Why should we care about coral reefs disappearing?


They are such a beautiful, rich source of life and biodiversity.


How are they even related to me? I care more about the jobs and the economy.

Certainly, the “Pro” argument will not cut any ice with any person struggling with holding onto their jobs or finding a new job. Corals are remote, otherworldly, mysterious. You neither know or are likely to care about how your life and the corals are related.

But they are. And if you live near the coast, they are very closely connected.

And even if you live farther away, they are connected. The truth is, we get a lot more from coral reefs than we are aware of.

This makes understanding them, and the reasons behind their disappearance, relevant for us.

(this article earlier appeared in Firstpost)


Imagine you were the king of a medieval country. Your country is a fortified city and there are barbarians at the gate. What would you do first?

Yes, that’s right. Ensure that your wall is in good order.

Travel to today. The past weeks have seen us being bombarded either directly by floods, or by storm surges around the world.

And we have been chipping away at our “proverbial” walls. You see, the walls protecting our coastlines are the coral reefs and the mangroves. And they are being devastated.


Figure 1: The barrier reef seen from the sky; Picture by the author.

Fourteen years ago, I first swam in the Great Barrier Reef. It was an underground world of heart-stopping beauty. So beautiful, that some would have wanted to stay forever. Purple, orange, green, yellow, pink – the reef appeared a living tapestry spun from Nature high on weed. There is life – such life – fish darting in and out of the crevices, giant clams, fish in schools, turtles, sharks and then the corals themselves – fan shaped, fern shaped or branched. There is no comparison between sterilely seeing it on a TV screen and actually being in the waters. The cool embrace of the sea, the sound of one’s breath in one’s ears and having the fish in touching distance only to dart away as we extend our fingers.

Services provided by the corals

Such beauty makes you forget the astounding importance of the reefs, and trick you into thinking this is just Nature’s frothy exuberance. Coral reefs occupy about 0.2% of marine surface area but hold about a third of marine species. They are an ecosystem, where, as in a play, each character plays a role (sometimes more than one) on which the entire play is balanced. The corals provide support and a home for algae and nooks for fish to hide from predators and grow. The algae in turn produces food for the coral.  Herbivorous fish eat the algae and keep them from overwhelming the corals. Predators, like sharks and barracuda, keep the fish numbers in check. Everything is in a beautiful balance resulting in a garden of jewels under the sea.


Figure 2: The corals reefs – an underwater paradise with an unpleasant reminder – the bleached coral at the bottom left (Picture by the author)

Reefs provide so much for humanity.

Reefs protect the shorelines from erosion and storm surges. They are the outer ring beyond the mangrove defence.


Figure 3: A shark in the Great Barrier Reef is a sign of a healthy reef. However, that did not make us feel safer when actually in the water with the shark. (Picture by the author)

Animals and plants from the reef are a rich source of molecules to combat threats to our health. The National Ocean Service calls the reefs the medicine cabinet of the 21st century holding key molecules to treat Alzheimer’s and Cancer.

In an age where “jobs” are at risk, coral reefs provide jobs – the Great Barrier Reef in Australia contributes AUD$5.8 Billion in primarily tourism, creating over 68000 jobs in the process.

Globally, 275 million people live within 30 km of a reef, and depend on it for some part of their sustenance. In poorer countries, this means food and protein from the fish in the reefs, which cannot be supplanted from outside.

There is one more unsettling service the coral reefs provide.

Corals have been around for hundreds of millions of years, although the origins of the present reefs are more recent. They have also gone extinct a few times before. Interestingly or disturbingly, depending on your view, coral reef extinctions coincide with mass marine extinctions throughout the geological records. This makes the reefs an ideal canary in the global-warming coal mine, if you will. Long ago, coal mines did not have ventilation channels to allow toxic gases such as Carbon monoxide to escape. To ensure their safety, coal miners carried a canary in a cage with them into the tunnels. In the mines, the bird would sing, only stopping when it died as the gas concentration got too high for it, but not yet too toxic for the humans. It was an effective, if inhumane, early warning system.

Coral reefs can be thought of as our early warning system of life on the planet.

Chipping away at the wall

Last month I swam again amidst the reefs. The colours were on mute. Bleaching was easily visible. Even in the carefully “tourist-designated” scenic spots, algae-defeating-coral was visible. It was seeing “Through a glass, darkly”.


Figure 4: Coral that has been overwhelmed by algae (picture by the author)

In the millions of years of their existence, corals have never faced such a combined onslaught of stressors at such a pace as they do today.

Corals consist of a hard skeleton and a softer part, called the polyps. These polyps form symbiotic relationship with a single-celled creature called zooxanthellae. Like a good marriage, each brings something to the relationship, and each gets something essential from it. The corals provide the zooxanthellae with protection, a home and some nutrients. The zooxanthellae in return give the corals over 90% of the food they require, along with their lovely colouring. The problem begins when the temperatures rise. The zooxanthellae produce food by photosynthesis; several studies show that increased temperatures damage this process. The marriage is broken, and the zooxanthellae is chucked out by the coral. Only problem is, there is no one to make food. The coral is left bleached and weakened. The term “bleaching” refers to the loss of colour as the corals lose their symbiotic partners. If the bleaching is minor, the coral often recovers, finding other zooxanthellae partners. But in prolonged warming or mass bleaching, the coral dies. Recent and repeated warming has resulted in mass bleaching, where entire colonies of coral have died out. This is more serious, and harder to recover from.

The problem is compounded by the pace of warming. Corals are genetically very diverse – and in that diversity, there exist corals that can thrive in warmer temperatures. But the current warming is faster than anything the corals have had to cope with in the past.

Warming is not the only threat. Before the industrial revolution too place, the carbon cycle of the planet was thought to be in equilibrium. But today, humanity puts out about 33 billion tonnes of carbon dioxide each year into the atmosphere. A quarter of this is taken up by the oceans by converting the carbon dioxide into carbonic acid, which acidifies the waters. Corals need a material called argonite to form their bones. Typically, shallower water have plentiful quantities of argonite for corals to thrive. But as the ocean acidifies, argonite concentrations drop. This weakens the corals. In 40 years or so, concentrations may drop too low for the corals to form their skeletons.

Apart from these two serious global threats, there are the local hazards of overfishing, pollution (both sewage and runoff), storms and predators. Overfishing, especially of herbivorous fish, leaves the coral vulnerable to be overwhelmed by rising levels of microalgae. Pollution weakens all constituents of the ecosystem while sediments from sewage lowers the amount of sunlight reaching the corals – essentially starving them. Corals, weakened from the heat, acidification, sewage, pollution, become susceptible to disease and decay.

One of the most robust conclusions of climate science is that the coral reefs, unless something drastic changes, are doomed. The International Panel for climate change puts it thus: “Warming and acidification will lead to coral bleaching, mortality, and decreased constructional ability (high confidence), making coral reefs the most vulnerable marine ecosystem with little scope for adaptation.” That’s scientist-speak for “Sorry, you’re screwed”.

Next Steps

This is a tragedy.

But is there hope?

India has reefs mainly in the Andaman and Nicobar Islands, Lakshadweep, in the Gulf of Mannar and the Gulf of Kutch.

Dr E. Vivekanandan, Retired Scientist from the Central Marine Fisheries Research Institute says, “Hope is very remote”. Remote does not mean absent. One big victory has already been won: mining for coral has stopped. The corals of the Gulf of Mannar – one of the largest reef system in mainland India –  suffered from overfishing and coral mining. Until 2005, coral was mined first to build houses (we visited an old house in Tuticorin made from coral), and then to supply the appetites of the lime industry. Then two changes came about: First, in 2001, corals were added to the Schedule 1 of Wildlife Protection Act. Then, during the 2004 Tsunami, the villages shielded by the coral reefs did not have the property damage or the death toll of the unshielded villages. That is when the value of the coral reefs as effective bio shields was realised by their most effective guardians – the local villagers. This enabled the second change, the 2005 ban on mining coral, to have bite – because the villagers subscribed to it.

Another story of hope came from the Lakshadweep islands. During the monster 1998 El Nino, the reefs in these islands were badly bleached, as were reefs across the world. But the recovery in Lakshadweep was much faster than expected. What was going on? What was so special about these corals?

Nothing, it turned out. The specialness was that the fishermen of the islands mainly fished tuna farther away from the coast. The herbivorous fish in the reefs were not overfished here. These fish devoured the algae and allowed the corals to recoup.

