversee implementation of policies in true spirit.
• Towards Global Energy Equity: The question of inequality in energy access should be raised squarely at the centre of all discussion in COP27. As the strapline for COP27 (“Together for Implementation”) suggests working together with burden sharing and differentiated but significant responsibilities according to respective capabilities of different countries.
  • Global intergovernmental organisation should be established dedicated to just energy transition, energy access and energy justice to move towards energy equity.