AI Governance in Carbon Capture Technology: Bridging Indian Legal Frontiers for Climate Resilience – Part I

Natural disasters that are strikingglobally provide evidence of climate change and its effects. There is no room for inaction in the face of the obvious urgency of the need to combat climate change, and targeted action is now crucial. For future decarbonization efforts to reach global objectives, carbon capture, utilisation, and storage will be essential. India’s location at a pivotal juncture in history makes it a vital component in the effort to combat climate change. At the moment, India ranks fourth (4th) in terms of all installed renewable energy capacity,[i] fifth (5th) in terms of solar energy,[ii] and fourth (4th) in terms of wind energy.[iii] The ambitious goal set by the Indian government is to install 500 GW of renewable energy by 2030 and 175 GW by 2022.[iv] Carbon capture has received very little attention despite the several initiatives the Indian government is attempting to lessen its carbon footprint.[v]

A vital component of the solution matrix that the world is gradually moving towards to address the persistent threat posed by climate change is carbon capture and storage, or “CCS.” Given that carbon emissions from human activity are at previously unheard-of levels, a notable rise in global temperatures is all but certain. In light of this fact, the search for efficient mitigating strategies is at its peak, which is exactly where CCS technology excels.

In order to prevent carbon dioxide (“CO2”) emissions from being released into the environment during the production of electricity and other industrial operations, Carbon Capture and Storage (CCS) is a technical intervention.[vi] In essence, there are three steps involved in this process: capture, conveyance, and safe storage. The technology is a potential addition to the fight against climate change since it can absorb up to 90% of CO2 emissions.[vii]

Carbon Capture and Storage (CCS) can significantly lessen the negative effects of carbon emissions in a society increasingly driven by fossil fuels. Utilising CCS technology, power plants and industries—which are the main sources of CO2 emissions worldwide—can drastically lower their carbon footprint. One major factor in the creation of a carbon footprint is energy use. India has always relied heavily on fossil fuels.[viii] In actuality, India imports a sizable amount of oil, which has a big impact on the economy.[ix] A crucial element of law is the Electricity Act, 2003 (the “2003 Act”),[x] and the regulatory commissions instituted under the same play a significant role in encouraging the use of renewable energy sources.[xi] The idea of “Renewable Energy Certificates” (or “RECs”), which are market tools used to encourage renewable energy in electricity, was first presented by the Central Electricity Regulatory Commission (“CERC”) in 2010.[xii] In addition, the CERC has been in charge of other historic initiatives like updating the Indian Electricity Grid Code, lowering regulatory and compliance burdens for companies to facilitate business dealings in the renewable energy space, and introducing numerous significant renewable energy laws such as the “CERC (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2020”[xiii] and the “CERC (Terms and Conditions for recognition and issuance of Renewable Energy Certificate for Renewable Energy Generation) Regulations, 2022.”[xiv] India’s renewable energy capacity reached 168.96 GW as of 2023 as a result of the ERCs’ efforts, demonstrating the government of India’s goal to establish a sizable renewable energy capacity.[xv]

[Image Sources: Shutterstock]

The State Electricity Regulatory Commission (“SERC”) was right to promote renewable energy and require generating companies to abide by its regulations in this regard under Section 86(1)(e) of the 2003 Act,[xvi] in conjunction with the National Electricity Policy of 2005,[xvii] the National Tariff Policy of 2006,[xviii] and India’s international obligations under the Kyoto Protocol.[xix] This ruling was made in the case of Hindustan Zinc Ltd. v. Rajasthan Electricity Regulatory Commission.[xx] Additionally, the Hon’ble Supreme Court decided that the State ERC was right to follow suit – “…to discharge the constitutional obligations as mandated under Article 21 — Fundamental Right of the citizens and Article 48-A – the Directive Principles of State Policy and to discharge the Fundamental Duties by the respondents as envisaged under Article 51-A(g) of the Constitution of India.”[xxi] The similar idea can be used as a temporary fix if India does not yet have a comprehensive CCS strategy. Unfortunately, India does not yet have any explicit laws or policies that support CCS. NITI Aayog has produced a policy report for the deployment and policy framework of CCS in India,[xxii] however it makes no specific recommendations for legislation or regulations that may be put into place to control and regulate CCS. In a similar vein, the 2003 Act contains no provisions pertaining to data protection, privacy, or security, which exposes the application of AI in CCS to an increasing number of risks and difficulties including cyberattacks, data leaks, ambiguous rules regarding the need for consent for data sharing, and numerous other risks and difficulties of a similar nature.