As Dr Madhusudhan from the Nature Conservation Foundation says, “The threat [to the reefs] is from global causes, but resilience has to be built through local actions.”

Other ways of building resilience include ensuring sewage is not dumped into the reefs as in the Gulf of Mannar. The second is to expand the area under a Marine Protected Reserve. This will allow the fish populations to increase and spill over to non-protected zones in an acceptable way to fishermen.

But underlying all of this is to increase the perceived value of reefs. “We have to put a value to it.” says Dr Vivekanandan.

The Great Barrier Reef provides billions of dollars and thousands of jobs to the Australian Economy. It therefore has clout. Indian reefs are mutely suffering their many blows because they are perceived to have little value.

Eco-tourism, that can generate local jobs and engage public interest, is one promising idea. This must be very carefully done with a full engagement of the local population. Done wrong, it can damage the reef further. But done right, it can engage public interest and create a more sustainable stream of income for the locals, while helping build coral reef resilience.  The tiger reserves are packed attractions to Indian travellers. It’s time we stuck our head under the water.

The underground canary is beginning to stop her song. Can the World hear her silence?




Green = A divine rebirth


(Image courtesy: Flickr/Sandeep Achetan)

(This effort was also carried by the Hindu: http://www.thehindu.com/society/when-your-actions-speak-how-much-you-love-your-city-and-care-for-the-environment/article19587578.ece)

As a society, we equate size with quality. Bigger the better.

This belief has even come to our faith and our festivals.

Take the Ganesh Chaturthi.

In countless households across India, families welcome Ganesh into their homes in the form of a clay idol on the Chaturthi (4th day) of the Bhadra month in the Hindu calendar. The clay idol is adorned with a Erukku flower (Calotropis Gigantea) garland and usually with a grass garland as well. He is then offered modaks, or kolakattai – both sweet and savoury. These modaks are filled with jaggery and coconut for the sweet and with dal for the savoury.


(Image source: Flickr/Satish Krishnamurthy)

After a few days (it varies by location and community), he is taken to the nearest water body and immersed in the Visarjan festival. In earlier times, there was no waste – the offerings were eaten, the decorations fed to the livestock, and the Ganesh idol dissolved. Only the warm glow of memories of the festival remained.

In today’s size-obsessed society, Ganesh idols are large Plaster-of-Paris giants painted in lurid colours. Visarjan is a grand spectacle in many Indian cities. Processions pass through cities, grinding traffic to a halt.


(Image source: Flickr/Chetan Gole)

Finally, the Ganesh idol is worshipped and immersed in a water body – a pond, a lake, a river or a sea. Clay idols dissolve. Plaster of Paris idols do not. After all the pomp and grandeur, Ganesh is abandoned.



(Image courtesy: Flickr/Saurabh Chatterjee)

The thing to keep in mind is we can have our fun – the pandals, the private celebrations, the processions, the song, the food, the laughter – without harming the environment or sacrificing the idol’s dignity. We don’t have to give it up. We should not give it up. The secret is to treat our Ganesh in keeping with our ethos. As Hindus, we believe in the circular nature of life. Our Ganesh should reflect that.

This thinking, gave rise to the seed Ganesh. Our seed Ganesh is made of pure clay, and filled with a ball containing our own compost embedded with seeds – tomato, tulsi, neem – and fashioned into a charming Ganesh. Many establishments across different cities have begun to popularise this concept.


(Photos courtesy: Sundaram Climate Institute)

You can welcome him home and worship him. Then, when Visarjan comes about, you take him into your garden or balcony garden and pour water over him until he dissolves.


(Photo courtesy: Sundaram Climate Institute)


(Image courtesy: Sundaram Climate Institute; we tested out our first seed Ganesh earlier, and got our first sprouts a few days later)

A true tribute to the circular nature of life and far more dignified farewell for our Ganesh. The icing on the cake is that our already over-stressed water bodies are not further polluted.




Au Revoir, M’sieur Trump?

(This was published in Firstpost on Jun 01, 2017)

“The worst thing you can possibly do in a deal is seem desperate to make it. That makes the other guy smell blood, and then you’re dead.”

Good advice for the rest of the world in waiting for America’s decision on the Paris accord. Especially since it comes from Trump himself in his book “The Art of the Deal”.

And the current situation is a big deal.

Only that the world’s largest cumulative greenhouse gas emitter is deciding, at its leisure, whether to stay in a relatively mild agreement on climate change. For all the drama in the headlines, the Paris Accord, even its current state, lacks bite. By staying and not achieving its self-determined targets, the US loses little. It may get a few cold stares, and some diplomatic quips, but there is nothing legally to get the US to tighten up on its emissions.

Not yet, anyway.

So why all the fuss? Why the urgency?

Representational image. Reuters

To answer this question, we need to grapple with something called the carbon budget. First, let us start with the word “budget” – it tells you how much you can spend while staying within certain goals. For instance, a household budget is the amount a household can spend while sticking to certain saving goals and achieving a desired lifestyle. A calorie budget determines how much we can eat while sticking to a certain activity level and a desired weight.  Similarly, a global carbon budget tells humanity how much greenhouse gas emissions we can produce while having a reasonable chance of staying within a safe temperature increase.  This safe increase has been determined as a 2°C warming from pre-industrial temperatures.

What happens when we warm beyond 2°C?

Let us take the best scientific understanding of what will happen, and convert it into plain English.

As it warms, rain will fall more intensely. Wetter regions will get wetter, but will now get their rainfall on fewer days. Resulting in? Storms and Floods. Events such as the Chennai Floods will become far more commonplace.

On the other side of the coin, drier regions such as Rajasthan, Tamil Nadu and Gujarat will get a lot drier. Droughts such as what South India is currently experiencing will become more common. Punjab that is using its groundwater with impunity will have to reconsider its agricultural ways wholesale.

Temperatures will get warmer – decimating yields of many crops (unless we adapt, but that’s another story). Certain regions of the world will become uninhabitable, resulting in millions of climate refugees. Unique regions of the world, such as the coral reefs, will be lost forever. It’s very hard to describe the other-worldly beauty of the coral reefs unless you’ve actually swum amidst them – the colours, the sheer diversity, the hive and hum of activity. But it’s very very likely that the reefs are doomed even with marginally more warming than today, let alone a 2°C warming. Human health will suffer especially in the hotter and poorer regions of the world. Death due to heatstroke will increase, and mosquito-borne diseases and mental illness will begin to exert a heavier toll.

Unpleasant, to say the least, and worth avoiding. This is where the budget becomes important. OK then, what’s the budget?

Conservative science (based on research by the Intergovernmental Panel on Climate Change) estimates that humanity can emit up to 762 billion tonnes of Carbon dioxide emissions from 2017 and still have a 66 percent chance of staying within a 2°C warming from pre-industrial times. Given our current emissions rate, that gives us just under 20 years before we blow through this budget.

But this budget is a severe underestimate because it does not consider the warming caused by greenhouse gases other than CO2. A paper by Rogelj et al in the prestigious journal Nature Climate Change, suggests that the budget could fall to as low as 510 billion tonnes from today. That puts the window to get our emissions to zero a just a little over ten years from today.


Of course, once a budget is set comes the next challenge. How do we divide it?

Anyone who has worked in a departmental context, knows of the aggressive jockeying that takes place while allocating budgets.

Imaging this happening on a planetary scale, with a Trump-led-America in the mix.

There are several approaches that the world could take in dividing the carbon budget. One is in terms of historical responsibility. Keep in mind Carbon dioxide tends to stick around in the atmosphere for a long time -a significant fraction stays around for centuries. We can argue if a country has contributed to “more than its share” historically, it should pay or contribute less going forward. And historically, the US has eaten up far more than its fair share of the historical carbon budget – its share of cumulative carbon dioxide emissions exceeds 25%. India’s share, in contrast, is a tiny 2 percent of cumulative carbon emissions till date. To round out this discussion, the EU-28 has a 23 percent share and China has a 11 percent share.

And yet Trump says “It’s not a fair situation because they are paying virtually nothing and we are paying massive amounts of money”. Hmm…not sure where he is coming from.

Countries like India — developing and with large populations — will argue that the remaining budget should be split on a per capita basis adjusted for past emissions. Others may say, “Let us extrapolate existing contributions with richer countries paying for poorer countries to reduce their emissions”. Others might just say “Get lost”— in polite or less polite terms.

The Paris agreement has side-stepped this point completely by getting countries to make their own commitments. There was a lot of “Mine is better than yours” diplomatic heckling that made the commitments more ambitious than they would have otherwise been. Note that this approach works in a context where the big emitters believe in the process and want to make it work. Heckling Trump, I believe, will not get him to change tack and opt for higher emission cuts in the US.

