Editorials/Opinions Analysis For UPSC 18 July 2023

Editorials/Opinions Analysis For UPSC 18 July 2023

Contents

1. National Coal Gasification Mission
2. Creating Trust and Collaboration to Distribute CSR Funds for Climate Action

National Coal Gasification Mission

Context

• The Ministry of Coal in India is developing a Comprehensive Scheme- National Coal Gasification Mission- to promote coal gasification, intending to accomplish 100 Million Tonnes (MT) of coal Gasification by FY 2030.
• A Steering Committee, chaired by Dr. V.K. Saraswat, has been constituted to oversee the implementation of the National Mission.

Relevance: 

GS Paper 3: Environmental Pollution, Renewable Resource of Energy

Mains Question

What are the main obstacles and factors that must be taken into account while developing and putting into practise coal gasification projects in India, and how can the government guarantee the long-term profitability and sustainability of this technology in the nation’s energy system? (250 Words)

The essential points of the scheme are as follows:

• Initiative: The programme aims to capitalize on natural resources and demonstrate coal gasification’s financial and technical potential. It aims to entice both the private sector and government-owned Public Sector Undertakings (PSUs) to invest in and develop in the coal gasification sector.
• Method of Selection: Companies for the coal/lignite gasification plan will be chosen through a fair and open bidding process. The government would provide budgetary support for eligible government PSUs and private sector organisations to carry out coal gasification projects.
• Importance: By promoting sustainable practises and reducing carbon emissions, this project could help the world meet its obligations to a greener future. It might lessen the harm that using coal does to the environment.

Coal gasification:

• Method: To create a fuel gas, coal is partially oxidised with air, oxygen, steam, or carbon dioxide. Syngas is a gas that can be utilised to produce energy instead of methane or piped natural gas. Another method is known as Underground Coal Gasification (UCG), in which coal is gasified while remaining in the seam and then removed through wells.
• Syngas Production: Methane, carbon monoxide, hydrogen, carbon dioxide, and water vapour make up the majority of syngas. It has many uses, including the synthesis of synthetic materials, fuels, fertilisers, and solvents.
• Importance: By substituting inexpensive domestic syngas for pricey imported coking coal, coal gasification can assist steel firms in lowering costs. In addition, it is employed in the manufacture of chemical feedstocks and energy. The ammonia produced from the hydrogen produced by coal gasification can be utilised to fuel a hydrogen economy.

Economy with Hydrogen

The term “hydrogen economy” describes an economic system in which hydrogen serves as the main form of transportation for goods and services and accounts for a sizeable amount of a country’s energy needs. It is predicated on the use of hydrogen as a clean and carbon-free fuel substitute.

The following are some crucial ideas about the hydrogen economy:

• Zero-Carbon Fuel: Since hydrogen does not emit carbon dioxide when used as an energy source, it is regarded as a zero-carbon fuel. As a result, it offers a tempting alternative for lowering greenhouse gas emissions and halting climate change.
• Renewable Energy: Renewable energy sources including solar, wind, and hydroelectric power can be used to make hydrogen. This means that environmentally friendly and sustainable methods of producing hydrogen are viable options for the hydrogen economy.
• Applications: In the hydrogen economy, hydrogen can be used as fuel for a variety of devices, including energy storage devices, long-distance energy transportation, and cars (hydrogen fuel cell vehicles). It might take the place of fossil fuels in these industries, resulting in a cleaner and more sustainable energy environment.
• Pathways: The generation, storage, transportation, and use of hydrogen are only a few of the interconnected pathways that make up the hydrogen economy. These routes include equipment and systems for efficiently producing, storing, distributing, and using hydrogen.
• Definition and History: Scientist John Bockris first used the term “Hydrogen Economy” in 1970. He suggested that the current hydrocarbon-based economy may be replaced with one based on hydrogen, creating a cleaner and more environmentally friendly world.
• The government has announced the National Green Hydrogen Mission, which will cost a total of Rs 19,744 crore. The goal of the initiative is to make India, one of the largest emitters of greenhouse gases in the world, a global centre for the production of this clean energy source by 2070.
• A future in which hydrogen significantly contributes to supplying energy, lowering carbon emissions, and fostering sustainable growth is the hydrogen economy. It has drawn interest as a potential remedy for problems related to climate change and the shift to a low-carbon energy system.

