Daily News Analysis 01 June 2023

Table of Contents

GS-3                   

1. A Way Out of the Coal Trap

Facts for Prelims

1. Guarani tribe
2. Lightweight and portable payment system
3. Khorramshahr- 4 Ballistic Missile

A Way Out of the Coal Trap

Context: It seems the government is contemplating a ban on setting up new coal-based power stations.

India’s Coal Demand:

1. India’s demand for coal has risen to 784.6 million tonnes for the financial year ending March 2023.
2. However, today, India’s projected annual coal shortage is at 49.3 million tonnes, three times the previous estimates of 17.7 million tonnes.
3. Coal shortage is prompting the government to start developing these coal projects.

Significance of the move:

1. It shows India’s commitment to fight climate change and reduce greenhouse gas emissions.
2. India’s proposed coal power capacity is the highest after China. Both India and China account for about 80% of all active coal projects.
3. Aligns with the global trend of phasing out coal and shifting to cleaner sources of energy.
4. Encourages the development of renewable energy (RE) and energy efficiency.
5. The government plans to achieve an installed renewable energy capacity of 500 GW by 2030 and net zero carbon neutrality by 2070.

Ban on coal-based power stations vs power demand

About the ban:

1. The government may need to rethink upon the ban on setting up new coal-based power stations. Although, the plants which are already under construction will be allowed to continue.

Power demand:

1. The government has said that in order to meet the power demand in 2029-30, an additional capacity of about 16,000 MW of coal-based capacity would be required.
2. This would be over and above the capacity of about 27,000 MW already under construction.
3. The need for additional capacity of 16,900 MW has been cited in the report of the Central Electricity Authority (CEA) called Optimal Generation Capacity Mix, which was released recently.

Ways to reduce coal dependency:

• Increasing Renewable Energy Capacity: India has set a target of increasing its renewable energy capacity to 500 gigawatts by 2030, which would help reduce the share of coal in the power mix.
  1. Renewable energy sources such as solar, wind, hydro and biomass can provide clean, affordable, and reliable electricity for India’s growing population and economy.
• Improving Energy Efficiency: India can save energy and reduce emissions by improving the efficiency of its power plants, industries, buildings, appliances and vehicles.
  1. Energy efficiency measures can also lower electricity bills, create jobs and enhance competitiveness.
• Phasing out Old and Inefficient Coal Plants: India can retire its old and inefficient coal-fired power plants that are costly to run and maintain and replace them with cleaner and cheaper alternatives.
• Diversifying Energy Sources: India can reduce its reliance on coal by diversifying its energy sources and increasing the share of natural gas, nuclear and hydro power in its energy mix.
  1. These sources can provide flexibility and stability to the grid and complement the variable output of renewable energy.
• Strengthening Grid Infrastructure: India can improve its grid infrastructure and transmission networks to enable the integration of more renewable energy and reduce losses and outages.
  1. India can also invest in smart grids, energy storage and demand response technologies to enhance grid reliability and resilience.

Challenges associated with clean and green energy alternatives:

• The poor financial condition of power distribution companies (DISCOMs), most of which are owned by state governments. DISCOMs are the main buyers of renewable energy, but they often delay payments to generators or curtail their power due to low demand or high costs.
  1. This affects the viability and bankability of renewable energy projects.
• The lack of adequate grid infrastructure and storage capacity to integrate variable renewable energy sources, such as solar and wind, into the power system.
  1. This requires investments in transmission lines, substations, smart meters, demand response and battery storage to ensure reliability and stability of supply.
• The lack of financial intermediaries and instruments to mobilize capital for renewable energy projects, especially from domestic sources.
  1. India relies heavily on foreign financing for its renewable energy sector, which exposes it to currency risks and policy uncertainties.
• The lack of investor understanding and awareness of the opportunities and benefits of renewable energy, especially among small and medium enterprises, households and rural communities.
• The poor financial condition of power distribution companies (DISCOMs), most of which are owned by state governments.
  1. DISCOMs are the main buyers of renewable energy, but they often delay payments to generators or curtail their power due to low demand or high costs.
  2. This affects the viability and bankability of renewable energy projects.
• The lack of adequate grid infrastructure and storage capacity to integrate variable renewable energy sources, such as solar and wind, into the power system.
  1. This requires investments in transmission lines, substations, smart meters, demand response and battery storage to ensure reliability and stability of supply.
• The lack of financial intermediaries and instruments to mobilize capital for renewable energy projects, especially from domestic sources.
  1. India relies heavily on foreign financing for its renewable energy sector, which exposes it to currency risks and policy uncertainties.
• The lack of investor understanding and awareness of the opportunities and benefits of renewable energy, especially among small and medium enterprises, households and rural communities.

