Carbon Credit Market Scheme 2023

CARBON CREDIT MARKET SCHEME 2023
The ministry approved the establishment of India's first domestically regulated carbon market on
June 28, 2023, through a gazette notification. Officially known as the Carbon Credit Market
Scheme, the market will help the country's carbon credit trading. A National Steering Committee
must be established as part of the plan in order to oversee and coordinate the operation of the
Indian carbon market.
The National Steering Committee (NSC) will be in responsible for formulating and finalising
recommendations for institutionalising the Indian carbon market, setting specific greenhouse gas
emission targets for obliged parties, establishing rules for the trading of carbon credit certificates
outside of India, and issuing carbon credit certificates. It will also take part in creating the
circumstances or processes.
This particular notification of ministry of power contains 13 sections, with some relevant
definition, formation and functions of National Steering Committee, Bureau and its functions etc.
A precise summary of the notification is given below:-
 Section 2 Definitions: The document provides definitions for terms used in the
framework, including "Accredited Carbon Verifier," "Compliance Mechanism," “Indian
Carbon Market Framework” among others.
 Section 2 (b): Accredited Carbon Verifier’ means an agency accredited by the Bureau to
carry out validation or verification activities in respect of the Carbon Credit Trading
Scheme.
 Section 2 (g): Compliance Mechanism – A mechanism under the Carbon Credit Trading
Scheme under which the obligated entities shall comply with the prescribed Green House
Gases emission norms as may be notified by the Central Government
 Section 2 (i): Indian Carbon Market Framework – means a national framework
established with an objective to decarbonize the Indian economy by pricing the Green
House Gases emission through trading of the Carbon Credit Certificates.
 Section 3 and Section 4: National Steering Committee and its Functions respectively – A
"National Steering Committee for the Indian Carbon Market" would be established,
according to the notification, to direct and coordinate the market's operations. Ex-officio
chairperson will be the secretary of the ministry of power, with the secretary of the
ministry of the environment, forests, and climate change serving as co-chairperson. The
group will also include representatives from the departments of finance, new and
renewable energy, steel, coal, and petroleum, as well as Niti Aayog. The steering
committee will provide recommendations to the Bureau of Energy Efficiency for the
creation and completion of protocols for the institutionalisation of the Indian carbon
market and the creation of greenhouse gas emission objectives for "obligated entities."
 Section 5: Bureau and its functions – Under this notification, the Bureau, as the
administrator of the Indian Carbon Market, will select industries with the potential to
reduce greenhouse gas emissions and recommend to the ministry their inclusion in the
market. Based on the NSC's recommendation and subsequent approval by the central
government, the Bureau will also set a trajectory and targets for the entities covered by
the compliance mechanism and issue certificates for carbon credits.
 Section 6: Registry and its functions – It will be responsible for the fulfilling various
functions as per the bureau’s directions. It includes registering obligated or non-obligated
entities, to maintain a secure database with the necessary protocols etc.
 Section 7: Commission as Regulator for Trading Activities – The regulator will be the
Central Electricity Rugulatory Commission. This organization will be in charge of
regulating CCC trade, ensuring that the interests of both vendors and buyers are
safeguarded.
 Section 8: Technical Committee and its Function – To address the many areas covered by
the program's compliance process, a specialised technical committee was constituted as
needed. It will be led by a member with the necessary qualifications and sector-specific
experience.
 Section 13: Power to issue directions – With the central government's aprroval, the
bureau may occasionally issue any instructions or directives to registered entities that it
deems necessary for the operation of this programme.
In conclusion, the framework outlined in the content establishes the Indian Carbon Market (ICM)
and the Carbon Credit Trading Scheme. It provides definitions, sets up governing bodies such as
the NSC, designates the Bureau as the Administrator, and assigns roles to entities like the
Registry, Regulator. The framework covers both the Compliance Mechanism for obligated
entities and the Voluntary Mechanism for non-obligated entities. Detailed procedures are
developed for various aspects of the Indian Carbon Market, ensuring transparency and effective
implementation. With this framework in place, India aims to decarbonize its economy by pricing
greenhouse gas emissions and promoting emission reduction projects. The ICM offers
opportunities for entities to participate in carbon credit trading and contribute to mitigating
climate change.

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CARBON CREDIT MARKET SCHEME 2023

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