Welcome a G-7 package for an energy transition

News: It’s a win for India’s diplomacy that the G7 group looks set to offer it a climate partnership deal. Unless it places an unfair burden on us, let’s use the funds to decarbonize our economy faster.

What is the Just Energy Transition Partnership (JETP)?

Upon taking over the G-7 presidency for 2022, host Germany had promised to build on Glasgow’s momentum.

Approach: The German approach includes building not just climate partnerships, but “climate and development” alliances beyond the G-7, though largely focused on G-20 members.

Significance: This is significant because this approach takes into account the societal and economic development of each partner and will not try to force-feed partners a standard solution.

The likely template will be the Just Energy Transition Partnership (JETP) that France, Germany, the UK and US, along with the EU, signed with South Africa at last year’s CoP-26.

That partnership—with special emphasis on the words “just” and “transition”—is about helping fund South Africa’s decarbonization by replacing coal usage with clean energy.

The agreement also recognizes that a departure from coal cannot happen overnight, and a big move away from carbon emissions would require options for the vast number of people employed by coal-based power plants.

At its core, the idea is to assist green transitions by making finance available from developed countries, multilateral institutions and groups of green investors.

What is the climate deal being offered to India by G7?

The US and Germany have proposed a G-7 partnership with India to support and fund the makeover of its energy mix from fossil fuels to carbon-neutral sources.

Such a deal is likely to be announced later this month at the G-7 summit in Schloss Elmau, Germany, should New Delhi and the seven agree to the JETP on the table.

India is a special invitee to this year’s summit, along with Indonesia, South Africa, Senegal and Argentina.

Constituents of the deal: If reports of the offer are true, a critical portion of the pact will ask for a) reducing the number of coal-burning power plants under development, and b) gradual closure of our coal mines.

This could be a sticking point. It would also shine a light on some G-7 members that have made negligible efforts to reduce domestic demand for fossil fuels (such as the US).

Way forward

The JETP project can be seen as an effort towards Paris Agreement’s promise of $100 billion in annual funding for countries like India that had gone unfulfilled.

Source: This post is based on the article “Welcome a G-7 package for an energy transition” published in Livemint on 13th June 22.

Print Friendly and PDF