Infra Green February 2008

Pioneering GREEN INFRASTRUCTURE

InfraGreen 08 Hari Sankaran MD, IL&FS

INDIA AT A CROSSROAD • Infrastructure investment key to supporting India’s 9% p.a. growth trajectory • We have a choice between “Business as Usual” vs. “Going Green” • The benefits are evident – – – – –

Better health Cleaner environment Less Green House Gas Emissions Energy Efficiency Greater Energy Security

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GREEN INFRASTRUCTURE

TURNING BROWN TO GREEN

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Existing Scenario • 42 Million tons MSW generated per annum in Indian cities • Open dumping a common practice, no scientific closure of landfills – public health menace, GHG emissions • Negligible work on waste management including waste minimization, its reuse & recycling

Composting

IL&FS has initiated the process of composting from MSW in Delhi, Punjab, Rajasthan and Tamil Nadu.

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Waste to Energy

IL&FS is developing waste to energy projects from MSW in Delhi.

Scientific Management of Dumpsites Creation of space for future operation – – – –

Shifting of Existing waste Capping Leachate and Methane Capture Landscaping

After Shifting and Capping IL&FS is assisting MCGM (Mumbai) to close 3 existing dumpsites at Gorai, Mulund and Deonar and reclaim 80 hectares of green landscaped space.

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Green Benefits of Processing MSW • Clean up the urban landscape • Saving on precious land • Provide organic compost to mitigate excessive use of chemical fertilizer in the agricultural sector • Mitigate GHG gas emissions • Improved health and hygiene

The Opportunities • Given the large number of infrastructure projects to be built, we have a unique opportunity to build green infrastructure – An example is the Gujarat International Finance and Tech-City (GIFT) that IL&FS is developing as a green city with energy efficient buildings, green belts and green open spaces.

• Propel key sectors on a low-carbon growth plan – An example is the energy sector

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GIFT: Green City • Massive green areas across the city: 60-65% to be under green cover • Integrated Waste Management systems • Promotion of public transportation for reduction of harmful carbon emissions • Innovative District Cooling system • Using ecologically sound building materials

GIFT City

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GLOBAL CHALLENGES Water and waste management Urbanization

Building Green Cities Public Transport

Energy Security

Energy contributes 80% of GHG emissions. Energy Security key to economic growth. •Renewable Energy •Energy Efficiency Need for mitigation measures to reduce impact of increasing GHG gases.

Climate Change

Carbon credits to incentivize green infra

Green Power Options • Renewable Energy an answer to growing power needs of Industry – – – – – –

Hydro Wind Biomass Solar Geothermal Biofuel

• Energy Management – – – –

Municipal systems Industrial systems Building systems Distribution loss reduction systems

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Green Power – Energy Saving Investment Potential (Billion Rs)

Energy Savings (MWH)

Energy Savings (MW)

Industrial – Generic EE Measures

42.0

23.7 mn

3,400

Industrial - Process EE Measures

79.0

25.3 mn

3,600

Commercial

1.5

0.2 mn

56

Government

4.2

1.6 mn

500

Municipal

13.0

3.7 mn

1,688

Total

140.0

54.5 mn

9,244

Market Type

INCENTIVIZING FIRMS A key challenge is incentivizing firms to self select green over grey or brown –

Voluntary Tracking through Green Accounting

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Government Policies and Regulations

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Creating a Sustainability Index for rating firms

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Introducing PPP models for profitable green infrastructure projects that are sustainable

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Green Accounting - Why • Growing pressures on the environment with increasing environmental awareness • Developing appropriate economic, trade and sustainable development policies • A recognized need to provide more accurate information on progress towards sustainable development at the national level and the corporate level • Green or Environmental accounting - an effort to incorporate environmental benefits and costs into economic decision making.

Government Initiatives • JNNURM funding for Urban Infrastructure. • Nutrient based subsidy regime to improve soil productivity. – Complement chemical with organic fertilizer

• Selective tax and pricing incentives for green power – Wind Power (accelerated depreciation) – Solar and Biomass Power (higher tariffs)

• Electricity Act 2003 furthers open access and ability to supply to third parties encouraging PPPs in power generation, transmission, distribution and management

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Making it happen • Regulation and Policies – providing incentives to firms to go green • Development of new financial instruments and global funding sources - carbon finance • Carbon finance to fund green investments • New energy efficient technologies • Using Public Private Partnerships

Thank you.

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