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Governing clean energy in India

All countries are facing challenges of promoting energy security, tackling energy poverty and accelerating the de-carbonisation of their economies to address climate change. In governance terms, India presents a challenging and important case for domestic energy planners and international climate policy advocates. It is a large greenhouse gas (GHG) emitter with chronic shortages in electricity supply, fast growth in consumption among a small urban elite, and persistent energy poverty. This paper looks at the ways in which clean energy is being governed in India. It analyses and seeks to explain the nature of governance arrangements and policy-making processes around the development of energy sources and technologies defined as ‘clean’ by the Clean Development Mechanism (CDM).

In India, the paper finds that:

  • governance, politics and institutions are important in understanding how and whether CDM is capable of producing social and development benefits while levering additional sources of clean energy finance
  • political barriers to uptake of CDM run deeper than both carbon markets and the scope of technocratic or managerial reform programmes
  • governance and politics are integral to ensuring coherence and to managing the potential trade-offs between energy security, alleviation of energy poverty and addressing climate change
  • policy coherence, institutional coordination, accountability and barriers to participation are conceived as products of various actors’ power and influence over policy-making and the CDM administrative processes.

The paper makes the following observations about CDM in India:

  • it is important to appreciate the ‘governance in practice’ of market-based CDM
  • the extent to which the CDM can fulfill its dual aims of creating sustainable development benefits and emissions reductions is dependent on the broader institutional environment of energy policy and the political structures of the domestic energy sector
  • the influence and power of various actors shapes the extent to which national policy is coordinated towards particular public goals and reflects particular interests in attempts to simultaneously address climate change, energy poverty and energy security
  • strong and effective institutions will be required to manage these political trade-offs.

The publication concludes that there is a need for greater appreciation in scholarship and policy-making of the role that national and local energy governance plays in determining whether the CDM becomes aligned with domestic clean energy politics. This will, ultimately, determine their prospects for contributing to low carbon energy transitions in industrialising countries such as India.