Where does this leave the world, and more importantly, how should the world react?

To answer this, let us ask what does the world get if America stays in the Paris accord.

There is the symbolic victory. Even Trump believes in climate change. But this symbolic victory would exact a heavy price. The US, under President Trump’s leadership, could get the world to dilute many of the provisions in the Paris accord, including perhaps the pledge and review process and the Green Climate Fund.

While, if the US were to leave, or daring thought – be chucked out! – then the game changes. The rules of climate engagement due to be finalised in 2018 could be made much stronger – this would be good for the planet. Also putting some sort of carbon tax on US imports or services provided by US companies in compliant countries would serve to make the deal sweeter for the rest of the world. Some of these funds could even support the Green Climate Fund.

In climatically-inappropriate F1 parlance it would be “Game on!”

Perhaps the oil companies realise this. One of the delicious ironies of the last few months is ‘Big Oil’s’ urging of Trump to stay in the Paris Accord. The Paris accord is about reducing humanity’s greenhouse gas emissions, which are driven in a large part by burning oil.

climate conversations logo for mridula ramesh

Shell was one of the signatories of a letter addressed to Trump which begins by saying: “We write to express our support for continued participation by the United States in the Paris climate change agreement.” Shell’s chief later stated, “the US would weaken its own hand by basically uninviting itself from a number of [negotiating] tables,”. 

The question really is what does the world lose if a climate-sceptical American left the Paris accord.

On one hand, American emissions could rise. This could happen anyway, even if America were to remain in the Paris accord. The other would be geopolitical storm that would be unleashed if America is asked to leave. The storm would cause damage, but perhaps a stronger agreement could emerge.

Coming back to Trump.

In this deal, arguable the world’s most serious, what would his words of advice be?

But my experience is that if you’re fighting for something you believe in — even if it means alienating some people along the way — things usually work out for the best in the end.”

Lessons from a River Reborn.

Summer is a supercharged time in the South. For one, its hot. The one degree of global warming is palpable in May, where the temperature often skips above 40°C. For another, it is dry. The past year has been one of the driest in the past hundred and forty years.

In Madurai, we have our biggest festival of the year where a local deity, Alagar, enters the river Vaigai, with hundreds of thousands of devotees swaying to witness this grand show.

This year there was a small catch: there was no water in the river. There is a river bed where buffalos graze and small streams of pure sewage flow, but the river per se died a while ago.


There have been many attempts to rejuvenate this river. Thus far, they have all failed.

Why? The answer is in a word – equilibrium and its better-known partner – inertia. The classic definition of a stable equilibrium is “a state in which a body (or state or country) tends to return to its original position after being disturbed”.

It helps if we have an example.

The district of Alwar in Rajasthan is water-stressed, receiving less than 650 mm of rainfall in a year, most of which falls during the Southwest monsoon. The region is also amongst the hottest in India: Alwar held the “Hottest temperature recorded in India” for decades until it was eclipsed by another town in Rajasthan in 2016.  As is common in such places, much of the rain either runs off or evaporates, leaving the land parched and dry for most of the year. About thirty years ago, in the 1980s, the situation was so bad, that it appeared as though the region was going to become one of India’s first “climate victims”, falling prey to the heat and drought.

But the situation was not always so. Alwar had a rich history of water conservation embodied in its “Johads” – crescent-shaped earthen dams that checked the flow of water and allowed the rainwater to percolate into the soil below and replenish underground aquifers.. In a dry area, the sensible thing is to store water underground, safe from the grasping heat of the sun.

The region also had dense forests: the trees and Johads worked together to trap and store the precious rainwater. Johads tend to be big – the smallest being half an acre in size. As such, they need a village to build and maintain them. In older times, the system was self-sustaining: The king would pay to build and maintain the Johad and enforced rules on not encroaching on forest lands. In turn, the villagers would pay him a share of their crops. The forests provided hunting opportunities for the king while the king protected the forest. The depredations the villagers made on the forest were of the sustainable sort.

Alwar existed in a stable equilibrium, where even if there was a drought, the Johad’s and the forests made it possible for water to be stored underground. Because of strong communal interdependencies, all villagers stuck to sensible crops for the region, and the king was an effective disciplinarian who maintained the Johads. The community, the Forests, the Johads, the choice of crops, the king all worked together and reinforced one another. Equilibriums are maintained by such reinforcing activities that fortify status quo.

But then came the disturbance.

During the Second World War, the British pressurised India to provide timber for their war efforts. The deforestation pressures continued to mount after Independence when a newly created nation wanted wood for its railways and for charcoal.

The first effects of this deforestation soon showed up.  Without the stabilising influence of the trees, the rain carried away the top soil and dumped it on the Johads, silting them up. Without the well-functioning Johads, water levels began to fall. There was no King to pay for maintenance. Moreover, technology reared its disruptive head. In the fifties, the tube well came to Alwar. Instead of the laborious work of communally maintaining the Johad and strict rules on water use, now water was available at the flip of a tap. Here was a machine that could deliver water at a flip of a switch, why worry about desilting Johads? But soon, the water began to recede deeper and deeper, and the machines took more and more power to deliver too little water, until finally, well after well began to run dry.

The earlier equilibrium was broken. The new one left Alwar shattered.

The young men of the village began to emigrate in search for work while the women had to travel farther and farther away to find water for their homes. The very real question became: would Alwar become the first climate victim of India?

Alwar 1985

Figure 1: Alwar in 1985; Picture Courtesy Tarun Bharat Sangh

But then there was another disturbance – this time of the positive kind.

In this bleak scene, a group of idealistic young men came to Alwar. Like many angry young men, they were fired by a desire to “do something to help”. Leading them was 28-year-old Rajendra Singh, a qualified Ayurvedic physician. But strangely enough, he found the villagers to be unresponsive. Indeed, some villagers thought the young men were up to no good at all and wanted them to leave. Singh was disappointed – after all, they had come to the village to help! Just as he was about the give up, Mangu Ram Patel, an elder of Gopalpura told him bluntly:” Talk less, dig tanks and build Johads to get results”. Another villager, Nathi Bhalai was even more blunt: “You fool! You have not understood what is needed. You need to build talabs[1] so that the water does not run off”. Thus, it came to be that Rajendra Singh and Nathi Bhalai took up spades and began to create a Johad in Gopalpura village in 1985. Others watched them, first in curiosity, then to heckle and finally to help. After several months, the Johad was completed and the men sat down and waited for the monsoon.

The rain gods did not disappoint.

By the end of the monsoon, the pond behind the Johad was full.

Surprisingly, so was a neighbourhood well that was not connected to the pond.

The members of Tarun Bharat Sangh, the organization Singh began, held a Pani Yatra (or a march for water) through the nearby village. The villagers of Bhaonta-Koyala were envious: Their wells lay dry and their women had to walk a long way to fetch water, while nearby Gopalpura had water in its wells year-round[i].

Envy is a powerful tool. What was the secret in Gopalpura?

TBS offered to share the secret if the villagers undertook the labour. There was no other alternative: there was no groundwater. Thus, the communal interdependency was built again. In village after village, Johad after Johad was repaired and renewed. Unsurprisingly, water levels went up. Soon, the villagers began to reforest the land around the Johads. They had tasted the wonders of the Johad, and knew that by planting forests, the Johads would not silt up so frequently, nor would the rain evaporate so quickly. The Johads and the forests grew side by side as in the old days. The equilibrium had begun to shift again.

Then, almost a decade after the first Johad has been renewed, a miracle occurred. The Arvari was a seasonal stream in the region that flowed briefly for a few weeks in the monsoon. In dry and hot areas, river replenishment happens through underground water flows. As the Johads replenished the ground water in the upper catchment areas of the river and the forests prevented runoff and evaporation, the river turned perennial and was newly reborn. There was now a new stable equilibrium.

Alwar 2012

Figure 2: Alwar in 2012; Picture courtesy Tarun Bharat Sangh

Many men returned to their villages to farm, now that there was water available. Women and girls were spared the long trek to gather water, and more girls began to go to school. The water level increased and the increased soil moisture allowed farmers of the region to go for more croppings in a year.

But then, another disturbance occurred.

