Bharat made a bold move in 2024 by revamping its Carbon Credit Trading Scheme (CCTS), allowing non-obligated entities to participate in the tradable carbon credits market. That means companies and individuals can voluntarily use carbon credits to address their planet-warming emissions.
This significant revision introduces an offset mechanism, enabling these entities to register projects and obtain tradable carbon credit certificates (CCCs). Each credit represents one tonne of carbon dioxide equivalent (tCO2e). The aim is to efficiently price emissions through CCC trading and expand the voluntary carbon market.
In 2023, Bharat introduced the 2023 Carbon Credit Trading Scheme (CCTS), encompassing both compliance and voluntary sectors. However, while the compliance segment is scheduled to commence in 2025-26, there is no set timeline for the launch of the voluntary carbon market.
Under Bharat’s revised carbon market scheme, obligated entities have the flexibility to purchase additional credits or sell surplus ones. Meanwhile, businesses can trade CCCs to offset their emissions.
However, sectors facing challenges in meeting reduction targets, particularly those with hard-to-abate emissions, are exploring the possibility of trading energy-saving certificates (ESCerts) and renewable energy certificates (RECs) as offsets.
Bharat emerged as a favorable destination for energy transition investments after successfully hosting the G20 Summit last year. During the same year, the country added about 17 GW of capacity, with non-fossil additions accounting for 13.8 GW.
Moreover, Bharat increased its financial support to propel the green hydrogen ecosystem and initiated preparations for its domestic carbon markets.
Key decisions regarding international participation in the carbon credit market are expected in 2024, setting the trajectory for Bharat’s engagement. Additionally, discussions on the scope, design, and procedures of the scheme, including linkages with international standards and registries, are anticipated to be addressed.
Bharat’s move reflects its commitment to combating climate change and aligning with global efforts towards decarbonization. This year, the super-emitter is anticipated to intensify its efforts in implementing its energy transition strategy while navigating challenges related to energy security and affordability.
The strategy also underscores the importance of integrity measures in bridging the emissions reduction gap and achieving climate goals.
Bharat’s revised Carbon Credit Trading Scheme (CCTS) presents a significant step forward in the global effort towards decarbonization. This, combined with the strong growth observed in the global carbon trading market, underscores a promising trajectory towards reducing greenhouse gas emissions.
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