Challenges Posed by Phasing Out Coal Use in India

Synopsis:

India is considering a proposal to adopt a net-zero emission target. This demands a Phasing out coal use which would pose numerous challenges. 

Background:
  • The UN has urged wealthy nations to end Phasing Out Coal use by 2030. 
  • Similarly, a private member bill was introduced in Lok Sabha in March 2021. The bill aims to adopt a net-zero emission target by 2050.
  • A lot of debates after this, have given surety of a coal use phase-out in near future
    • As the conversation on net-zero emissions has almost always come after or gone hand-in-hand with a Phasing Out Coalphaseout plan.
Challenges posed by ending coal use:
  1. Firstly, Energy Security: As currently 70% of India’s energy needs are fulfilled by coal. In 2019-20, the country consumed approximately 942 million tonnes (MT) of coal. Out of this, 730 MT was produced domestically.
  2. Secondly, Social Challenges: There would be significant job losses post the phase-out. Coal India Limited and Singareni Collieries Company Limited employ 2.24 lakh workers. Their job loss will impact almost 9 lakh people considering a four-person household.
    • Further, a setback to workers in coal-consuming sectors like power, steel, sponge iron, etc. will also be seen.
  3. Thirdly, Economic Challenges:  In FY20, the Centre alone collected approximately Rs 29,200 crore in GST compensation cess from coal. The revenue from coal allows centre and states to undertake various development activities. 
    • Similarly, 40 percent of total freight revenues in railways are generated from coal. 
  4. Fourthly, Data Discrepancies: This will hinder prudent policy formulation and adaptation plans in the future.
    • For instance, robust data on contract employees working for mine development operators (MDOs) is not available. 
    • Similarly, there is a lack of data for statecraft coal and subsistence coal economies.
      • Statecraft Coal – non-legal small scale coal mines in the northeast
      • Subsistence Coal – small-scale collieries run on village commons usually bordering formal mines.
    • Data on workers’ skill set, education parameters, caste, and willingness to migrate is also not available.  
Way Forward:
  • India must ensure adequate support for people and communities dependent on the sector. It can learn from plans of other countries like:
    • German coal phaseout plan: It seeks to end coal burning by 2038. It also involves an investment of more than 50 billion euros for mining and plant operators, impacted regions, and employees.
    • US’s Interagency Working Group: It is supposed to deliver resources that will revitalize the coal, oil, and gas communities.
    • Canada’s Phasing Out Coal plan: As per the plan, the phase-out will happen by 2030. A Just Transition Task Force has been created for the welfare of dependent communities.
  • The phase-out plan should also ensure social, climate, economic and environmental justice.

Source: Indian Express

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