Coal gasification has the following benefits:

• Pollution Reduction: By reducing pollution from direct coal burning, coal gasification can assist address regional pollution issues.
• Use of Chemical qualities: Coal’s chemical qualities can be used in a variety of ways thanks to gasification.
• Cleaner Alternative: Coal gasification is seen as a cleaner alternative to conventional coal burning.
• Iron, methanol, urea, and other chemicals can all be produced using coal gas, which can also be transformed into chemical energy.
• Carbon Capture and Storage: Coal gasification makes it possible to separate and capture carbon dioxide, opening the door to prospective CCS technologies.

The following are some drawbacks of coal gasification:

• Carbon Intensity: According to certain research, coal gasification could result in higher carbon intensity by emitting more CO2 than conventional coal plants.
• Water Intensive: Coal gasification uses a lot of water, which might be problematic in areas where there are already water shortages.
• Efficiency: Coal, a relatively high-quality energy source, is transformed into a lower-quality gas form during the coal gasification process. Low conversion efficiency is the outcome of this conversion’s substantial energy consumption.

India needs to encourage coal gasification projects:

• Aatmanirbhar Bharat (Self-Reliant India): Supporting coal gasification projects can help India achieve its goal of being self-sufficient by generating jobs in the industry.
• Import Reduction: The installation of coal gasification is anticipated to result in a considerable decrease in imports by 2030, improving energy security and stimulating the economy.
• Coal Sector Self-Sufficiency: To meet the nation’s fuel needs, the government seeks to establish self-sufficiency in the coal sector.
• Technological Advancements: For the sector to flourish and increase productivity, safety, and cost-effectiveness, it will be essential to adopt new technologies and create digital infrastructure.
• Rising Hydrogen need: Coal gasification can help manufacture hydrogen, which is currently made from natural gas, as India’s need for hydrogen is anticipated to climb.

Government Actions:

• Revenue Share Concession: To encourage the use of cleaner fuels, the government has granted a 20% revenue share concession on coal used for gasification.
• Gasification facilities by CIL: Coal India Limited (CIL) has inked an MOU with GAIL for the commercialization of synthetic natural gas and wants to build gasification facilities through international tenders.
• National Coal Gasification Mission: To raise awareness, construct a workable road map, and reach the goal of 100 MT coal gasification by 2030, the Ministry of Coal is establishing the National Coal Gasification Mission.

Conclusion

• To ensure sustainable development, the government should carry out a thorough assessment of the effects coal gasification projects would have on the environment, the economy, and society. Coal gasification technology can advance and become more effective and ecologically benign with further investment in research and development. Place a focus on the creation of a varied energy mix that consists of sustainable alternatives to coal-based energy generation as well as renewable energy sources and energy efficiency measures. To ensure sustainable development in the industry, learn from international experiences and best practises in the deployment of hydrogen economies and coal gasification.
• In general, the government is focusing on coal gasification in order to efficiently utilise the country’s coal supplies, advance sustainability, and satisfy the rising demand for electricity and chemicals.

Creating Trust and Collaboration to Distribute CSR Funds for Climate Action

Context

The RBI’s most recent report on money and finance makes policy recommendations to reduce climate risks and help India reach its target of net zero emissions by 2070. One option is to make corporate social responsibility (CSR) spending geographically diverse by law. Although this is a good idea, putting it into practise will necessitate a change in the ecosystem so that CSR cash is distributed more fairly.

Relevance –

• GS Paper 2 – Welfare Schemes
• GS Paper 3 – Indian Economy – Private Sector
• GS Paper 4 – Ethics in Public-Private Relationship

Mains Question

Analyse critically the difficulties encountered in distributing funds and CSR programmes fairly in India. Discuss the effects of financing being concentrated in industrialised states and offer solutions to this problem. (150 words)

What is Corporate Social Responsibility (CSR)?

