Sustainable Consumption and Production (SCP) analytical paper

Dr. Utkarsh Ghate

Director, The Covenant Centre for Development (CCD)
Durg, Chhattisgarh, www.ccdgroup.org
03rd March 2014

Energy Intensity Reduction %: 1980-2010

80
60
40
20
0
-20

OECD-HIC India

China

Brazil

Russia

S. Africa

Submitted to
The Ministry of Environment & Forests (MoEF)
Government of India
New Delhi

Sustainable Consumption and Production (SCP) paper

for Ministry of Environment & Forest (MoEF) Draft for discussion
Dr. Utkarsh Ghate
03rd March 2014
EXECUTIVE SUMMARY

a) CONTEXTClimate change & biodiversity loss are hot topics of environmental debate
arising from the unsustainable consumption & production (SCP) patterns
that also create problems such as citizen health, future energy crunch &
agriculture productivity decline. Hence, promoting sustainable
consumption & production is now the focus of the global environmental
policy.
Increasing resource & energy efficiency are two key topics in SCP
discussion. Recent rapid world economic growth (250% in the last 25
years) has increased the material consumption and energy use by over
50%. The rising consumption is causing resource scarcity, environmental
problems like climate change & the local pollution, related health
disorders, biodiversity loss etc. Growing scarcity has caused 4 times price
rise of metals in the last decade. Similarly, food & energy prices have also
increased greatly & are increasingly unstable due to its depleting
resources. This has promoted the global SCP dialogue to ensure long term,
stable & equitable growth.
India may be the worlds 3rd largest economy by 2020 after China in 2030,
from its current 4th rank. This paper analyses Indias position vis a vis
global trends & suggests its possible position in the 2015 global dialogue
planned on the topic.
b) CONSUMPTIONIndias material consumption per capita is much lower than the industrial
& many developing countries at 4.6 ton/year/capita, about 60% of the
world average of 8 ton/ head/ year & 25% of OECD members average
value. Indias per capita consumption is amongst the lowest & its total
consumption is just 10% of the global consumption. Indias total
consumption would not exceed 15 % by 2030 as per the projected
economic growth rates (India- 6%, World- 3% annually). India has initiated

sustainable consumption efforts in its own & the global interest, that can
be strengthened.
c) SUSTAINABILITYIndia imports mainly crude oil & to some extent electronic goods,
machinery, pulses & oil seeds but not bulk commodities like steel, cement,
clothing etc. Its food production is growing at a healthy rate of 2.9% p.a.
exceeding the population growth rate (2% p.a.). Pesticide consumption is
also reduced 45% in the past 20 years, but can reduce further & fertilizer
inputs can be reduced by promoting organic farming techniques more
vigorously.
Similarly, steel, cement & other industries are also growing at healthy
rates of 7-11% p.a. including. Many environmental laws, policies & code of
good manufacturing or trade practices are established since 1990. The
share of resource recycling, saving & renewable is growing fast with 5% of
total energy share today, amongst top 5 countries. The resource scarcity
risk in the medium (2030) term includes energy, where imports, including
coal could rise beyond 70%. New resources such as gas hydrates are
being explored for self-sufficiency.
d) SCP INITIATIVESIndia has initiated several sectoral programs/ steps for making the
production process & consumption patterns sustainable by conserving the
energy & exploring new resources, rather than a single law or policy,
which gives it multi- faceted stability. Various initiatives include
(i)

(ii)
(iii)
(iv)
(v)

(vi)

Green stimulus - Integrated & no till farming, cottage

industries, (eco-friendly goods), various new & renewable
energy schemes including perform, achieve & trade (PAT)
Eco taxes - Coal tax, Pesticide tax, emission trading pilot
scheme in 3 states
Eco-labeling
- Organic certification, Eco-mark, Star-rating
(energy appliances)
Emission trading- pilot scheme initiated (in Gujrat,
Maharashtra & TN states)
Green public procurement - Public Procurement Bill 2012
with environment friendly clause, Renewable Purchase
Agreements (RPO), Sustainable public procurement of green
goods through Village industries commission
Consumer awareness - Eco-clubs, media campaign across 0.6
million villages