A perennial river meant fish. The state government gave the fishing rights of the reborn river to a private entity. The villagers were aghast. Was this a beginning of a new kind of end? To manage the common fruits of their success, the villagers created the “Arvari Sansad” or a Parliament for the river Arvari in 1999. With representatives from 72 villages in it, the Arvari Sansad frames the rules of engaging with this common resource. For a water-conservationist, it reads like a dream. There are provisions for the type of crops allowed, grazing rights, and borewell rights (they are not allowed). Industrial units are also not allowed. The focus of the rules is to maintain the equilibrium of a community-managed, sustainable agro-based economy.

A key determinant of success was the choice of who sat on the parliament. Rajendra Singh told me that those who contributed to the river’s rejuvenation directly sat on the parliament. Communal surface water management worked here because all contributed to the creation and maintenance of the water resource – they had directly expended resources and therefore had “skin in the game”.

Second, because the people in the area still remembered what happened when groundwater was abused, they understood what the disturbance of the equilibrium would mean. Lastly, any flouting of the rules, would evoke communal punishment. For instance, if anyone tried to drill a borewell, their neighbours would alert the villager leadership, and a group would be sent to “block the borewell.”

Success has not been easy to come by. The “parliament” has no legal standing and rules solely by moral authority. But because of communal interdependency, there is extra bite to the authority. There is one more contributor to the success of the Johad: the water from the borewells in Alwar is often contaminated with Fluorides or other salts, making the water from the Johad the preferred source.

“Come see” says Rajendra Singh “You cannot see a single field with sugarcane, paddy or any water-intensive crop”. And they are thinking ahead. The next generation will not remember a time when the borewells ran dry. They do not have skin in the game as they did not rebuild and create hundreds of Johads, nor did they nurture the forests. So, the members of Tarun Bhagat Sangh spend their time educating the children and trying to imbue them with a link to the Johad, the forest and the community. This is a critical step in maintaining the equilibrium.

Alwar Farmer

Figure 3: A farmer in Alwar, Picture courtesy Tarun Bharat Sangh

Coming back to South India and its drought.

Let us look at Madurai.

Most people do not have a clue as to how much water they consume for one very simple reason: there are very few working meters here. As a result, a large chunk of water is lost to leaks (A conservative estimate in a World Bank study puts this number for Indian cities at 30-40%). Large sections of the city do not pay for the water – as a result the equilibrium is tilted towards water profligacy. There is the water mafia as well – the tanker operators who sell water at high prices to the masses who do not have access. Almost every person I have met in the past few months has been buying water in Madurai.

Farmers grow paddy (a water-loving crop), drawing water with pumps when they can, when the power comes, and if the water is there. Electricity for farming is free, which does not support sustainable water use in farming. And this is important because, most estimates have agriculture using between 80-90% of water used. Thanks to an unpredictable power supply, Farmers have little control over when and how long the pumps will run, and because of the free electricity, they have little interest in controlling its usage. After all, the water stores lie deep underground and they have lasted until now.

And the climate is playing truant. A quick look at 100-year rainfall data (See Figure: ) suggests that the worst is yet to come. When we look at annual rainfall data culled from IMD data and data from the Tamil Nadu Agricultural university, we see that annual rainfall began to fall about 35 years ago and there is no hint of the stemming of this tide.

Madurai Rainfall 100 years

Figure 4: 100-year rainfall data of Madurai; Picture Courtesy Sundaram Climate Institute

So, we have a crisis on our hands. And crises tend to be great opportunities to change the status quo because the population tends to be desperate and willing to change. This is rare. And such opportunities should not be wasted.

But what have we got?

Three obvious measures to tilt the equilibrium towards one that favours sustainable water use include universal metering, a universal (but differentiated) water price (including priced electricity for farming) and communal ownership of groundwater. Each of these would encourage sustainable use of water. Farmers and low income users could pay a lower price and with the Direct Benefit Transfer scheme gaining traction, the government can ensure a basic refund goes to the neediest families, so that they are not out-of-pocket when using water carefully.

Rajendra Singh is not a capitalist – far from it. Even he agrees “Water needs a price. Thirty years ago, I thought “Water is Nature’s gift to my life. I don’t pay a price.” After 30 years [now I say], water need a price. We are using water in a different lifestyle. Water needs some treatment. Water needs management. Water needs distribution. Without a water price our future is not safe.”

Many experts talk about increasing the penetration of drip irrigation in agriculture. Even in states like Tamil Nadu, where subsidies make the drips almost free for small farmers, the take-up is not spectacular. Why? Drips need maintenance. Rodents bite the tubes, there could be some debris that blocks the drip, meaning the farmer will have to regularly spend time and effort to check, clean and fix the drips. Why would the farmer incur a cost to save a commodity that is free?

Headlines and experts bemoan the existence of the water mafia. Why is there no water mafia in Singapore? Because Singapore charges a high price for its water and has a pay-and-perform culture at its utilities. Everyone pays a price for their water that is transparent and fair. This allows the Singapore Water Utility to invest in top-notch facilities including a state-of-the-art wastewater recycling plant and a visitor centre to teach children (and adults) the importance of water. All of this ensure that everyone in Singapore always gets clean water at the turn of a tap. There is no room for the Mafia.

But who will invest in India’s water utilities when the finances look so poor – with little prospect of them improving? Improving water supply and defeating the water mafia means universal metering, a universal water price and a culture that rewards performance at utilities. Only then will leaks be fixed, will sources be strengthened and problems solved.

Thus far, most relief measures have been either compensation to farmers or sinking more borewells to ensure cities get their water. These are short term measures. They will not shift the equilibrium – they will only reinforce status quo.

Let us not waste this crisis. Let us use it to take our first steps into a new equilibrium.

[1] Reservoir

India. Water. Do we have a problem? Yes. Can we something? Yes.

Canon Rebel 200Ground water levels have been falling continuously in many parts of the country.

The first question to ask is are we taking water from the groundwater (aquifer) in a safe way — in a way that allows it to recharge. In many parts of the country, the answer is “No”.

Groundwater India 2016

The second question is the groundwater levels themselves: http://www.cgwb.gov.in/Ground-Wa…

In many places, groundwater levels are falling — especially in places like Rajasthan and Tamil Nadu, where alternate sources of water are scarce.

To add to this problem, in many places, rainfall patterns are changing, most probably because of the warming climate. Shown below is the hundred year rainfall of Madurai. Annual rain received started falling about 30 years ago, and has kept falling since then.

Madurai Rainfall 100 years

OK. So we have a big problem.

Is there a solution?


Countries with much less rain than us, export water — namely, Israel.

So there is a solution available today.

How do they do it?

They treat their sewage to such an extent, that the quality becomes almost good as fresh water. They then use it to irrigate their crops through drip irrigation.

Many places in India have used traditional methods such as check dams, farm ponds and bunds to conserve their rainwater.

There are methods to prevent evaporation from ponds and lakes.

But do you see a problem in adopting this to the Indian context?

Collecting sewage, treating sewage, using pipes to take it to agricultural regions, using drips all cost money. Building check dams, farm ponds and bunds take labour and maintenance — it costs money. Today, farmers get the power to run their pumps for free. Ground water is free.

Cities routinely lose more than half their municipal water to leaks.

In my house, until we installed meters on each tap, we found we were hugely inefficient in our water. Ditto for our farm. We reduced pressure, arrested leaks and reduced the number of hours we watered our plants. This has helped bring down our water use by 40–80%.

Again, meters, people to monitor the meters and take action all cost money.

In cities, there is an additional problem – the water tanker mafia. Many of us pay substantial prices – about Rs. 1-1.5 per litre for “drinking water” and less for more substandard water. This lobby prevents progress because they rake in huge sums in supply. They exist because municipal supply is so bad. Municipal supply is bad because we pay too little for it and because believe we cannot question its functioning.

Both of these have to change, if we need to make progress.

We need an universal price for water. Universal in that all users must be charged. But all users need not be charged the same price. Until and unless we charge a price for water — all water and for all users — there is no solution for this.

Action on Climate Change – Net-Works

Fishing net

Problem: Discarded fishing nets are a major source of pollution of the reefs

Solution: Community members are paid to collect fishing nets which are then recycled into carpet tiles and are a sustainable solution from an economic perspective


A woman’s story

What happens when a warming climate targets women

(Image source: The Hindu)

Woman’s day is coming up. An annual circus about all things woman.

Pink. Pretty. Predictable.

In this century, I find it funny. A little anachronistic even. Woman’s day. What about every other day? Is it also not a woman’s day?

Apparently not.