• CSR is a concept that places an emphasis on a company’s obligation to support the social, economic, and environmental advancement of society while also having a positive effect on society as a whole.
• A important piece of legislation, the Companies Act of 2013, made India the first nation to require and quantify CSR spending.
• The government’s goal to involve businesses in the agenda for national development is shown in the inclusion of CSR in the Act, which acknowledges their contribution to promoting sustainable growth and resolving social issues.
• This legislation has made it possible for businesses to actively take part in community-building initiatives and promote ethical corporate conduct for the benefit of society as a whole.
• Companies that must form a CSR Committee are those that met one of the following criteria in the immediately preceding financial year: 1. Net worth must be at least Rs 500 crore; 2. Turnover must be at least Rs 1000 crore; or 3. Net profit must be at least Rs 5 crore.
• The corporations (Amendment) Act of 2019 states that corporations have CSR obligations even before they have operated for three financial years.
• Businesses are required to invest a minimum of 2% of their average net income from the three fiscal years prior in CSR initiatives. The average net earnings made in the three prior financial years are taken into account for businesses that have not yet completed three full fiscal years.
• It is crucial to keep in mind that CSR activities in India shouldn’t be carried out as a part of typical corporate operations, but rather should be in line with any of the 17 activities listed in Schedule VII of the act.
• The main goal of CSR is to encourage firms to create creative ideas and establish reliable management systems by promoting a responsible and sustainable business philosophy on a large scale.

Funding for CSR is concentrated in industrialised countries.

Companies must provide precedence when allocating CSR funding to regions close to where they operate, according to Section 135 of the Companies Act. More money has been allocated for social issues as a result, although investment has also been focused in the most developed states. By 2020–21, 10 states would have received 80% of all CSR funds. The Ministry of Corporate Affairs made it clear in 2021 that giving local communities preference is not required and that the goal of the law is to match CSR with broader societal objectives. The funding concentration in a small number of states, however, implies that businesses still like to focus their CSR funding locally.

Being aware of local preferences for CSR funding

This inclination results from a desire to support local communities that are close to where their businesses are located and in areas where they are familiar with the difficulties. Local initiatives give funders the chance to make the most of their local expertise, tap into their networks and existing contacts, and exert more control over the results through staff visits and monitoring. As a result, corporations are able to acquire a “social licence to operate” because to the increased goodwill and influence they gain through helping out their local communities. The licence to operate is a significant motivator for favouring local projects.

Regulatory Change for Diversification: Challenges in Funding and Diversifying CSR Projects

• Overcoming Local Preference: To offset the significant preference for local initiatives, regulatory measures are needed in order to diversify CSR programmes and funding.
• Breaking Down Barriers: In order to enter new markets and regions and broaden their CSR initiatives, businesses must learn how to negotiate regulatory frameworks.
• Finding Local Needs and Reaching Remote Locations
• Geographical Challenges: For businesses looking to diversify their CSR programmes, accessing rural places presents a considerable difficulty.
• Understanding Local Needs: Effective project implementation and effectiveness depend on pinpointing the precise needs and priorities of local populations in uncharted territory.
• Searching for Reliable Implementation Partners
• Partnering with Local Expertise: Businesses may have trouble locating dependable implementation partners who are knowledgeable with the unfamiliar industries and localities.
• Forming Partnerships: Creating connections with neighbourhood grassroots organisations, social entrepreneurs, and non-profits will help you get the knowledge you need and reliable partners.
• Impact on National Platforms Demonstrated
• Communication Gap: Grassroots non-profit organisations frequently lack the tools and platforms necessary to demonstrate their impact on a national level, which leaves a void in their ability to engage potential funders.
• Resolving Visibility Issues: Finding ways to close the knowledge gap and draw attention to the accomplishments of grassroots organisations is crucial for securing CSR funding and support.

Making the Switch to an Equitable Distribution

• Accessing Remote Locations: It can be logistically difficult to participate in CSR projects in remote locations. It is challenging for businesses to reach these locations and evaluate the needs of local communities because to a lack of infrastructure, connection, and transit choices.
• Determining Community Needs: It takes substantial investigation and participation to comprehend the particular requirements and priorities of communities in various places. Companies must take the time and make the effort to fully understand the social, economic, and environmental background of each town because each one faces particular obstacles.
• Locating Reliable Implementation Partners: Successful CSR efforts depend on working with neighbourhood nonprofits, social enterprises, and grassroots initiatives. But it can be difficult to locate reliable partners with the required knowledge and experience in foreign countries. It may take some time to build relationships and make sure that aims and values are in line.
• Information vacuum with donors: Grassroots non-profit groups frequently find it difficult to highlight their influence on national platforms, which causes an information vacuum between these groups and potential donors. Their failure to demonstrate the success and durability of their projects is hampered by a lack of resources and communication channels, making it difficult for businesses to recognise and support them.