(vii)

Subsidy cuts- Price Deregulation of fossil fuels since 2011&

Direct Cash Rransfer (DTC- subsidy) targeted only for the poor
families is initiated.

e) EFFICIENCYIndian cement sector is amongst the most efficient globally with amongst
lowest resource & energy consumption, and is vigorously tapping
alternate fuels (fly ash) /raw materials (urban waste). Indias steel sector
has cut its energy & water consumption by over 30% since 1980 due to
improved technology & efficiency, but can improve further to match the
global standards. These 2 sectors lead the industrial material & energy
consumers.
Renewable energy has contributed 50% to the new capacity since a
decade, with plans to raise it to 100 GW by 2030, to contribute about 10
% of the energy basket. The national mission of energy efficiency aims at
10% saving by 2020. Key strategies for future may include (a) super
efficient appliances (b) standby power cutoff (c) smart grid & (d) green
buildings that could save about 30% of energy than today. Plans are made
to cut over half the energy losses in the generation, transmission &
distribution, that today amount up to 30% of the energy produced. Energy
Service Companies (ESCOs) are initiated for this purpose. India would
need external investment of about $ 10 billion/ year, in the power & steel
sector if it should double the share of renewable in the energy basket &
double the energy efficiency rate by 2030, as aimed in the draft
sustainable development goals by the high level panel.
f) CHALLENGES
Municipal waste recycling in India is improving, and some sectors such as
paper & plastic show high recycling rates, but metals & constructiondemolition waste recycling can improve greatly. Waste management is an
emerging green business with 1-2 companies each active in the major
metros & also in some secondary cities.
India has taken many steps for SCP but can strengthen the initiatives of
organic farming, waste recycling, waste to energy projects, decentralized
energy systems & green buildings certification. Besides promoting training
in green jobs in youthful India can boost exports of goods & services in an
ageing world by 2030, like the ICT sector proved in the recent past.
India can benefit by removing import duty on scrap, set up special waste
processing zones & waste to energy as well as recycling projects & end of
life recycling policy for metal goods & construction-demolition waste. India
can also start recycling label & suggest a SDG target for it.

g) GLOBAL ISSUESThe resource sustainability problem arise globally more due to the
following economic distortions primarily in the industrial countries, than
the growing consumption in the developing nations
(a) Subsidy Fuel &/or agriculture support in OECD nations exceeds
5% of GDP, much more than the others.
(b)Wastage - About 30% of food waste during consumption & also
energy or materials due to use & throw culture.
(c) Import inefficiency- Majority of the resources imported from
developing nations with low efficiency that reduces importers
resource efficiency too, (called embedding) but is often over
looked. As china is leading exporter to major nations, their
embodied energy intensity is more than their own domestic
consumption by 22% (Netherlands) to 46% (Japan). India has only
14% such increase due to low dependence on Chinese imports.
h) CONCLUSIONSDG (Sustainable Development Goals) can include the following SCP
targets
i)

Resource cap in conformity of with the planetary boundary

principle, recognize a resource cap of annually say 8 ton,
comprising or 1 ton fossil fuel & 1.5 ton metals & a waste cap
of 1 ton/ head/ year. This can make significant advancement
towards sustainable development in the developing world like
CDM triggered in the past decade, notwithstanding current dip
in its market.

ii)

SCP Indicators- Add to the national monitoring report

indicators (a) % of materials recycled & (c) % of renewable
energy as criteria in sustainability reporting to the UN CSD
framework & also add share of technology imported/ exported
at fair price to enhance international cooperation.

iii)

Cap & trade- A system may be started to (a) Tax/ levy penalty
on countries/agencies (states/ municipalities/ industries) that
exceed certain reasonable resource/energy cap & (b) trading
the surplus consumption by the countries to those below the
global limit to improve their efficiency through green
certificates needs to be initiated.