Due to their ability to set prices, regulatory agencies in India—most notably the CERC and the several SERCs—have a major impact on the development of the country’s energy industry. Therefore, the financial feasibility of energy projects is determined by these rates. Although there is no denying that CCS technology has the potential to lessen the catastrophic effects of climate change, it is crucial to carefully examine the economic factors that surround its implementation. The current state of CCS technology makes it costly both in terms of initial capital expenditure and continuing operating expenses. Therefore, in the absence of financial incentives, its widespread adoption could continue to be economically impractical. Under this scenario, tariff discounts for power plants incorporating CCS might allow CERCs and SERCs to play a transformative role. This can be carried out in addition to India’s current framework for CCS policy. But it’s important to carefully consider the following financial ramifications of these concessions:

The Effect on Energy Tariffs That Are Not CCS

The possible effects of tariffs on non-CCS energy sources are an important consideration. These concessions run the danger of unintentionally raising non-CCS energy tariffs, which would put an unfair burden on customers.

Concession Sustainability

Another crucial aspect to consider is the concessions’ long-term viability in relation to CCS. It is critical to evaluate if these concessions on CCS would put a pressure on the entire regulatory budget or preserve their long-term financial viability.

Equilibrium with Other Renewable Energy subsidies

Lastly, the relative importance of these concessions to other renewable energy subsidies cannot be overstated. Ensuring a strong and equitable renewable energy market with level playing fields for competing technologies should be the aim. It is important that we exercise caution to avoid fostering an atmosphere that unduly benefits CCS technology at the expense of other workable renewable energy sources.

The potential of CCS enables “negative emissions,” essentially removing CO2 from the environment, when paired with sustainable biomass. The fact that this approach works with the current infrastructure and allows the industrial and electricity sectors to run with lower emissions makes it appealing. This offers a smooth transitional route to renewable energy without upsetting the natural balance of the future or the needs for energy now. However, the lack of a clear market for collected carbon and the complexity of the technology make its adoption difficult. Infrastructure projects also cost a significant amount of money. Additionally, considering potential dangers including induced seismicity, groundwater pollution, and the potential release of stored carbon back into the atmosphere, safe and secure storage of collected carbon—primarily through geologic sequestration—is a basic necessity. Therefore, even while CCS is not a cure-all for climate change, it is an essential part of the global plan to combat it, particularly as countries strive to meet their commitments under the Paris Agreement.[xxiii] But in order to fully realise its potential, addressing related issues through strong regulatory monitoring is essential, underscoring the necessity of a well-established legislative framework for its control.

The potential of artificial intelligence (“AI”) in overcoming these obstacles and advancing technology also becomes clear. Our lives now involve technology and AI in one way or another. In reality, scientists are trying to develop virtual versions of humans in order to facilitate future medical treatments, according to the most recent study and technology. AI will be used more and more in every industry. Indeed, a number of experts have emphasised the part AI plays in comprehending climate change and forecasting different outcomes.[xxiv]All of this will, however, need the collection of high-quality data, which is why regulation of AI and CCS will be required. The combination of these elements emphasises the necessity of a thorough legal framework that takes into account AI’s involvement in CCS technology. Through such intersections of technology, politics, and law, we may perhaps guide our planet towards a path of resilience and recovery, even if the trip towards a more sustainable future is definitely complex.