Decades ago, while working with Asha Cornell, I had an opportunity to visit a town called Usilampatti, near Madurai. There was a group working on female infanticide – a practise where baby girls are killed by their families shortly after birth – and they had organized a meeting with a group of villagers. It was an emotional meeting. Many were quiet. One mother of three boys spoke of how she longed for a daughter. Then one woman stood up and said “I have killed my daughter, give me money.” She believed that we were there to encourage this practise and were making handouts to anyone who practised it. When asked why she felt she should be rewarded for killing her own daughter she replied “My daughter takes money to feed and clothe. Then she studies. Then I must marry her off. The boy’s family, even if the boy doesn’t work and hasn’t studied, will demand a lot of dowry. I can’t meet it. My daughter will only be tortured. Instead of the whole family suffering all the way, simpler and less painful to kill her now.”

Female vulnerability begins at birth.

While, on average, women live longer than men, less than half of India’s population is female –suggesting some systematic way of eliminating females from the population. There are just 909 girls born in India for every 1000 boys. Worse still, in developed states like Tamil Nadu, the sex ratio is falling. In 2013, there were only 927 girls born for every 1000 boys down from 955 a decade prior[i].

The vulnerability continues as the baby girls grows. She is often less educated: with attendance in school falling steeply as she enters puberty, especially in rural India. In a world where opportunity increasingly beckons only the educated, she has already been placed on the “slower” track[ii]. With the lower education, the rural woman begins her working life with many avenues closed to her.

This vulnerability is compounded when she (and if she) enters the workforce.

For women who do work outside their homes, data from the World Bank suggest wages for women performing casual labour are 20% lower than those received for men and 20% lower for the same task.

An overwhelming portion of urban women don’t work as they enter their marriage and childbearing years. This is a tragedy and an enigma. This is a subject for several books in itself. But a very brief and therefore necessarily incomplete explanation would include cultural factors such as women shouldn’t work and child care. In our surveys, we found the cultural attitude of “Let’s not work” to be pervasive amongst a very large group of young urban women. Many view their jobs as a stop gap between the end of college and the time their parents can match them with a suitable boy.

Companies adapt their recruitment, training and promotion strategies accordingly.

This reticence to work amongst urban women contributes to India having one of the lowest workforce participation rates in the world. Lower than even Chad, Oman, Uganda and Kuwait!


Experts suggest that perhaps this low working rate partially explains the falling sex ratio. Heartless as it may sound, questions are asked on why should parents spend so much on educating and bringing up a girl child, when she contributes very little to the family kitty? Whether we like this question or not, we cannot ignore it.

Almost twice the proportion of rural women work, often as marginal agricultural workers[iii].

Climate Risks

A warming climate poses many risks to this vulnerable group.

The first kind of risk is the risk to employment. Almost three quarters of the working women in India work in agriculture, often as landless labourers. This group has few alternates for work: either in the form of alternate rural employment (textiles being the notable exception) or the ability to migrate. A warming climate is projected to decimate agricultural yields – this means there will be less “surplus” to pay for labour. Automation will reduce need for such labour. What this large group of working women will do in the coming decades is an important question of our times.

The second risk pertains to the roles that women perform: child and household care. As we saw earlier, both the incidence of mosquito-borne diseases and the incidence of health problems related to floods are set to rise as the climate warms. With children being a vulnerable group, child carers, who are overwhelmingly women, are set for bad time. They will have less time to work or to relax thus reducing their well-being. As the incidence of drought increases, more and more girls must walk further each day to collect water – stealing time that could have been put to school or leisure. Several studies show that as drought increases and the available nutrition available for a family falls, women often forego their share in such scenarios so that their families benefit, worsening their health in the process.

One contributor to global warming on a local scale is the black smoke that emanates from cook stoves fuelled by solid fuels like wood or dung. The black smoke is said to cause warming at a local scale. The tiny particles in the smoke enter our lungs and wreak havoc. Across India, millions of households use such stoves contributing to over a million deaths a year. The bulk of this burden is borne by women who cooks and the babies and children with them.

The third risk is the increase of violence against women. Most incidences of violence go unreported or under-reported. But a death, especially a dowry death, is much harder to hide.

A study by Sekhri and Storeygard[iv] looks at data from 500+ districts in India over the past decade. The authors found that whenever rains fall by a standard deviation, or 240mm in a season, dowry deaths in that district rise by 8%. The authors explain that the groom’s family sees the killing of the wife as a form of “income smoothing”. Farm incomes fall during droughts. Killing a woman and marrying a fresh wife means there is new income for the family. Horrifying as that sounds, it is a plausible explanation for the data.

Studies show that domestic violence reports in the US increase by 7% for every degree C rise in temperature. There is already a cultural tolerance for domestic violence in India. Rising temperatures, could simply exacerbate this risk. With violence against women already making regular headlines, this is a risk we cannot afford to let rise.

Can we do anything?

Providing alternate employment for our rural women is a big action, one we will look at in a later chapter.  Female education remains one metric that characterised egalitarian societies. It has so many positive benefits – lower birth rates, better maternal and childhood prospects, better childhood nutrition. Not to mention the boost the economy would get from having an increased participation of half its members.

There are many “push” solutions today – government schemes that try to educate the girl child. Now we need to add a few pull schemes. If women joined (and remained) in the workforce in larger numbers, the economic argument would work for them to study more.

Urban women who view their job as a stop gap between college and marriage should keep this in mind. As should companies who employ women in creating an environment – childcare provision and allowing for flexible hours – that keeps women at work.

If we want to move forward as a country, we cannot afford to leave half our population behind.


[i] Office of the Registrar General and Census Commissioner, India. (ON647)

[ii] Ministry of Statistics and Program Implementation, Government of India

[iii] Census 2011; Ministry of Statistics and Program Implementation, Government of India

[iv] Sekhri, S. and Storeygard, A., 2014. Dowry deaths: Response to weather variability in India. Journal of development economics111, pp.212-223.

The fall of crude and the death of king coal

Something very unusual took place in 2014, that changed the course of the global economy. In June 2014, global oil prices began to fall. Brent Oil prices almost reached $115 in late June, and then began to fall precipitously. In early October 2014, with Brent prices about 20% lower at $90 per barrel, the PIRA Energy Group held a seminar in New York City that was attended by a Saudi delegation led by Nasser al-Dossary. At that time, when asked if the Saudis were going to cut supplies to protect prices, Dossary was reported to have commented ,
“What makes you think we’re going to cut?”.
That statement incited international headlines. Saudi did not cut its production and oil prices continued to crash – falling two thirds to under $30 per barrel in January 2016 before rising again.
Why did Saudi change its policy, established over decades, to stem the fall in crude prices?
There are several potential reasons for this. Let us examine each in detail.
Moving away from Fossil Fuels
As the world wakes up to the dangers of climate change, a common point of agreement is that we need to reduce our use of fossil fuels.
On the face of this, this looks like an impossible ask. The world gets 80% of its energy from fossil fuels, the cost of energy produced from fossil fuels is cheaper than from alternate sources and the infrastructure: to produce and use fossil fuels is very long lived: some of it lasting beyond 50 years.
While we will explore the concept of levelised costs of different sources of electricity in the chapter on Solar Power, Figure 1 presents the comparison now .

Levelised Cost of Electricity

Figure 1: Levelised Cost of Electricity from OECD countries and China, 2015

2013 Share of Primary Energy Supply b Source

Figure 2: Share of Total Primary Energy Supply by source
However, if we want to restrict our planet’s warming within the 2C limit, much of the fossil fuels available under the ground today will have to stay under the ground. Because 80% of greenhouse gas emissions come from burning fossil fuels . Just how much will have to be stranded?
An authoritative study published in the highly respected Nature Journal said that globally, a third of oil reserves, half of gas reserves and over 80 per cent of current coal reserves should remain unused from 2010 to 2050 in order to stay within a 2°C warming limit .
This struck the first blow against fossil fuel producers.
But this might have remained just impotent cries from scientists had it not been for one more thing: the updated burning embers chart in the IPCC report showed all countries would suffer if we exceeded the 2C limit.
So, the road to Paris was substantially different from the past.
Countries joined the bandwagon on the way to the Paris Climate Summit, with many pledging lowering of either their overall emissions and/or specifically lowering the fossil fuel intensity of their energy use.

