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Transition from fossil fuels to renewable energy

  • IASbaba
  • July 12, 2022
  • 0
Economics
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In News: The global transition away from fossil fuels to renewable energy sources could trigger financial challenges for India and major developing countries because of their high dependence on revenues from fossil fuel, according to a study by the International Institute of Sustainable Development (IISD)

  • Though India is a net importer of petroleum products, it earns substantial revenues — via cesses and taxes — from the consumption of petrol, diesel and oil.
  • The study finds that by 2050, overall fossil fuel revenues in Brazil, Russia, Indonesia, India and China could be as much as $570 billion lower than a business-as-usual scenario where governments fail to phase down fossil fuels enough to avoid the worst climate impacts.
  • The widest gaps are expected to occur in India ($178 billion), China ($140 billion), and Russia ($134 billion).
  • Public revenues from fossil fuel production and consumption currently account for 34% of general government revenue in Russia, 18% in India, and 16% in Indonesia.
  • This includes only direct, first-order, government financial revenues — fossil fuel dependence would be much larger if private incomes and flow-on effects in these economies were added.
  • Fossil fuel revenue streams, were unreliable and erratic and undermined by the negative economic impacts of fossil fuel use such as health costs due to air pollution and damage from climate change.

Emerging economies have an enormous opportunity to build more resilient and economically sustainable energy systems as they decarbonise — but they must plan ahead to avoid shortfalls in public revenues that could reverse progress on poverty eradication and economic development

International Institute of Sustainable Development (IISD)

  • The International Institute for Sustainable Development (IISD) is an independent think tank working to fulfill a bold commitment: to create a world where people and the planet thrive.

Source: The Hindu

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