Page 128 - CW E-Magazine (29-4-2025)

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POSITIVE IMPACT

‘India’s new carbon market methodologies set

to boost carbon offset landscape’

India’s recent approval of eight
methodologies for its domestic volun- India’s carbon offset portfolio
tary carbon market is set to revitalises
national carbon offset landscape, ac-
cording to Wood Mackenzie, a global
provider of data and analytics for
energy transition. “The Carbon Credit
Trading Scheme (CCTS) introduces
a framework that could signifi cantly
impact carbon credit prices, quality,
and trading patterns in the country,” it
stated.

Ms. Fernanda Abarzúa, senior
research analyst, carbon at Wood Source: Wood Mackenzie Lens Carbon
Mackenzie, said, “India’s new metho- ration opportunities in non-obligat- crucial in determining the trajectory
dologies could potentially boost the ed sectors, facilitating mitigation of offset prices in India”.
quality and credibility of its carbon from sectors not covered under the
offsets. This move may lead to an up- compliance regime. Mr. Shashank The new methodologies cover key
ward pressure on prices, narrowing Atreya, senior research analyst, sectors including energy, industry,
the gap with neighbouring countries.” carbon markets at Wood Mackenzie waste management, forestry, and agri-
Wood Mackenzie has highlighted that said, “By providing a structured culture. This comprehensive approach
India plays a signifi cant role in the process to seek quality accreditation could lead to a more diverse offset port-
global voluntary carbon market, with from the regulator, we are likely to folio, potentially infl uencing project
more than 5,000 projects registered see an increased domestic and foreign development trends in the country.
across four major registries: the Clean investment in Indian carbon Wood Mackenzie’s analysis suggests
Development Mechanism (CDM), reduction projects. The CCTS regu- that the decision to formalise these
the Verifi ed Carbon Standard (VCS), lations have yet to clarify if offset- methodologies will build trust in Indian
the Gold Standard Registry (GSR), generated CCCs can be used for offsets, potentially improving their
and the Universal Carbon Registry compliance. This decision will be quality and infl uencing prices.
(UCR).
‘Indian economy to surpass
In Q1 2024, India’s average car-
bon credit price of $2.35 per tonne of Germany and Japan in three years’
CO was signifi cantly lower than its
2
South Asian counterparts at: Sri Lanka The Indian economy will be bigger
($3.77), Bangladesh ($4.45), and than Germany and Japan in the next
Pakistan ($28.11). The CCTS allows for three years, and it could also become
international trading of Carbon Credit the second largest economy by 2047,
Certifi cates (CCCs) under Article 6.2 according to NITI Aayog CEO, Mr. B.
of the Paris Agreement. This provision V. R. Subrahmanyam. According to the
could increase India’s role in the global latest IMF data, size of India economy
carbon market. currently stands at $4.3-trillion.
companies to aspire to become world
India has also opened credit gene- Mr. Subrahmanyam urged Indian leaders.

128 Chemical Weekly April 29, 2025

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