The Indian government has released a list of projects eligible to earn and sell carbon offsets in international carbon markets.
A total of 13 activities have been determined to be potential carbon offset generators in the country, according to a press release published by the Ministry of Environment, Forests, and Climate Change.
The National Designated Authority announced the activities for Paris Agreement Implementation (NDAIAPA).
Major energy and emission-intensive industries are covered
Offshore wind power, green hydrogen, renewable energy storage, energy efficiency, sustainable aviation fuel, solar thermal energy, biogas, green ammonia, and carbon capture, utilization, and storage are some of the technologies that may be used to produce offsets that can be traded across jurisdictions.
The NDAIAPA has approved these activities for three years.
India recently passed legislation to establish a national carbon market. According to media reports, a voluntary carbon market could be debuted later this year.
It will be gradually expanded and mandatory to cover all major energy- and emission-intensive industries.
As permitted by Article 6 of the Paris Agreement, India has yet to sign any agreements linking its planned national carbon market to other national or sub-national carbon markets.
PAT exceeds its target of lowering energy consumption
According to media reports citing government officials, the Perform Achieve Trade (PAT) scheme would be converted into a carbon market. The PAT scheme, launched in July 2012, is based on a cap-and-trade framework but is focused on energy efficiency.
According to the government, PAT exceeded its targets and decreased its energy consumption by 5.3% compared to the target of 4.1% during its first operational phase from 2012 to 2015.
Current and future schemes are part of India’s strategy to meet its commitments by 2030.
India declared its Intended Nationally Determined Contribution (NDC) to the UN Framework Convention on Climate Change in 2015. (UNFCCC).
It committed to increasing non-fossil fuel-based power generation capacity to 40% and lowering GDP emissions intensity to 33-35% of 2005 levels.
In August 2022, India submitted an update to these commitments, increasing the target share of non-fossil fuel power generation capacity to 50% and reducing emissions intensity to 45% below 2005 levels.
Carbon-reduction goals for major companies
Several countries have passed legislation establishing a domestic carbon market by Article 6 of the Paris Agreement.
Many have also signed bilateral agreements with countries with a high potential for reducing GHG emissions.
Some have signed contracts with voluntary carbon market registries to gain access to carbon offsets for domestic industries. India has yet to do either of these things.
Several prominent Indian corporations have announced carbon-reduction targets and may have some experience participating in a carbon market. Companies already part of the PAT scheme will be familiar with the general framework.
Indian companies have extensive seller experience, having previously been the second biggest supplier of Certified Emission Reductions, or CERs, under the UNFCCC’s Clean Development Mechanism.
This experience, combined with lessons learned from the PAT scheme, will make it simpler for the Indian government and corporations to prepare for a national carbon market with international connections.