ACKNOWLEDGEMENTS
I thank Ms. Mrinal Mathur, Program Coordinator, UNDP office, New Delhi
for her constant feedback & assistance in preparing this report. Mr. Vivek
Wadekar, IRS & Director (SD), Ministry of Environment & Forests (MoEF),
Government of India guided the study well from the start & helped to
refine & focus in it in due course. Mr. Ajay Tyagi, IAS & Joint Secretary,
MoEF also provided crucial comments to finalize the study. Four subject
experts helped critically to develop the 4 themes of the study to enable its
completionAgriculture- Dr. Gopi Ghosh, Food & Agriculture Organization (FAO) India
office, New Delhi
Buildings- Ms Tejaswini Chitale, Ecovision consultancy, Pune
Energy- Mr Shantanu Dixit & Mr Ashok Srinivas, Prayas NGO, Pune
Waste- Dr. Rajesh Manerikar, Consultant, Pune.
Useful inputs were made by the following personsDr. J. R. Bhatt, Advisor, Ministry of Environment & Forests (MoEF), GoI, New
Delhi
Dr. Sanjeev Saxena, Dy. Director, Indian Agriculture Research Institute
(IARI), New Delhi
Mr. Sachin Joshi, Centre of Excellence (CEX) in Sustainable Development of
Confederation of Indian Industries (CII), New Delhi
Mr. Ranjan Gandhi of Society in Action Group (SAG),
Dr. Pulikesh Nydu, CCD program coordinator &
Prof. Hema Kulkarni, Govt. N. C. J. College, Dalli Rajhara.

INDEX

S.N
o.
1
2
3
4
5
6
7
8

Title
Introduction & Methodology
Consumption patterns- India
Production patterns- India
SCP policy & programsIndia
Global initiatives & issues
Conclusions &
recommendations
References
Glossary

Page
No.
1
10
16
24
30
40
44
49

Table List
S.No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23

Title
Balance stock of metals
Cost of Air pollution
SCP & climate change relationship
Indicator of consumption- production
Scope & relevance of the sectors
selected
Indias consumption size
Indias goods consumption & world

Emerging economies growth &

consumption S.No.
Particular

Page
No.
1
2
4
8
9
10
11

Figures List

12
Regional energy use and growth 19902008- Globe
14
1.
Commodity Price Index rice
Consumer durable penetration- India
14
2.
Ecological footprint of developed & other
Energy Intensity Reduction- India &
3.
Ongoing
countriesdecoupling
world
19
4.
Share of World GDP- 2030- India & other major
Clean energy policies in India
24
5.
Indias consumption pattern
Indias energy
intensity projection6.
Indias material consumption rate & other
2030
29
7.
Indias goods consumption rate & the world
Important SCP8.Action globally
31 & consumption
Recent economic growth
SCP initiative tools
acrossEco-bads
nations consumption32rates- India & world
9.
changes
Main importer
countries
& their
10.
Food
grain production trend- India
partners
35
11.
Fertilizer use rate- India
Embedded Energy
IntensityLeading
12.
Pesticide trend- India
nations
35
13.
Organic growers- lead countries
No. of threatened
species
37
14.
Energy Intensity Reduction- India & world
HDI relation to
15.unemployment,
Green dex map
suicide rates 16.
37
Indias energy intensity projection- 2030
Green Growth17.Risk-Benefits
for India
38
Fuel subsidy
% of GDP
India small role
consumption
18.in global Food
waste globally 40
SDG energy targets
&
Indias
19.
Subsidy & climate finance levels
suitability
41 of U.K.
20.
Embedded GHG emission
SDG waste targets
& Indias
suitability
21.
Top importer
nations 42
22.
Embedded Energy Intensity- 2010- Leading
23.
nations
Indias carbon intensity reduction on track

Page
No.
1
2
5
6
10
11
12
13
15
16
16
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17
19
28
29
32
33
35
35
36
36
43

ANNEXURES
1
2
3
4
5
6
7
8

Clean Development Mechanism

Greening the Indian Cement
Chotu-kul- the $69 mini-fridge
Eco-labeling & Green public
procurement in China
SDG proposal & Indian position
Indian SCP policies & other major
nations
Analysis & conclusions
Experts inputs

50
52
53
55
62
64
71
72