Environmental sustainability is fast becoming a strategic priority globally. In recent years, governments, corporations, individuals and non-profit organisations, in both the developed and emerging world have intensified their sustainability efforts, although for different reasons - from rising oil prices, concerns over depletion of fossil fuels and global warming, to the larger need to save our planet for future generations.
The Kyoto Protocol, an environmental treaty linked to the United Nations Framework Convention on Climate Change has evolved since it first came into effect in 2005. The protocol now offers flexible mechanisms such as Emissions Trading and Clean Development Mechanism (CDM) to help developed nations meet their greenhouse gas (GHG) emission reductions by purchasing carbon offsets from developing nations hosting sustainability projects. In fact, Asia currently accounts for over 75 per cent of the world's total carbon projects, and is expected to hold 80 per cent of carbon credits by 2012. India is already the largest producer of carbon credits in the world, with over 900 carbon credit projects already on, and around 180 more such projects likely to be added every year.
However, world opinion is currently divided on the efficacy of carbon offsets in addressing the larger issue of eco-sustainability. Critics cite that CDM encourages the developed world to purchase carbon offsets from emerging nations, while not doing enough domestically to mitigate GHG emissions. Further, emerging economies like India and China are being criticized by the developed world for their growing contribution to GHG emissions; this despite developed countries like the United States being among the top emitters of greenhouse gases.
Let us look at this matter from a different perspective. Instead of limiting the discussion to GHG emissions, what if we considered the sustainability issue from a holistic viewpoint and linked it to the number one priority of emerging nations-economic development?
Sustainability projects in the emerging world can be viewed as enablers of inclusive growth. By boosting employment, they can alleviate poverty while accelerating the fight against climate change and environmental degradation. But does this make economic sense? Is it cheaper for emerging nations to invest in eco-sustainability? Again, there are myriad views. But when it comes to costs of setting up green infrastructure, emerging nations definitely have the upper hand thanks to lower labour costs and less expensive domestic inputs.
Currently, most of the focus around green infrastructure is on renewable energy projects which are validated under CDM since they lower carbon intensity of the energy supply. Energy efficiency projects on the other hand lower energy utilization through cogeneration plants or the creation of energy efficient buildings, and are therefore eligible for validation. Both of these are essential, especially in the emerging world and I believe a lot can be done to generate clean energy, optimize existing energy utilization or both.
Leveraging the advancements in communication technologies, power generation companies could help improve the efficiency of power, allowing real-time monitoring, control, maintenance and protection of these power systems over a network, thus building intelligence into the grid. In addition, this intelligence could be built into the blueprint of the urban spaces of these nations. Since these would be green field deployments and not those retro-fitted onto legacy infrastructure, they are more likely to be cost efficient.
This is clearly an opportunity for emerging nations to move towards a low-carbon economy in the long term, and reap the resultant benefits. Communities of tomorrow can effortlessly capture the twin goals of sustained economic growth and environmental preservation, by developing policy and infrastructure, and investing capital and talent in eco-sustainability.