{"id":5139,"date":"2023-06-13T14:24:00","date_gmt":"2023-06-13T14:24:00","guid":{"rendered":"https:\/\/zeus.firm.in\/proposed-indian-carbon-market-framework-buy-and-sell-carbon-credits\/"},"modified":"2023-06-13T14:24:00","modified_gmt":"2023-06-13T14:24:00","slug":"proposed-indian-carbon-market-framework-buy-and-sell-carbon-credits","status":"publish","type":"post","link":"https:\/\/zeus.firm.in\/proposed-indian-carbon-market-framework-buy-and-sell-carbon-credits\/","title":{"rendered":"Proposed Indian Carbon Market Framework: Buy and Sell Carbon Credits"},"content":{"rendered":"

Proposed Indian Carbon Market Framework: Buy and Sell Carbon Credits<\/a><\/h3>\n

Author: Jayshree Navin Chandra, Senior Partner, and\u00a0Nitika Bakshi, Associate at ZEUS Law<\/strong><\/p>\n

Published in https:\/\/www.asiancommunitynews.com<\/a> on 12th<\/sup> June 16, 2023<\/p>\n

India, as a developing nation, has been at the forefront of climate action and has set an ambitious Nationally Determined Contribution (NDC) goal of reducing the emissions intensity of the GDP by 45% by 2030 against 2005 levels. In its endeavor towards a greener and more sustainable future, the government of India is planning to develop the Indian Carbon Market (ICM) to decarbonize the Indian economy through the trading of carbon credit certificates.<\/p>\n

Carbon markets are trading systems in which carbon credits are bought and sold. Entities may compensate for their green-house gas (GHG) emissions by purchasing carbon credits from entities that remove or reduce GHG emissions. Carbon finance is expected to be the key for implementation of NDCs and the Paris Agreement enables the use of such market mechanisms to aid countries in achieving their NDC goals.<\/p>\n

India currently has an energy savings-based market mechanism wherein energy savings certificates are issued to designated consumers whose energy consumption is less than the prescribed norms, and designated consumers whose energy consumption is more than the prescribed norms and standards shall be entitled to purchase the energy savings certificate to comply with the prescribed norms and standards. With the enactment of the Energy Conservation (Amendment) Act, 2022 the government has been empowered to specify a carbon trading scheme. As per the Energy Conservation (Amendment) Act, 2022 the Central Government, or any agency authorized by it, may issue carbon credit certificate to the registered entity which complies with the requirements of the carbon credit trading scheme and such entity is entitled to purchase or sell the carbon credit certificate in accordance such scheme. The Bureau of Energy Efficiency, Ministry of Power along with the Ministry of Environment, Forest and Climate Change are developing and finalizing the Carbon Credit Trading Scheme. Recently, a draft of the Carbon Credit Trading Scheme was circulated by the Ministry of Power to various industry bodies for comments and stakeholder consultation was organized.<\/p>\n

The scheme envisages the development of a compliance mechanism under which obligated entities shall comply with the prescribed GHG emission norms which will be developed and aligned with India\u2019s emissions trajectory as per climate goals, and a voluntary mechanism where non-obligated entities can register their projects for GHG emission reduction or removal for issuance of carbon credit certificates. It is proposed that each carbon certificate issued will represent reduction or removal of one ton of CO2 equivalent (tCO2e). Projects that may be eligible to earn carbon credits include waste handling and disposal, afforestation and reforestation, cattle management, transportation, renewable energy, energy efficiency projects and industrial energy efficiency and emission reduction projects.<\/p>\n

The draft Carbon Credit Trading Scheme proposes to set up a comprehensive institutional and governance structure for the execution of the ICM, which includes the following:<\/p>\n