Facilitating Equitable Fund Distribution:

• The Contribution of the Government and the Development Sector
• Utilising Non-profit Organisations Across India to Promote Local Impact
• Elevating effect: Larger-budget Pan-India non-profits play a critical role in promoting and exhibiting the effect made by grassroots partners, giving them more visibility and recognition.
• Compliance and Support: These non-profits give grassroots organisations invaluable compliance assistance, capacity building, and technical support, enabling them to successfully carry out initiatives and showcase their strengths.
• Reliable Conduits: By serving as dependable go-betweens, these businesses link up with community partners to ensure more equal CSR funding distribution and strengthen the social ecosystem.

Increasing Ecosystem Strength through Information Sharing and Middlemen

• Trusted Information Repository: Businesses can engage with the right grassroots partners by using intermediaries and ecosystem-building organisations to manage trusted information repositories regarding grassroots projects.
• Matchmaking for Equitable Partnerships: By utilising their networks and knowledge, intermediaries assist businesses in finding grassroots organisations throughout the world, fostering inclusivity in the allocation of CSR funds and assisting worthwhile projects.
• Fostering Collaboration: By encouraging cooperation between businesses, non-profits, and community-based organisations, intermediaries boost the social ecosystem and enable more successful CSR efforts.

Working with Local Governments to Achieve Consistent Impact

• Aspirational District Programme (ADP): By working with local governments on projects like the ADP, businesses may coordinate their CSR initiatives with federal, state, and municipal initiatives, fostering convergence and maximising impact.
• Promoting Collaboration: Promoting a collaborative approach to CSR across local, state, and federal governing bodies, outside organisations, and businesses helps initiatives be implemented successfully and satisfy community needs.
• Simplifying Implementation: Collaboration with local governments simplifies district administration tasks, ensuring effective CSR project execution in at-risk areas and boosting total impact.

Accountability and transparency are ensured

• Dealing with Compliance: Nonprofits, intermediaries, and local governments are crucial in ensuring compliance with CSR legislation and guidelines, encouraging responsibility and openness in the use of funds.
• Government Oversight: Working with local governments adds a new level of accountability and oversight, ensuring that CSR monies are used wisely and in line with regional development strategies.
• Maximising Impact: Businesses can respond to urgent community needs and maximise the beneficial social and environmental impact of their projects by coordinating CSR initiatives with local development priorities.

Increasing Technology Efficiency and Balanced Accountability in CSR Monitoring and Evaluation

• Striking a balance between allowing autonomy to non-profits and guaranteeing accountability to the donors is important when businesses and non-profit organisations collaborate.
• Technology-enabled Monitoring and Evaluation: Businesses can rely on technology-enabled monitoring and evaluation models to solve issues in remote projects where on-site visits may be restricted.
• Using Resources and technologies: The epidemic has sped up the use of numerous resources and technologies, including real-time data sharing, dashboards, sophisticated accounting software, virtual field trips, and video conferencing.
• Transparent data exchange, remote project monitoring, and increased evaluation process efficiency are all made possible by these technologically advanced solutions.
• Facilitating Non-profit Technology Adoption: Efforts should be made to assist non-profit organisations in embracing and effectively utilising technology, ensuring they have access to the tools, training, and infrastructure required to put in place digital monitoring and evaluation systems.

Creating Trusted Alliances with a National Impact

• Companies must form reliable alliances in order to truly participate as national partners in achieving environmental and social goals.
• It is important to establish reliable alliances with a variety of municipal authorities and charity organisations.
• These partnerships will aid in the equitable distribution of CSR funding, and they will help to build real impact and successfully solve environmental and social issues.

Conclusion:

To achieve an equal allocation of CSR funding for climate action, legal changes, ecosystem modifications, and an emphasis on fostering collaboration are all necessary. To have a significant influence and contribute to India’s net-zero target, businesses must diversify their ventures, cultivate partnerships, use technology, and cooperate with government initiatives. While ecosystem-level trust-building enables cooperation between businesses, non-profits, and local governments, mandatory geographic diversification can help break concentration. Remote monitoring and assessment are made possible by leveraging technology, and efficient execution is made possible by alignment with government initiatives. This all-encompassing strategy provides openness, accountability, and more participation, enabling a resilient and sustainable future for everybody.