India to craft carbon credit trading scheme
This will support the country’s goal to cut emission intensity.
The Indian government is developing the Indian Carbon Market (ICM) that is anchored on the creation of a carbon credit trading scheme to decarbonise the country, led by the Bureau of Energy Efficiency (BEE), Ministry of Power, and the Ministry of Environment, Forest & Climate Change.
In a statement, the power ministry said the scheme will boost energy transition moves by increasing the scope and developing greenhouse gas emissions intensity benchmarks and targets for the potential energy sectors in the country.
“The ICM will enable the creation of a competitive market that can provide incentives to climate actors to adopt low-cost options by attracting technology and finance towards sustainable projects that generate carbon credits,” said BEE Director General Shri Abhay Bakre.
READ MORE: Renewable energy use may become mandatory for some Indian sectors
“It can be a vehicle for mobilizing a significant portion of investments required by Indian economy to transition toward low-carbon pathways,” he added.
This scheme will support India reach its goal of reducing its GDP emissions intensity by 45% by 2030 against 2005 levels.
The ministry said that carbon credit trading will be based on the performance against the sectoral trajectories. A voluntary mechanism will also be developed to encourage the non-obliged sectors to reduce their emissions.
The ICM will establish the methodologies to estimate carbon emissions reductions and operationalise the program, amongst others whilst monitoring, reporting, and verification guidelines for the scheme will be developed after consultation.
It will also provide new mitigation opportunities through demand for emission credits by private and public entities, the ministry said.