India has put forward the targets to lower the emissions intensity of its GDP by a third by 2030 (below 2005 levels) and to increase the share of non-fossil based power generation capacity to 40% of installed electric power capacity by 2030. While the latter is negative for coal, the former is negative for oil as well, given India’s stated aim of enabling public transport with a lower crude oil footprint. Separately, India has taken concrete reforms to reduce her dependence on fossil fuels: by increasing excise duty on petrol and diesel, quadrupling the coal cess from Rs.50 per tonne to Rs.200 per tonne and Prime Minister Modi’s plan to increase the production of solar energy to 100 GW by 2022 .
The USA has committed to a reduction of 26-28% greenhouse gas emissions by 2025. Given that its transportation sector accounts for over quarter of its emissions and relies on almost entirely on oil, this is crude-negative.
“No challenge – no challenge – poses a greater threat to future generations than climate change…We believed we could reduce our dependence on foreign oil and protect our planet… Every three weeks, we bring online as much solar power as we did in all of 2008. And thanks to lower gas prices and higher fuel standards, the typical family this year should save $750 at the pump.” Said Obama in his sixth State of the Union address in January 2015.
China, for its part, committed to lower the carbon intensity of GDP by 60% to 65% below 2005 levels by 2030, increase the share of non-fossil energy carriers of the total primary energy supply to around 20% by that time .
Countries were beginning to reduce their use of fossil fuels – they were expressing themselves through announcements and regulatory action.
Shift in Investment
Governments were joined by other influential decision makers. What began in 2011 with college students protesting to demand their institutions to shift away from fossil fuel investments has now grown to include sovereign wealth funds, pension funds, family offices and religious institutions. All told, by September 2015, over 400 institutions representing $2.6 trillion in assets, pledged to reduce or exit from their fossil fuel institutions .
Ironically, the Rockefeller family fund, whose family fortunes derived from oil, declared its intention to exit any fossil fuel-based asset “as quickly as possible”. The announcement that accompanied this decision was quite blunt:
“While the global community works to eliminate the use of fossil fuels, it makes little sense—financially or ethically—to continue holding investments in these companies.”
“We would be remiss if we failed to focus on what we believe to be the morally reprehensible conduct on the part of ExxonMobil. Evidence appears to suggest that the company worked since the 1980s to confuse the public about climate change’s march, while simultaneously spending millions to fortify its own infrastructure against climate change’s destructive consequences”
Populist movements and shift in Investment
In June 2015, Norway’s parliament formally endorsed its $900 billion fund to sell off its coal assets . In October 2015, the Financial Times reported Yngve Slyngstad, chief executive of the oil fund, saying “If you run a sovereign wealth fund in a democracy and there are limits to what the population wants to make money on. That they [politicians] first removed tobacco and certain types of weapons and now have removed coal is of course a reflection of the Norwegian population’s sentiments and instincts with regard to where we want to make money for our grandchildren.”
In April 2016, Norway’s oil fund excluded 52 companies for being too reliant on coal. The war on fossil fuel divestment had been well and truly joined.
The Church entered the fray with Pope Francis’ encyclical.

“We know that technology based on the use of highly polluting fossil fuels – especially coal, but also oil and, to a lesser degree, gas – needs to be progressively replaced without delay ”
This played no small part in the Church of England pulling out of coal and tar sands investments in its £9 Billion fund .
The popular sentiment was against fossil fuel use. And they were expressing this financially.
Shifts in Demand
Energy defines our lives today. As people and countries become wealthier, energy use first increases rapidly and then plateaus off or falls. Consider this: a poor farmer sends his daughter to college and then she gets a job in a multinational bank. Initially everyone in the farmer’s family would have either walked or taken a bus. They would have cooked in a wood-fired stove, and bought few clothes for Diwali. His daughter probably stays in a working-woman’s hostel and commutes to work in a spanking new two-wheeler. The family walks less and uses the bus more. They perhaps visit her in the city – travelling by train for the occasion and enjoy shopping and visiting malls.
But in the US or Germany, people maybe buying better insulation for their houses, going for more energy efficient appliances, so their energy consumption falls even while their “well-being” increases. You don’t add a second air conditioner in a room or drive in two cars. You might even adopt a solar powered Tesla as the new symbol of cool.
But the world has been consuming fossil fuels voraciously.
World demand for Crude Oil has grown from 80 million barrels per day (bpd) in 2003 to 94 million bpd in 2015 . Global coal consumption increased by more than 70% from 4600 Mt in 2000 to an estimated 7 876 Mt in 2013, and at a 4.2% annual rate – driven almost entirely by China .
But as in all things, totals and averages hide a fascinating diversity of detail.
First demand is falling in developed (OECD) countries who account for half of crude demand. Crude demand has fallen 10% in these countries in this period to just over 46 million bpd. Coal consumption in OECD countries has fallen by nearly 10% from 2002-2012 .
This is being driven in part by energy efficiency improvements, a shift to using natural gas and in part by warmer winters which is reducing the need for heating.
“If you look at the 24-year period, there is some warming in Europe and this has contributed to lower heat demand and lower greenhouse gas emissions,” said Ricardo Fernandez from the European Environment Agency. “In the last two years it has even been stronger in 2014 you can see that, while it’s not the only factor, by and large it’s due to the milder winter conditions in Europe.”
So the demand increase in the past decade was lead almost entirely by the growth of China and India. Chinese demand doubled in this time frame from 5.6 bpd to over 11.3 million bpd in 2015, while Indian demand growth has been slower in this period, growing from 2.5 million bpd in 2003 to 3.7 million bpd in 2014.
China’s demand for coal and crude is beginning to slow – faster than the economy is slowing, driven by shifts to less energy-intensive industries, to more renewable power, gains in efficiency and improving technology.
Indeed, Chinese energy-related greenhouse gas emissions declined by 1.5% in 2015, as coal use dropped for the second year in a row. In 2015, coal generated less than 70% of Chinese electricity, 10% less than in 2011. Over the same period low-carbon sources jumped from 19% to 28%, with hydro and wind accounting for most of the increase .
The other issue is efficiency; older coal plants operate at an efficiency of around 30% while newer plants operate at efficiencies closer to 45%. This means upgrading older plants will result both in savings of coal and CO2 emissions . China has been upgrading its coal plants aggressively.

