GHG abatement costs and potentials: An opportunity benefit for India through clean development mechanism (CDM)

Abstract

The economic growth and the pattern of lifestyles of nations associated with it generally determine the anthropogenic effects of human activities on the environment. This in turn affects the environmental quality. The more prosperous a country's economy is, higher is its fossil fuel consumption, resulting in higher GHG emissions. They together determine the level of production and its degree of carbon intensity1. The PET model (Michael Dalton, 2008), a dynamic computable general equilibrium model is also designed to analyse economic trade-offs associated with production and use of fossil fuels and associated GHG emissions in general and the CO 2 emissions in particular. The demographic changes i.e. the changes in population and lifestyles have enormous implications for environmental quality (Looking back to think ahead, Green India 2047, 1998). Every nation for its development heavily depends upon coal, natural gases and oil as the fossil fuels and this further release the GHGs in the environment. Generally, the increase in the emissions of GHGs is the byproduct of the economic growth and development. A country has to choose that pathway to growth, which would be sustainable by the least GHG emissions. The converse is, lower carbon emissions of a country, (CO2 being one of the major GHG causing emissions through the use of fossil fuels) it would lead to sustainable development of that country. The importance of the reduction in GHG (mainly the carbon) emissions and its positive atmospheric impact is more advent due to the fact that the atmosphere is uniform and so, reduction in emissions occurring anywhere in the world would reduce the overall concentration of all the GHGs. How effectively we reduce these emissions in a cost effective or an efficient way is the real question. All developing countries enjoy an advantageous position inreducing such emissions in cost effective manner. In this regard the lower abatement costs of the GHGs (mainly of CO 2 ) in India as compared to its very marginal levels of the GHG emissions per capita offers India an opportunity benefit in terms of the CDM under the Kyoto Protocol.