Way Forward:

There is a need to improve information dissemination, capacity building, technical assistance and consumer engagement to increase the adoption and acceptance of renewable energy solutions.

Strengthening the grid infrastructure and storage capacity by investing in transmission and distribution networks, enhancing grid flexibility and resilience, and deploying battery storage and pumped hydro storage systems.

Guarani tribe

Context

Recently, protests by Guarani tribal people have erupted across Brazil as the country’s Chamber of Deputies approved a new land bill that will restrict the new recognition of ancestral land of indigenous people.

Key facts about the Guarani tribe:

1. The Guarani were one of the first peoples contacted after Europeans arrived in South America around 500 years ago.
2. In Brazil, there are today around 51,000 Guarani living in seven states, making them the country\’s most numerous tribes. Many others live in neighbouring Paraguay, Bolivia, and Argentina.
3. These people in Brazil are divided into three groups: Kaiowá, Ñandeva and M’byá,of which the largest is the Kaiowá which means ‘forest people’.
4. They are deeply spiritual people.

Most communities have a prayer house, and a religious leader, whose authority is based on prestige rather than formal power

Lightweight and portable payment system

Context

The Reserve Bank of India (RBI) is developing a lightweight and portable payment system designed to operate during catastrophic events.

About Lightweight and portable payment system:

1. The RBI has conceptualized this system which it is calling a bunker which is an equivalent of digital paymentsthat can be operated from anywhere by a bare minimum staff in exigencies such as natural calamities or war.
2. It is expected to operate on minimalistic hardware and softwareand would be made active only on a need basis.
3. The infrastructure for this system will be independent of the technologiesthat underlie the existing systems of payments such as UPI, NEFT, and RTGS.
4. The system is expected to process transactions that are critical to ensure the stability of the economy, including government and market-related transactions.
5. The existing conventional payment systems such as RTGS, NEFT, and UPIare designed to handle large volumes of transactions while ensuring sustained availability.
6. As a result, they are dependent on complex wired networks backed by advanced IT infrastructure.

What is NEFT?

1. The National Electronic Funds Transferis an electronic method of transferring money online.
2. It enables transferring funds from the account maintained with any bank to any other bank branch, provided the transaction is attempted between the banks that participate in the NEFT payment system.
3. The payments made via NEFT are processed and settled half hourly batches and transactions can be performed 24*7.
4. Minimum Transfer Value: Rs. 1
5. Maximum transfer value: No limit
6. Money transfer made through NEFT does not require any additional transaction costs.

What is RTGS?

1. It stands for Real-time Gross Settlement, which is a payment mode where the money is transferred from one bank account to the other in real time, without any delay.
2. It is mostly used for transactions of high value.
3. When using the banking method, RTGS is the fastest possible way to transfer money.
4. Transactions made through RTGS are processed on a one-to-one basis and transactions can be performed 24*7.
5. Minimum Transfer Value: 2 lakh

Maximum transfer value: No upper limit is there, but can vary between banks.

Khorramshahr- 4 Ballistic Missile

Context

Iran unveiled a new Liquid-Fuel Ballistic Missile named “Khorramshahr-4” with a range of 2,000 Kilometers.

About Khorramshahr-4 Ballistic Missile:

1. The Khorramshahr has the heaviest payload of Iran’s ballistic missile fleet.
2. The Khorramshahr-4 is named after an Iranian city that was the scene of heavy fighting during theIran-Iraq War in the 1980s.
3. Khorramshahr-4 Missile has a 2,000-kilometre range and can carry 1,500-kilogram warhead.
4. The Khorramshahr-4 missile has a navigational aid system and can transport a large warhead.
5. According to official accounts, the enemy’s defense systems cannot detect, intercept, or take action to destroy the warhead due to its fast speed when it strikes the target.
6. This missile is the most recent iteration of the Khorramshahr family of point-blank missiles, which do not require final-stage guidance.

The ability to target precisely when in mid-flight (above the atmosphere) distinguishes this missile from its earlier iterations.