Chinese Decoupling Energy

Figure 3: Chinese Oil Demand decoupling from GDP Growth
India is a big user of fossil fuels with a demand set to grow. India’s power is largely coal dominated, while her transportation network is driven primarily by oil and coal.
An estimated 240 million Indians do not have access to electricity today and several hundred million Indian households use wood-fired cook stoves that are very dangerous to health as their primary cooking medium . Also as Indians become wealthier and move to cities, their use of energy will grow: appliances, transportation and spending all improve as India becomes more urban and more wealthy.
The advantage India possesses is that it is beginning its development journey well after other countries, so it gets to “leapfrog” technologies – this is when countries can gain development while using newer and better technologies than the ones used by countries starting first.
An example might help: while India’s power is still largely produced by burning coal, India has access to newer technologies like gas-fired plants, windmills, or utility-scaled solar or even much more efficient coal plants. This way it can generate power in a less warming and less polluting fashion than say, England in the early 1800s. India’s coal is of very poor quality with high ash content that leads to very low efficiency. This makes a transition to either solar or more easily, natural gas more attractive on an economic basis.
India is building 20 km of roads every day in 2016. This could soon go up to 30 km of road per day as per Nitin Gadkari, India’s Road Transport and Highways Minister . In FY16, India added more than 20 million new vehicles on those roads.
But India’s energy intensity of GDP is declining. The energy intensity of the economy has decreased from 18.16 goe (grams of oil equivalent) per Rupee of GDP in 2005 to 15.02 goe per Rupee GDP in 2012, a decline of over 2.5% per annum despite a robust GDP growth in that period.
And India’s transportation sectors greenhouse gas emissions are a tiny fraction (0.3% in 2011) of overall global greenhouse gas emissions . Even if India were to double her transportation greenhouse gas emissions, this would not wreck the carbon budget.
There is another very real barrier to the increase of crude oil in countries like India. Congestion and convenience. A ride in one of Bangalore’s roads at almost any time of the day or in Delhi is enough to demonstrate this point in smoky, congested detail. In a study conducted by the Consortium of Traffic Engineers and Safety Trainers and reported by The Hindu shows that average vehicle speeds in Bangalore fell from 35 kmph in 2005 to 9.2 kmph in 2014. Data from IIT Madras, shows that vehicle speeds in Chennai (SP Road) fell from 49 kmph in 1992 to 20 kmph in 2014. This cannot continue. Something has to give – which is probably a shift to public transportation – either by bus (preferably) or to a metro. The latter can be powered off the grid, again lowering the need for crude while the former will place the crude demand on a much slower trajectory than the present.
India has also turned into a power-surplus country in 2017 after a gap of 8 years. Anyone who has spent the past few years in Tamil Nadu can attest to the fact that power cuts have reduced substantially. This, along with the introduction of the UDAY scheme of debt-restructuring for State Electricity Boards is set to sharply reduce the demand for diesel generator sets – another negative for crude demand.
Lastly, India has launched several energy efficiency schemes – notably the UJALA scheme whereby the government supplies LED bulbs at highly discounted rates to customer with a metered connection. To date (July 2016), more than 128 million lights have been distributed resulting in an energy saving of over 45 million units per day. Other schemes include changing agricultural pump sets to solar-powered pump sets and encouraging adoption of energy-efficient appliances.
This means India’s power demand will grow, no doubt. But it will grow slower than GDP growth and in a less carbon-intense way. The rise of solar will play a major role in India’s energy roadmap.
The rise in solar
The IEA preliminary data suggest that electricity generated by renewables played a critical role, having accounted for around 90% of new electricity generation in 2015; wind alone produced more than half of new electricity generation. In parallel, the global economy continued to grow by more than 3%, offering further evidence that the link between economic growth and emissions growth is weakening .
Solar power has had a dramatic transformation in the past decade. For India, capital costs of solar have plunged 70% from Rs. 18 million per MW to Rs. 5.3 million per MW in 2016 . Prices have fallen since. Replacement costs for coal are still much lower at Rs. 1.2 million – but these do not include the costs of pollution from coal.
Another way to consider this would be to look at levelised cost. This is the cost per unit of electricity generated from a given source taking into account capital costs, running costs, subsidies and pollution costs.
The buzz around Solar power in India hummed loudly on the announcement of reaching a 100 GW target by 2020. That was a INR 6 Billion announcement! That got all the foreign players interested. The rates fell rapidly in 2015 and into 2016.
In July 2015, Canadian Firm, SkyPower placed a “paradigm-shifting” bid of Rs. 5.05 per unit generated for a 50MW utility plant in Madhya Pradesh. Around that same time, many corporates were negotiating rooftop solar tariffs of between Rs. 6.50 to Rs. 7.20 per unit for 25 year agreements.
But this was not a unique event. In September 2015, Photon Solar won a 50 MW project in Punjab with a winning bid of Rs. 5.09.
Then came Sun Edison’s bid of Rs. 4.63 for a 500 MW project in Andhra Pradesh in November. The Livemint newspaper reported a comment from Pashupathy Gopalan, president, Sun Edison Asia Pacific “There are 15 or 20 companies that are in the same ballpark in their bids (as SunEdison). We are not particularly aggressive.”
Prices fell further. In 2016, for a 420 MW project in Rajasthan, several bidders quoted below Rs. 5/unit and the winning bid was Rs. 4.34 per unit.
Solar was now cheaper than coal.
Power Minister, Piyush Goyal tweeted “Through transparent auctions with a ready provision of land, transmission and the like, solar tariffs have come down below thermal power cost” .
In November of 2015, the consulting firm, KPMG released a report titled “Rising Sun” in which they stated that by 2025, solar would be substantially cheaper than coal! In hot countries like India with large T&D losses, solar is an easy choice to make – especially decentralized solar.
And the technology is improving every month. The next battle to be won is the battle in electricity storage. There are exciting advances being made here, which we shall consider later.
The death of king coal is not very far away.
The electric car

