Mainstreaming of Adaptation by industries to build climate resilience

CII work on Climate Change with its Members

• CII is the oldest industry association in India and has strong direct members of 8000 and indirect members of more than 20000

• CII has a National Climate Change Council headed by Mr Jamshyd Godrej and looks after various work avenues on climate change

• CII has been actively working with its members for improving industry energy efficiency under PAT cycle, encouraging more buildings to become green, water management through its WATSCAN tool, improving Climate Action through CAP 2.0 degrees program

• CII has been actively engaging with implementing many voluntary systems on climate change over the last decade

CAPitalising Excellence in Climate ActionA recognition and capability enhancementprogramme for Indian businesses to become climateresilient. Based on a CII climate-maturity model andusing the principles of business excellenceframework, CAP 2.0° helps businesses to contractclimate risks and explore market opportunities.

Meet threshold Meet threshold Meet threshold

Interested businesses

undergo self-

assessment

Businesses apply

for awards Desk assessment

of applications

Site

assessment of

applications Winner

announcement of the

Awards Ceremony

Gap Analysis feedback to

businesses who do not meet

threshold

Feedback report to

assessed businesses who

do not meet threshold

Feedback report to

assessed businesses who

do not meet threshold

Feedback report

to assessed

businesses

Economic Implications of Climate Change Impacts

• The Global Climate Risk Index (2018) reports the economic impact of climate-change related extreme weather events in India at purchasing power parity as:

• Losses in 2016: USD 21.5 million, equivalent to a loss of 0.2469% per unit of GDP.

• Average annual loss between 1997-2016: USD 12.7 million; equivalent to a loss of 0.2725% per unit of GDP.

• The report also ranked India as the sixth most vulnerable country in the world in 2016 to socio-economic impacts of climate-change related extreme events.

• The report only focuses on the impacts of extreme weather events, other impacts not taken into account.

• A recent estimate of economic losses from temperature and precipitation changes are presented in World Bank’s 2018 South Asia’s Hotspots report.

• The report states India stands to lose 2.8% of GDP by 2050 under a carbon intensive or business as usual scenario (RCP 8.5).

• India’s GDP loss reduces from 2.8% to 2% by 2050, if global emission mitigation efforts in line with the Paris Agreement are undertaken (climate sensitive scenario or RCP 4.5),

Economic Implications

• The report also identifies regional “hotspots” depending on severity of impacts (see figure on the right).

• The estimated GDP impact by 2050 in each type of hotspot in India is indicated in the table below:

Economic Implications

• Another commonly employed metric to estimate expected economic damages from carbon dioxide emissions is the “Social Cost of Carbon (SCC)”.

• SCC is defined as the economic damages in a given year associated with one metric ton increase in carbon dioxide (CO2) emissions.

• A September 2018 study by Nature Climate Change Journal calculated country-level SCC values.

• India was found to have the world’s highest SCC at $86 per ton of CO2, implying the cost of each additional ton of global CO2 emissions to the Indian economy would be around $86.

Climate Change Risks for Industry: Risk Types

Climate Change Risks

Physical

Damage inflicted on infrastructure and other assets,such as factories and supply-chain operations, by theincreased frequency and intensity of extreme weatherevents.

Acute: Event driven, e.g. cyclones,hurricanes, or floods.

Chronic: Longer-term shifts in climatepatterns (e.g., sustained highertemperatures) that may cause sealevel rise or chronic heat waves.

Transitional

Risks that may occur while transitioning to a lower-carbon economy

Regulatory, Policy and Legal: Changes inregulations and policy actions prompted byclimate change.

Technology: Changes or improvementsrequired for low-carbon transition, e.g. energyefficiency.

Market: Changes in demand and supply due toclimate change including raw material supply.

Reputation: Changing customer or communityperceptions of an organization’s operations inthe context of climate change.

Examples of Key Risks

Potential Financial Impacts of Risks: Examples

Adaptation: Role of Industry

Outline of a Voluntary Adaptation Framework

Develop a generic framework for business climate adaptation applicable to India featuring cluster approach for physical risks and sectoral approach for transitional risks

Provide understanding of climate zones in India and an analysis of the possible impacts in those zones.

Companies joining the initiative may pledge to disclose their business risks of climate change as well as the their plans and progress to overcome the identified risks. The initiative will report on their progress.

Companies that pledge to participate in climate adaptation will have benefits like global recognition on their works, platform to showcase their adaptation actions, etc.

Thank You