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April 08, 2014

How Coal & Clean Energy Will Define Indian Elections

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On the coast of India’s Gulf of Kutch in Western Gujarat, near a small town called Mundra, an iconic fight against Tata Power’s Mundra coal plant is brewing. This fight has become the epicenter of a “rousing struggle” against coal expansion - and a microcosm of India’s election politics.

A small group of local fisherfolk are opposing the plant and leading a campaign that exposes the dark side of unchecked coal development and contradictions in the campaign of leading Prime Ministerial candidate Narendra Modi.

In a country that recently made headlines for the largest power outage in history, Gujarat is an anomaly – it has a power surplus. That, along with industry-friendly policies including a heavy emphasis on special economic zones (SEZs), has helped propel the state's Chief Minister, Narendra Modi, to become the primary challenger in the race for prime minister. Indeed, the idea Modi's campaign has touted about Gujarat energy development is something many Indians aspire to.

Even more appealing is that Modi's power surplus has been supported by a 'saffron revolution' thanks to dramatic solar expansion. A true anomaly in coal-dependent India.

But despite Modi’s fervent support for solar energy, Gujarat is also home to some of the biggest coal plants in the country. Power companies are building a series of 16 ultra mega coal power plants (UMPPs) to stem the power crisis, including Tata Power’s flagship Mundra coal plant, or “Tata Mundra.” But the projects have exposed just how poorly the industry is now performing, and just how desperate the need is to diversify India’s energy mix away from coal.

Tata Mundra has been a debacle since day one. Despite abundant promises of cheap power, Tata Mundra’s costs have skyrocketed, forcing it to raise rates for average citizens. Worse, it has set a harmful precedent in the country: it’s the first project to be exempt from a legally binding contract by the Central Electricity Regulatory Commission in order to raise rates and boost profits. Tata Mundra will be defending the exemptions in courts for years to come as states and consumers appeal these decisions.

The devastation to locals from this project is even more grim. Tata Mundra has burdened local fishermen by diverting waterways and releasing thermal pollution that kills fish for miles along the coast.

That’s why local fisherman have filed for a full audit of the World Bank Group’s financing of the project. The audit’s damning findings were swept under the rug by World Bank President Dr. Kim, but are once again under investigation by another international financier -- the Asian Development Bank.

Rampant, unchecked industrialization is ravaging the environment and the social fabric of India’s coasts, and Modi’s political enemies know it. Arvind Kejriwal, chief of an opposing political party, traveled to Gujarat to “tour" the development progress of the state.

While Gujarat has seen large industrial growth, it’s also home to some of the lowest social indicators in the country. In fact, Gujarat represents one of the lowest per-capita, per-day earnings for salaried people in the country. Most Indians don’t see these facts, thanks to Modi’s impressive marketing campaign.  

But it’s not just opposing political parties who are highlighting the contradictions inherent in Modi’s state and campaign. Already the Congress party has organized several political rallies up and down Gujarat’s heavily industrialized coastline to appeal to fishing communities affected by coal development. The message: end environmental destruction.

Modi’s association with some of the world’s largest coal projects will undoubtedly darken the candidate’s image. It may even put him in the same company as India’s current Environment Minister “Oily Moily.”

As Indians head to the polls, what’s happening in Mundra could end up ultimately defining Modi and his plan for the nation.

--Justin Guay, Associate Director, Sierra Club International Climate Program

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