Green Credit Programme and India's Net Zero Transition: From Intent to Action
India's Net Zero transition has reached a crucial juncture with the announcement of the introduction of the Green Credit Programme (GCP) and the formation of India's domestic regulated carbon market. Led by the Ministry of Environment, Forest and Climate Change (MoEFCC) and the Ministry of Power (MoP), these initiatives represent significant steps towards sustainable practices and addressing environmental challenges, in line with Mission LiFE, which promotes an environmentally conscious lifestyle.
The Green Credit Programme offers individuals, companies, and local bodies the opportunity to earn "green credits" for their contributions to sustainable activities such as tree plantation, water conservation, and waste management. Simultaneously, the domestic regulated carbon market provides a platform for trading carbon credit certificates.
Certain considerations
As India embarks on this transformative journey, several considerations warrant attention to ensure the success of the GCP and the carbon market. These considerations include:
Market Structure: Establishing a unified market structure with standardized carbon credit certificates will simplify trading and promote transparency.
Pricing Mechanism: Aligning pricing with international benchmarks will attract active participation and enhance competitiveness.
Sectoral GHG Emission Targets: Prioritizing sectors for emission reduction efforts will guide sustainability goals and align with overall objectives.
Derivatives Trading Instruments: Exploring carbon credit derivatives trading instruments can enhance market liquidity and participation.
Interplay between GCP and Compliance Market: Clarifying whether GCP credits can offset emissions in the compliance market and establishing conversion formulas will ensure seamless integration.
The impact
The impact of these two initiatives will be significant. Organizations will face increased pressure to measure and report their GHG emissions, driving transparency and accountability.
Incentivizing air pollution reduction will encourage corporations to reduce emissions from employee commute and business travel, improving air quality and public health. Sustainable agriculture-based green credits will promote organic farming practices and provide additional income for farmers.
Additionally, the Green Credit Programme will catalyze investments in green projects that generate carbon credits, fostering sustainable development and contributing to emission reductions.
Greenwashing concerns and solutions
Addressing concerns around greenwashing is crucial to ensure the credibility and effectiveness of sustainability efforts. To combat false or exaggerated claims of environmental sustainability, it is essential to establish mechanisms and devise strategies that promote transparency and authenticity.
One effective approach is to collaborate with credible organizations that specialize in sustainability solutions. When selecting partners, evaluating their services, solutions, and current partnerships helps establish their credibility and commitment to sustainability. By leveraging the expertise and resources of these organizations, the Green Credit Programme can ensure that participants are genuinely contributing to environmental sustainability.
In addition, creating sufficient demand for genuine green credits is essential. Through comprehensive outreach strategies, the Green Credit Programme can raise awareness among potential credit buyers, increasing the demand for verified and reliable green credits. This emphasis on creating a viable market ensures that green credits are valued and recognized as genuine indicators of sustainable actions.
Furthermore, the adoption of reliable systems and technologically driven methodologies for sustainability reporting is crucial. Once again, responsible organizations in sustainability businesses will lead the way. By implementing robust monitoring and verification processes, the Green Credit Programme can ensure transparency and drive meaningful change. These systems serve as a foundation for accurate reporting and help combat greenwashing by providing transparent and auditable data.
Authored by Anup Garg, Founder and Director, World of Circular Economy (WOCE)
