India To Set For Carbon Emission Reduction Targets

India, as a significant step, plans for carbon emission reduction targets for four fossil fuel dependent sectors, and start a carbon trading market in 2025, Reuters reported. Government officials told the news agency that this move intends to align its greenhouse gas emission reduction targets. India is committed to reduce greenhouse emissions intensity of its GDP by 45 percent by 2030, from 2005 level.

The country will set the emission intensity specification and reduction targets for three years. The four sectors in this regard are petrochemicals, iron and steel, cement, and pulp and paper. Furthermore, these four sectors will be the first to trade carbon credits in the trade market which will enable them to buy and sell carbon credits to meet their needs.

“The mandates will be applicable from 2024-25 and the (carbon) trade will start in 2025-26,” a top government official told Reuters.

However, India”s ministries of environment and power did not respond to queries from Reuters.

The Energy Conservation Amendment legislation passed by the Parliament in last December proposes the creation of carbon markets. The proposed market is different from those in developed countries because in the latter, markets first fixes a limit on emissions and then allocate tradable permits, or credits, to emitter industries.

The targets for each sector”s emission reduction will be set by a committee consisting key ministries – environment, power and renewable energy. India already has a market for trading certificates in above-target energy savings for entities in 13 sectors.

“The rules and targets for the industries are likely to be announced before December,” the two officials told Reuters.

In October, Green energy companies formed a group to act as a mediator between the government and industry. They comprise Adani Green, owned by billionaire Gautam Adani, Hero Future Energies, Ayana Renewable Power and global private equity major KKR”s Virescent Infra.