Climate change in the form of global warming induced by the accumulation
of greenhouse gases in the atmosphere is already under way. For strategic
purposes, one can distinguish between the implications of a moderate increase
(20 C) and a catastrophic increase (50 C+). The moderate increase will affect
hydrology, coastal zones mountain ecosystems and biodiversity with significant
impacts on agriculture, health, settlements.
It is probably unavoidable because of the accumulation of greenhouse gases
that are already there; but we can cope with the consequences if we put our
mind and money on the job. On the other hand, a temperature increase that
approaches 50 C threatens catastrophic scale of disruption; but it may not
happen for decades. So, we still have time to prevent the worst if we start
acting now. The case for action applies as much for individual enterprises
as it does for governments. The threat is real, act now or face hugely higher
costs in the future. This is why industry must take this issue on board, and
not just as a corporate social responsibility activity.
The bottom line is that there will be an implicit or explicit price for carbon.
At the present stage, this manifests itself in India as an opportunity. Enterprises
that can prove carbon savings over and above business-as-usual can use the
clean development mechanism to earn carbon credits and sell them for compliance
purposes to western enterprises. There is now no serious penalty for carbon
inefficiency; but that will certainly change soon enough.
The Government of India will resist any premature imposition of commitments
and insist that the principal polluters, the western nations, must bear the
burden of adjustment and demonstrate a more serious willingness to restrain
their use of the global atmosphere commons before leaning on low per-capita
emitters like India. However, India has committed itself to ensuring that
its per capita emissions will at all times remain below those of the industrial
countries.
The Government has recognized the an its national Action Plan on Climate Change
integrates climate change concerns into development strategy. Indian enterprises
must also integrate climate concerns fully into their long term strategic
planning because carbon constraints and environmental changes will start to
bite within the lifetime of the investments being made now.
Second, they must anticipate. Climate change will alter the physical environment
and resource base for industry. All historical data used for planning must
be re-examined in the light of potential changes in temperature, hydrology,
sea level rise, extreme climate events and consequential changes in biotic
resources, habitat and health.
Third, they must innovate. The drastic reduction in carbon emissions that
is needed cannot be done with existing technologies. An intelligent enterprise
will reflect this in today’s decisions to avoid huge retro fitting costs
at a later stage.
The potential areas for technology development and for innovative business
models can be identified quite readily. In a summary form, some of the energy
related areas that deserve serious attention in corporate planning in the
immediate future include;
1. Energy efficiency: CFL/LED lighting, building design,
appliance standards, vehicle efficiency.
2. Cleaner fossil fuel use: Fuel switching, combustion efficiency.
3. Power from waste: Bio chemical conversion, waste water
use, sewage utilization and recycling. New business models for demand side
management.
