India · Intensity-based credit trading (preparing)

India: 490 plants have emission-intensity targets, but no carbon credit has traded yet

India's Carbon Credit Trading Scheme sets each plant a greenhouse gas intensity target per tonne of product. Plants that beat it earn tradable credits; plants that miss it must buy them. Targets now cover 490 entities, and the trading rules are in place, but trading is expected only from 2026-27.

South Mumbai skyline with sailing boats in the harbour
South Mumbai skyline with sailing boats in the harbour. Photo: iMahesh, CC BY-SA 4.0, source. Resized only; no other change.
Summary

In brief

The Carbon Credit Trading Scheme was notified on 28 June 2023. It sets each obligated plant a greenhouse gas emission intensity target in tCO2e per tonne of product, against a 2023-24 baseline, for the compliance years 2025-26 and 2026-27.

Targets cover 490 entities (the Press Information Bureau total of 22 January 2026): 282 in aluminium, cement, chlor-alkali and pulp & paper from October 2025, and 208 in refineries, petrochemicals, textiles and secondary aluminium from January 2026. A June 2026 draft would add 255 iron and steel entities.

A plant that misses its target must buy Carbon Credit Certificates (1 per tCO2e); otherwise it pays environmental compensation of twice the average traded price, within 90 days.

CERC's trading rules of 27 February 2026 set monthly trading on power exchanges within a floor and forbearance price band. No band and no trade had been published in the official texts we read as of 12 November 2026.

Data

Coverage in charts

There is no traded price yet, so the charts show who is covered and how large the targets are.

Obligated entities with notified targets (cumulative), with the draft steel step and the 795 estimate

Obligated entities02505007501,000Oct 2025Jan 2026Jun 2026 (draft)Estimated eventual coverage ~795282490745

Source: Press Information Bureau (MoEFCC); Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency; Ministry of Power. Checked 2026-11-12. Solid: notified targets. Dashed: 490 + 255 iron and steel entities if the 26 June 2026 draft is adopted (calculated). The line at 795 is the Ministry of Power's March 2025 estimate.

Table of the same figures
PeriodObligated entities
Oct 2025282
Jan 2026490
Jun 2026 (draft)745 (calc.)

Entities with targets, by sector

entities075150225300Iron & steel (draft)TextilesChlor-alkaliAluminiumSecondary aluminium3

Source: Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency. Checked 2026-11-12. Counted from the Schedules of the target rules; iron and steel is a draft.

Table of the same figures

One plant's targets: Vedanta Jharsuguda Smelter II (tCO2e per tonne of aluminium)

tCO2e per tonne051015202023-24 baseline2025-26 target2026-27 target13.887813.723213.2965

Source: Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency. Checked 2026-11-12. A 4.3% cut from the 2023-24 baseline by 2026-27 (calculated). The 2025-26 target is pro-rated for September 2025 to March 2026.

Table of the same figures

Emissions intensity of India's GDP, reduction from 2005 (%), and the 2030 goal

Reduction vs 2005012.52537.55020102014201620192030NDC goal: 45% by 203012212433

Source: Press Information Bureau (MoEFCC); Press Information Bureau (Ministry of Power). Checked 2026-11-12. The carbon market is one of the tools named for the 45% goal.

Table of the same figures
PeriodReduction vs 2005
201012
201421
201624
201933
2030—

Where the estimated 795 obligated entities are: top 5 states

entities037.575112.5150GujaratOdishaChhattisgarhRajasthanKarnataka10183767055

Source: Ministry of Power. Checked 2026-11-12. Ministry of Power estimate, March 2025.

Table of the same figures
PeriodentitiesSource (checked)
Gujarat101Ministry of Power 2026-11-12
Odisha83Ministry of Power 2026-11-12
Chhattisgarh76Ministry of Power 2026-11-12
Rajasthan70Ministry of Power 2026-11-12
Karnataka55Ministry of Power 2026-11-12
Chronology

Timeline

Red dates are still ahead.

From the 2022 law change to monthly trading

  • 2022-05-30India notifies its national authority for Article 6 of the Paris Agreement.
  • 2023-06-28Carbon Credit Trading Scheme, 2023 notified under the Energy Conservation Act.
  • 2023-12-19Scheme amended (S.O. 5369(E)).
  • 2024-07Compliance procedure and MRV framework published.
  • 2024-11-13CERC publishes draft trading regulations.
  • 2025-04-16Draft emission intensity target rules published.
  • 2025-08-07India and Japan sign a Joint Crediting Mechanism agreement under Article 6.2.
  • 2025-10-08First targets: 282 entities in aluminium, cement, chlor-alkali, pulp & paper.
  • 2026-01-13208 more entities added; total 490.
  • 2026-02-27CERC notifies the carbon credit trading regulations.
  • 2026-03-21Indian Carbon Market portal launched.
  • 2026-06-26Draft targets proposed for 255 iron and steel entities.
  • 2026-10BEE drafts the trading procedure: sessions on the last Thursday of each month.
  • 2027-03-31Compliance year 2026-27 ends — the last year with notified targets.

Source: Press Information Bureau (MoEFCC); Ministry of Power; Central Electricity Regulatory Commission (CERC); Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency; