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Lights On Briefing: Broken solar contracts, Bangladesh methane leaks and more

What you need to know to start the week

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Lou Del Bello

Apr 12 2021

6 mins read

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Happy Monday and welcome to today's Lights On, a newsletter that brings you the key stories and exclusive intel on energy and climate change in South Asia.

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Solar incentives for Indian makers

After imposing new custom duties to penalise the import of Chinese solar modules and cells, the Indian government is now giving a boost to domestic solar makers through a much awaited set of incentives for more efficient made-in-India modules and locally sourced materials.

The Production-Linked Incentive Scheme could also attract foreign companies interested in setting up factories in India. In a statement, the government acknowledges that the new scheme is an attempt to fix the Indian solar manufacturing sector, which is still unprepared to meet the country’s growing demand, creating a gap that so far has been filled through imports, mostly from China. The expected benefits include 10GW of solar manufacturing capacity, a direct investment of $2.31 billion in solar PV manufacturing projects, and the creation of 30,000 jobs in the sector.

Plus one for net zero

Leading renewable energy firm ReNew Power has announced its plans to go carbon neutral by 2050, joining a growing number of countries and businesses that pledged their own version of a net zero target. The company joins the global ‘Race To Zero’ campaign, which brings together cities, businesses, investors and universities across the world. 

However, the official statement is thin on details on what the ReNew Power intends to do to abate its carbon footprint, and how it will define the elusive goal itself.

Broken solar contracts

Squabbles over solar contracts could jeopardise India’s ambitious renewable targets, as more state-owned power distribution companies refuse to finalise the renewable energy deals they had committed to. This is due to the ever decreasing price of clean energy, which often makes the agreed prices not as appealing to the entity which promised to buy it. The chronic problem has become so severe in India that some analysts now suggest renegotiating the contracts - with lower tariffs - so the projects can at least go ahead. Currently, 19GW of renewable capacity are stuck in limbo as distribution companies refuse to sign power purchase agreements tied to the plants’ development.

Analysts warn that the uncertainty of the situation could discourage investors from betting on India’s renewable space.

Businesses tap into hydrogen promises

Indian conglomerate Reliance Industries teamed up with Chart Industries, a US based company specialised in cryogenic equipment to create a new energy transition coalition focussed on hydrogen technologies. The India H2 Alliance wants to foster a hydrogen-based economy by creating supply chains and boosting research and development in the field. 

While the group did not provide a timeline for its plans, it has said it will target industrial clusters, in an effort to decarbonise sectors such as steel, refineries, fertilisers, cement and heavy duty transport.

 

Bangladesh


Methane leaks

Bangladesh has one of the highest methane emissions in the world that can be detected by satellites, analysts have discovered. Using data from the European Space Agency, researchers have discovered that the country is a major contributor of the potent greenhouse gas, which in its first two decades in the atmosphere traps more than 80 times the heat of carbon dioxide.

While analysts were unable to pinpoint the exact source of the leaks, the Bangladeshi environment ministry said it is aware of the problem and the leaks are mostly caused by rice paddies and landfill gas.

Nepal


Hills on fire

Nepal is facing the worst forest fires in years, according to officials, with 60 areas burning across 22 of the country’s districts. The emergency is also aggravating the air pollution crisis in the capital Kathmandu as the smoke concentrates in the valley where the city is located.

Officials in Nepal said that this year has seen 15 times the number of forest fires compared to 2020. As India’s northern states battle a similar situation, activists are blaming climate change for the exceptionally dry conditions that led to the fires.

Bhutan


Disputed sanctuary

China and Bhutan have taken steps to address a long standing border dispute involving a remote wildlife sanctuary. Last summer, China opposed Bhutan’s request for funding to the Global Environment Facility, to be spent for the preservation of the  Sakteng Wildlife Sanctuary, claiming that managing the reserve was a way of appropriating a disputed area.

In a last round of talks, China defended its claims over the sanctuary but proposed an (unspecified) ‘package solution’ insisting that this is the only way to solve the stalemate.

This week on Twitter

Research and further readings

  • Explainer: Why forest fires break out in the spring, and why they have been so frequent this year - This year’s forest fires sweeping through the north of India have been more frequent than usual, particularly in the state of Uttarakhand. While dry soil caused by a weak monsoon is being seen as one of the causes, fires of longer duration, increasing intensity, higher frequency and highly inflammable nature are all being linked to climate change.
  • Long read: How Andaman Islands Are Losing Green Protection Against Business & Tourism - The government plans to open up the secluded Indian archipelago to economic development, but this comes at the expense of its unique biodiversity and threatened communities who live in the islands, whose population is now in decline.
  • Long read: The damaging effects of climate change on Indian industry - As heatwaves become longer and more intense, not only will India have to find solutions for extreme temperatures, but also for what scientists call chronic heat. According to estimates, if the world heats up by even 3C above pre-industrial levels by 2100, India would see anywhere between 100-250 days of dangerous, constant heat, which would come at great health, environmental and economic cost.


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