As the country is trying to meet ambitious renewable energy goals as well as development needs with finite financial resources, moving to a low-carbon economy can help it maximise its financial capacity to meet economic and development goals, which will result in a saving of USD 600 billion for more productive investments, says CPI.

The Climate Policy Initiative is a global policy effectiveness analysis and advisory organisation with a mission to assess, diagnose, and support nations' efforts to achieve low-carbon growth.

An independent, not-for-profit organisation supported by a grant from the Open Society Foundations, CPI is headquartered in the US, and has offices and programmes in Brazil, China, Europe, India, and Indonesia. It uses the International Energy Agency's business-as-usual and two degree change assumptions to simulate current and low-carbon energy pathways.
    
The country has set a target of 20 GW solar energy by 2020 under the national solar mission, while the target from the wind energy is three time more at 65.5 GW.

The report further said transitioning to a low-carbon electricity system could also bring financial savings if the country can reduce the cost of finance. These savings, when coupled with a reduction in the high financing costs can provide the country with additional financial capacity to meet its economic and development goals.

The CPI report warned that the government and banks should also be aware of future risks of fossil-fuel asset value losses of the potential new coal-fired power plants that are currently planned or under construction, 77 per cent are at risk of causing asset value loss, it said, adding that long-term, low-cost debt can reduce the cost of low-carbon power by 30 per cent in the country.

"Our analysis reveals that with the right policy choices, over the next 20 years India and the rest of the world can achieve the emissions reductions necessary for a safer, more stable climate and still free up billions of dollars for investment in development and other parts of the economy,"
said CPI senior director David Nelson.
    
On China, the report said since it is the biggest polluter apart from being the biggest consumer of oil, a transition away from oil and with the right policies, can lead to a net benefit to the financial system of over USD 1 trillion.

China, the US, Europe and India are the four largest polluters and the biggest consumers of fossil fuel. China and other net oil consuming countries together comprise three-fourths of global oil demand.

Similarly the EU, which is also a net consumer of oil can lead to a net benefit to the financial system of over USD 1 trillion by adopting no-fossil fuel based technologies. On the US, the report said being a net consumer of oil, the US, with the right policies, can save more than USD
300 billion.

The savings that the US will accrue is lesser than other economies as the large majority of its fossil fuel assets are privately owned with the governments, including municipal utilities, owning only around 20 per cent of the coal-fired power plants and little of oil, coal,or natural gas
assets, CPI said.

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