Green credits can also be traded in the carbon market if they additionally help in carbon emissions reduction or removal. (Photo Credit Wikimedia Commons)
The Indian government has decided to go ahead and institute a domestic voluntary carbon market mechanism and has released the draft Green Credit Programme Implementation Rules 2023 for public comments. The Green Credit Programme (GCP) envisages that any entity, from individuals, farmer producer organisations (FPOs) and cooperatives to industries, and urban and rural local bodies, who undertake any of the listed eight activities such as tree plantation, water conservation, sustainable agriculture, waste management, air pollution reduction, mangrove conservation, eco-mark labelling and sustainable buildings can earn green credits.
Each green credit will have a monetary value assigned. The green credits generated from such activities will be made available for trading on a domestic market platform after a steering committee has validated them. Green credits can also be traded in the carbon market if they additionally help in carbon emissions reduction or removal. The Indian Council of Forestry Research and Education will administer the programme, while a yet-to-be-established steering committee will have the power to grant approvals on issues such as monitoring, reporting, and verification.
No New Activities
Not surprisingly, the first list of activities under the GCP raises more questions than enthusiasm. The big question is why duplicate activities like afforestation, water conservation, sustainable agriculture and others that are already in the domain of various government programmes and also being delivered as part of the many corporate social responsibility (CSR) initiatives under Business Responsibility and Sustainability Reporting as mandated by the Securities and Exchange Board of India. Industry observers cite examples of excellent initiatives such as Project Hariyali of Mahindra, sustainable agroforestry model of ITC Ltd, afforestation projects of NTPC Ltd, water conservation programme by the Tamil Nadu government, mangrove restoration initiatives of the forest department and so on.
If the intention is to lure more companies with market incentives to engage in green activities, then it is important to recall India’s previous failed attempt to incentivise via market measures. A similar carbon market experiment called Perform Achieve and Trade (PAT) scheme of the Bureau of Energy Efficiency using energy savings certificates failed