One project that popped up last year involved converting the operations of a platinum mining company in Bihar from burning coal to another burning another fossil fuel in a slightly-lower-emissions way. That’s easy to verify, and there was a clear argument for why it wouldn’t make economic sense for them to transition without the offset money
I am also confused about the general question, but I found this intervention interesting to think about. It seems like the legitimacy of this comes down to the elasticity of demand for coal in India (basically, if someone buys 1 ton less of coal, will someone else buy that same ton for a lower price, or will coal producers make one ton less?). I couldn’t find any data on elasticity of demand for coal in India, but this paper estimates it for China as 0.3 to 0.7, which is maybe an OK proxy? And I don’t know if it’s reasonable to model the elasticity of demand of coal and of the other fossil fuel as the same (eg, it would be terrible if not buying 1 ton of coal reduces the total coal by 0.2 tons produced, but buying 1 ton of oil increases total oil produced by 0.8 tons).
Overall it feels non-obvious to me whether it’s legit, though I lean towards “probably, but about half as effective as a naive calculation suggests”
I am also confused about the general question, but I found this intervention interesting to think about. It seems like the legitimacy of this comes down to the elasticity of demand for coal in India (basically, if someone buys 1 ton less of coal, will someone else buy that same ton for a lower price, or will coal producers make one ton less?). I couldn’t find any data on elasticity of demand for coal in India, but this paper estimates it for China as 0.3 to 0.7, which is maybe an OK proxy? And I don’t know if it’s reasonable to model the elasticity of demand of coal and of the other fossil fuel as the same (eg, it would be terrible if not buying 1 ton of coal reduces the total coal by 0.2 tons produced, but buying 1 ton of oil increases total oil produced by 0.8 tons).
Overall it feels non-obvious to me whether it’s legit, though I lean towards “probably, but about half as effective as a naive calculation suggests”