On April 16, 2025, the Ministry of Environment, Forest and Climate Change (MoEFCC) took a bold step toward operationalizing India’s domestic Carbon Credit Trading Scheme (CCTS) by publishing official Greenhouse Gas Emission Intensity (GEI) Targets for designated industrial units across sectors like Aluminium, Cement, Chlor- Alkali, Pulp & Paper and White Cement.

What’s Happening?

Under the Energy Conservation (Amendment) Act, 2001 and the Carbon Credit Trading Scheme (2023), the GEI targets aim to reduce the tCO₂e per unit of product for over 140 major industrial facilities across India.

The objective?

Create a market-based incentive to decarbonize through tradable carbon credits.

Who’s Involved?

Designated entities from energy-intensive sectors such as:

  • Aluminium
  • Cement
  • White Cement and Refineries
  • Chlor- Alkali,
  • Pulp & Paper

How Does It Work?

Each entity has been assigned GEI reduction targets for the compliance years 2025-26 and 2026-27, based on their 2023-24 baselines.
Failing to meet targets? Entities must purchase carbon credits from the Indian Carbon Market (ICM).
Exceeding targets? Bankable credits are issued by BEE that can be traded or carried forward.

 Why This Matters:

  • Aligns industrial decarbonization with India’s Nationally Determined Contributions (NDCs).
  • Creates financial value for emission reductions.
  • Promotes adoption of clean technologies.

 Key Mechanism Highlights:

  • Sector-specific emission factors and baseline data-driven targets.
  • Each obligated entity must: (a) meet its GEI target as per the Schedule; (b) purchase carbon credits from the Indian Carbon Market if targets aren’t met; (c) submit banked or purchased credits to cover any shortfall; (d) register on the ICM Portal; and (e) submit all required documents through the Portal as per the Bureau’s guidelines.
  • be liable to pay penalty, in case of non-compliance, against the shortfall in the respective

This move is a major regulatory milestone and a clear sign that India is serious about carbon pricing and driving private sector participation in the low-carbon transition.

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