A list of 10 sectors was approved for the Offset Mechanism under the Carbon Credits Trading Scheme (CCTS).
- Out of these, six sectors belong to Phase 1, for which 12 methodologies have been developed.
- The methodologies have been adapted from the existing UNFCCC Clean Development Mechanism (CDM) methodologies.
- Under the CDM, emission-reduction projects in developing countries can earn certified emission reduction credits.
- These saleable credits can be used by industrialized countries to meet a part of their emission reduction targets under the Kyoto Protocol.
- These methodologies cover a range of sectors (given in the table below).
Sectors | Methodology |
Energy | Grid-connected electricity generation from renewable sources Projects. |
Industry | Energy efficiency and fuel switching measures for industrial facilities Projects. |
Waste handling and disposal | Landfill methane recovery Projects. |
Agriculture | Production of biofuel, Methane recovery from livestock and manure management at households and small farms. |
Forestry | Afforestation and reforestation of lands except wetlands Projects. |
Transport | Modal shift in transportation of cargo from road transportation to water or rail transportation, electric and hybrid vehicles. |
Carbon Credits Trading Scheme (CCTS), 2023
Introduced through amendments in the Energy Conservation (Amendment) Act, 2022, it establishes Indian Carbon Market under two mechanisms:
- Compliance mechanism: Mandatory program where the Government will set GHG emission intensity targets for obligated entities.
- Initially includes 9 sectors like Fertiliser, Iron & Steel, Pulp & Paper, Petrochemicals, Petroleum refinery, etc.
- Offset mechanism: A voluntary project-based mechanism for non-obligated entities (not covered under compliance mechanism).
- Non-obligated entities can register their projects and earn Carbon Credit Certificates (CCCs) once they meet eligibility requirements outlined by the BEE.