Structural Path Analysis Applied to India’s Carbon Emissions Li Yingzhu, Su Bin, Shyamasree Dasgupta IAEE, Singapore, 19 June 2017

Introduction Global efforts in climate change mitigation A lot of studies on China, but not many on India Around 7% of total global emissions by India Developing country with the 2nd largest population on the planet Important to understand India’s emissions profile and the impacts of different development strategies on emissions

Methodology for India’s Emissions Profile (a) Social Accounting Matrix (SAM) analysis: where factor inputs (i.e. labor, capital and land) and households are endogenous accounts Carbon emissions attributed to Government consumption Investment Exports

Methodology for India’s Emissions Profile (b) Structural Path Analysis (SPA) by transmission layer: Final Demand Intermediate inputs Intermediate input’s intermediate inputs Intermediate input’s intermediate input’s intermediate inputs, …

Methodology for Emissions Induced by Development (a) Structural Path Analysis (SPA) of emissions arising from exogenous demand shock by transmission layer:  Final Demand  Intermediate inputs  Intermediate input’s intermediate inputs  Intermediate input’s intermediate input’s intermediate inputs,…

Methodology for Emissions Induced by Development (b) Structural Path Analysis (SPA) of emissions arising from exogenous demand shock by transmission path: 1-node path 2-node path Am,m Am,i 3-node path Fm,mym yi 4-node path, … Fm,m 1ym Ai,m

Data India’s SAM 2007-08 by Pradhan et al. (2013) 78 production activities 5 factor inputs 9 household groups Energy/Carbon emissions data compiled from Annual Survey of Industries (2007-08) National Sample Survey (NSS) reports Energy Balance Table 2007-08 Others In 2007-08, India had around 1,398 million tons of carbon emissions from combustion 1,243 million tons or 89% from 78 production activities 155 million tons or 11% from households

India’s Emissions Profile (a)

India’s Emissions Profile (b)

Emissions Induced by Exogenous Demand Shock (a) 59 43

Emissions Induced by Exogenous Demand Shock (b1)

Emissions Induced by Exogenous Demand Shock (b2)

Discussion & Conclusion Investment is the major driver of India’s emissions Less than 20% of emissions arising from exports The Indian economy still depends primarily on domestic markets Emissions centralize in sectors whose outputs are key intermediate inputs Metals, Cement and Land Transport > 35% of total emissions Chemicals, the 4th emissive sector, <5% of total emissions Non-emissions intensive production activities may also lead to significant emissions Energy efficiency R&D Adoption Clean energy Wind power, solar power, biomass energy, hydropower, nuclear power, clean coal, etc.

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