Author: Kaustubh Kumar, in case of any queries please contact/write back to us via email to [email protected] or at IIPRD. 

REFERENCES

[i]Year- End Review 2022- Ministry of New and Renewable Energy, Press Information Bureau (Dec. 20, 2022), https://pib.gov.in/PressReleasePage.aspx?PRID=1885147.

[ii]Id.

[iii]Id.

[iv] United Nations, India’s Long-Term Low-Carbon Development Strategy, Submission to the United Nations Framework Convention on Climate Change, Ministry of Environment, Forest and Climate Change Government of India (2022), https://unfccc.int/sites/default/files/resource/India_LTLEDS.pdf.

[v]IRENA, Renewable Energy Prospects for India, a working paper based on Remap, The International Renewable Energy Agency (IRENA), Abu Dhabi (2017), www.irena.org/remap.

[vi] Carbon capture expertise secured, The Courier (May 28, 2015, 04:20 PM), https://www.thecourier.co.uk/business-environment/business/205735/carbon-capture-expertise-secured/.

[vii]Carbon Capture, Center for Climate and Energy Solutions, https://www.c2es.org/content/carbon-capture/ (last visited Nov. 18, 2023).

[viii]Energy in India today, India Energy Outlook (2021), https://www.iea.org/reports/india-energy-outlook-2021/energy-in-india-today.

[ix] Hari Seshasayee, India’s Moment in the Geopolitics of Oil, Observer Research Foundation (Apr. 04, 2023), https://www.orfonline.org/research/indias-moment-in-the-geopolitics-of-oil/.

[x] The Electricity Act, 2003, No. 36, Acts of Parliament, 2003 (India).

[xi]The Electricity Act, 2003 §§ 76, 82.

[xii] Rajesh Kumar, Arun Agarwala, Renewable Energy Certificate and Perform, Achieve, Trade mechanisms toenhance the energy security for India, 55 Energy Policy 669, 671 (2013).

[xiii] The Central Electricity Regulatory Commission (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2020, https://cercind.gov.in/2020/regulation/159_reg.pdf (last visited Nov. 18, 2023).

[xiv]The Central Electricity Regulatory Commission (Terms and Conditions for Tariff determination from Renewable Energy Sources) Regulations, 2022, https://cercind.gov.in/regulations/REC-Regulations-2022.pdf (last visited Nov. 18, 2023).

[xv]India’s renewable energy capacity reaches 168.96 GW till Feb 2023: Minister R K Singh, The Economic Times, (Mar. 21, 2023, 03:56 PM), https://economictimes.indiatimes.com/industry/renewables/indias-renewable-energy-capacity-reaches-168-96-gw-till-feb-2023-minister-r-k-singh/articleshow/98862427.cms

[xvi] The Electricity Act, 2003 § 86(1)(e).

[xvii] The National Electricity Policy, 2005.

[xviii] The National Tariff Policy, 2006.

[xix]India’s Commitment to Kyoto Protocol, Press Information Bureau (Dec. 01, 2010), https://pib.gov.in/newsite/PrintRelease.aspx?relid=67897.

[xx] (2015) 12 SCC 611.

[xxi]Id. ¶ 30.

[xxii]Carbon Capture, Utilization and Storage (CCUS), Policy Framework and its Deployment Mechanism in India, NITI Aayog, (Nov. 2022), https://www.niti.gov.in/sites/default/files/2022-12/CCUS-Report.pdf.

[xxiii]Anand Singha, India only G20 member to meet commitments of Paris agreement on environment, says Modi, CNBC (Jun. 23, 2023, 06:07 AM), https://www.cnbctv18.com/environment/india-only-g20-country-to-uphold-paris-agreement-on-environment-modi-usa-17016351.htm.

[xxiv] Josh Cowls, Andreas Tsamados, Mariarosaria Taddeo, Luciano Floridi,The AI gambit: leveraging artificial intelligence to combat climate change-opportunities, challenges, and recommendations, 38(1)AI Soc. 283, 307 (2023).