But Crude Oil is a different story. You see, crude oil goes into transportation, and until recently electric cars were a bit of a joke that even passionate environmentalists had a difficult time buying into.
Then came Tesla. With a turnover of over $4 Billion in 2015, and with a roadmap to profitability, Tesla made very cool, sexy and desirable cars. By the way, the cars ran on electricity.
Once in a while, you get one of those people who question the way things are done. Even more rarely, some of these questioners are imbued with a tremendous sense of energy, purpose and execution skills. They are the juggernauts that disrupt industries and the world.
One such person was Elon Musk. His entrepreneurial journey and love of space started early. At age 12, he programmed a space-themed PC game called Blastar which he sold for $500 to the magazine PC and Office Technology. Musk emigrated to Canada and then transferred to the University of Pennsylvania to complete double-bachelors in Physics and Economics. While in college, he and his best friend rented a frat house to run as an informal night club .
Shortly after dropping out of a PhD program in Stanford, Musk and his brother, Kimbal, started Zip2 developed and marketed an Internet “city guide” for the newspaper publishing industry. They had very little money at that time.
“Things were pretty tough in the early going” recalled Musk while speaking in 2003 at a Stanford University Technology Ventures Program. “I didn’t have any money…I couldn’t afford a place to stay and an office. So, I rented an office instead…and I just, sort of, slept on the futon and showered at the YMCA.”
Musk eventually sold Zip2 to Compaq for over $200 Million, pocketing $22 million in the process. His love for cars was evident in the fact that he used some of the money to buy a $1 million McLaren F1 car.
He also used the money to set up X.com, that later became Paypal. eBay acquired Paypal for $1.5 billion in stock in 2002 . Musk finally entered the big league.
Exiting Paypal left a void, and Elon Musk was still pursuing “Change the World” dreams. Influenced by Asimov, he wanted humans to populate other planets. This lead him to form Space-X. He was also very concerned about climate change and wanted to do something about it.
“I think global warming is a very serious issue and something that we have to address and the only way to address to address that is to come up with a car that doesn’t add Carbon emissions to the environment. And I think the way to do that is through electric vehicles.”
While electric vehicles do add carbon emissions to the environment depending on the fossil fuel content of the grid feeding them power, they had one big advantage. They displaced petroleum or diesel as a fuel source. This is a big deal – because grids could more easily be powered by low carbon sources than a car can.
Tesla was started in 2003, and not by Elon Musk. Indeed, Musk was an early investor who then transformed into the Chairman and later CEO. The first car in Tesla’s stable was the Roadster, a zippy, expensive sports car which appeared on the cover of Time Magazine in 2006 . In an August 2009 edition of The New Yorker, Lutz was quoted as saying, “All the geniuses here at General Motors kept saying lithium ion technology is 10 years away, and Toyota agreed with us—and boom, along comes Tesla. So I said, ‘How come some tiny little California startup, run by guys who know nothing about the car business, can do this, and we can’t?’ That was the crowbar that helped break up the log jam.”
Tesla then launched its multiple award winning model, the Model S in 2012. With over 100,000 vehicles sold to date, the Model S was one of the bestselling electric cars ever. Tesla followed this up with a Model X, an electric-powered SUV in 2015, with a mass market Model 3 opened for pre-booking in March 2016. Within a few days, more than 230,000 customers had pre-booked a vehicle, each pre-booking order needing a $1000 deposit !
Musk’s Alpha male persona was fully evident in the fact that the models names strung together read “S3X”.
A question I often get asked is “Are electric vehicles green?”. My answer is to say that it depends almost entirely on the grid feeding the electricity to the car. If the grid is powered largely by coal, then, no, an electric car is not green.
For India, based on the information from the Ministry of Power, our grid is about 60% coal-powered, 16% hydel, 12% “Other renewable” and 9% gas . In reality, the share of coal in generated units is probably a little higher, given that wind and hydel tend to be seasonal. The Central Electrical Administration has used emission factors to arrive at a 0.82 tons of CO2 per MWh of power generated . This means that for every unit of electricity generated, 820 grams of CO2 are emitted. Please note than other greenhouse gases are emitted but not captured in this estimation.
But the electric car is not charged at the point of generation. It is charged at our homes or offices. So the electricity has to travel all the way from the point of generation to the point of use, subjecting itself to a transmission and distribution loss. In India, this is about 23% officially and much higher unofficially. Some part of the loss is technical – i.e., losses that are physical in nature – due to friction, heat and other line losses caused both by the nature of transmission and by the aging equipment or overloading. The other part is “commercial” – units that are generated and used but not paid for – these include theft, agricultural units etc. There can be many points of view on how to assign the emissions caused by “lost” units, but, at the very least, we need to account for transmission losses when calculating the CO2 emissions emitted when a unit of electricity is consumed.
Using the above, the CO2 footprint (or the grams of CO2 emitted per kilometre travelled) is comparable for a Reva e20 at ~100 grams per km and a Nano at ~ 115 grams per km or a Maruti Alto 800 at 120 CO2 per km based on similar assumptions of driving conditions. This assumes that the Reva gives 90 km for a full charge, while the Nano does about 20 km per litre and the Alto, ~ 19 kmpl. Moreover, several studies show that if we were to add manufacturing CO2 emissions, or the emissions involved in making a car, an electric car in India has larger CO2 lifetime emissions than a comparable petrol car.
Most exciting is a recent announcement by Hanergy, a leading thin-film solar power company. They were using thin film solar panels – flexible solar panels, essentially to fashion a care that could charge itself. The company announcement said that 5-6 hours of sunlight was enough to allow the car to travel 80km on sunlight alone . The car is yet to be launched and the claims are yet to be tested. But if true, then zero-priced crude is not far away.
The journey will not be smooth
Coming back to why Saudi refused to cut. Consider the position of Saudi Arabia. As it stands, Saudi Arabia is facing “peak demand” – a prospect of continually falling crude oil demand even as the world economy grows – there’s a real chance that much of the oil under the ground may remain buried forever. With over 212 billion barrels of reserves, that’s a lot of oil to be left stranded.
And why should Saudi Arabia be the one to cut? Even at a $20 oil price, over 60% of Saudi’s reserves remain profitable to extract, while less than 1% of USA’s or Russia’s reserves are profitable to extract. While Saudi Arabia faces a budget shortfall at current oil prices, it has $700 billion reserves as a palliative to ease the pain. Moreover, its competition would feel more pain – Iran for instance. Just a third of Iran’s 128 billion barrels would be profitable to extract at $20 and Iran does not have the reserves that Saudi has.
Importantly, Saudi no longer has full control over the competitive dynamics of oil producers. They no longer form an effective cartel – they are too diverse. It’s highly unlikely that the entrepreneurial private American shale producers would follow Saudi’s lead in cutting. Nor would Russia or Iran.
Indeed, Iran’s re-entry into the global crude market in 2016 made for a structural shift in the market. For a decade, Iran had faced sanctions from the world for its pursuit of its nuclear weapons program. These sanctions were enhanced in 2012, when Iranian banks identified as institutions in breach of EU sanctions were disconnected from the SWIFT , the world’s hub of electronic financial transactions. In the same year, the EU said agreed to an oil embargo on Iran and to freeze the Iranian Central Bank’s assets. Sanctions tightened further when major super tanker companies said they would stop loading Iranian cargo. EU sanctions made European insurers, who dominated the marine insurance sector, from offering cover on Iranian crude. This insurance ban will affect 95 percent of the tanker fleet because their insurance falls under rules governed by European law. Historic negotiations ensued – which resulted in January 2016’s announcement by the International Atomic Energy Agency that Iran had adequately dismantled its nuclear program leading to lifting sanctions. Iran had re-entered the global crude markets.
Iran has large low-cost reserves – second only to Saudi Arabia. And it is not overly fond of the Saudis and unlikely to take their lead.
There was thus no competitive sense in cutting. This fact was echoed in the Saudi’s erstwhile Petroleum Minister’s statement. On 4th March 2015 in Berlin, Ali al-Naimi, a legendary figure in the world of oil, said
“Over the past eight months, though, with the market in surplus, it is Saudi Arabia that is called upon to make swift and dramatic cuts in production. This policy was tried in the 1980s and it was not a success. We will not make the same mistake again. ”
So what
Does this mean that crude and coal prices will assume a linear path to zero? Of course not. Oil reserves are concentrated in some of the most volatile places on the planet that are prone to daily violence. If the violence escalates, crude prices will shoot up. Many coal mines and oil rigs remain susceptible to climatic forces such as storms and flooding. These could also cause disruptions that would serve to price spikes.
As prices fall and some countries restrict their use of coal, the very cheapness of coal will ensure that it remains a preferred energy source for developing nations for a long time to come. Once a coal plant is built, it continues to produce as long as it covers marginal costs – or the costs incurred in producing just one additional tonne of coal from the plant . Consider what happened in 2016. European nations had cut their consumption of coal – both for environmental reasons and because natural gas was available at a cheaper price. China was reducing its coal production by restricting the number of days a plant could operate in a year – primarily because of the polluting effects of coal plants .
That caused a spike in international coal prices. But would that be long lived? Unlikely. India made an announcement in the middle of 2016 that it had sufficient coal to meet its domestic needs and was entering the international markets as an exporter. In an oversupplied market like coal, that’s what happens – when prices spike temporarily supply that has been paused re-enters the market to drive prices down again.
The true death knell for coal will come when energy storage options become much cheaper. This will make solar a competitive option for base load. What is base load? Electricity demand varies over the course of a day and over a year. For instance, energy use typically peaks in the day in India in summers as cooling needs are highest. While energy use peaks in winters in colder climates as heating needs increase. Base load is the minimum power required to be supplied throughout the day. Today base load is supplied by coal, natural gas, oil or nuclear. Renewable sources of energy are often seasonal or have a clear daily variation – the sun only shines in the day! But having a cost effective means of storing the energy would mean, renewables can start supplying base load and finally edge out fossil fuels.
What does this mean for India?
In many ways, the fall of crude and coal prices is a huge positive for India.
The first is a much lower import bill.
Consider this. Imports supply most of India’s crude oil consumption. While India’s consumption of crude oil-derived products like diesel or natural gas has been increasing, her domestic production of crude oil or gas has been steadily decreasing. Thus, India is increasingly becoming dependent on imports.
As such, a fall in international crude prices is one of the largest macro-economic positives for the Indian economy. Indeed, as per news reports, India’s crude oil import bill in FY16 nearly halved to $64 billion from $112.7 billion in FY15 even while the quantity imported increased nearly 7% to 202 MT . In Rupee terms, that’s a saving of more than Rs. 2.5 Lakh crores . While some of this saving was passed onto the Indian customer as lower prices, a large part was retained by the centre. This helped balance the budget to no small extent.
But there is another big saving for India and that has to do with subsidies. India’s major subsidies relate to food, petroleum and fertilisers. The combined subsidies on these three is greater than Rs. 3 lakh crores (or $95 Billion) in FY14 or about 5% of the GDP of that year.
Subsidies on petroleum products, which include subsides on diesel, kerosene and LPG, fell almost 80% from nearly Rs. 1.5 lakh crores in FY14, to just over Rs. 22,000 crores for 9 months in FY16 .
The fall in the subsidy burden has created a fiscal space that is a necessary (but not sufficient) first step in infrastructural improvements that India stands in crying need of.
There is another positive cycle that lower crude prices have set off. They have forced substitutes such as solar and coal to quote lower prices to retain their competitive positions. For instance, I doubt the solar bids would have been quite so aggressive had coal or crude prices been higher. This results in a lower net power costs for all manner of consumers – individuals and institutions.
Individuals travel more. Air travel has become cheaper and more popular as air turbine fuel prices have fallen. This in turn has strengthened the financial position of airlines and the loan positions of banks that lend to them. The poor, who face highly subsidised rates of petroleum products, have not gained because of crude or coal price fall, while most customers have not face the benefit, because retail prices have hardly fallen 15% or so from mid-2014 to now .
Unless lower energy prices are coupled with enforcing strict market discipline on our unwieldy state electricity boards, the consumers – individuals and companies – are unlikely to reap the full benefits of long term lower prices unless the buy directly from third party power producers or invest in roof top solar systems.
Energy Prices are falling in conjunction with another important trend: automation is rising. As automation grows in nature and in presence, even countries like India will opt to automate their processes. Take textiles, the second largest employer after agriculture in India. Modern textile mills have cut their employment progressively across the value chain – they do this in spite of low labour costs so as to ensure quality and to reduce dependence on a highly unpredictable labour force. Call center jobs are in jeopardy of losing out to “chatbots” – Artificial Intelligence software that can replace them. Lower energy prices tilt the choice towards investing in automation – not a good when India’s labour force is growing a third faster than the number of jobs available .
But before we celebrate, there is one big short term negative for India – one that is already being felt. Remittances are an important source of capital for India, and an important part of economies of states like Kerala that sends so many to the Gulf each year. India received $30 Billion in 2012 from the Middle East – almost half its total inward remittances for that year. That trend, thanks to the oil boom ending, is now reversing.
While writing this, I was asked, is this fall a good opportunity? Should India secure long term contracts at low prices now, before prices move up. My answer would be no. While $40 crude may look cheap to $140 crude, I will stick my neck out and say the world is a different place in 2016 than it was in 2011. Solar has turned the corner, Climate Change is increasingly being perceived as being an existential threat and fossil fuels are in an excess supply mode. Crude and Coal will fall. Let’s not try and catch a falling knife.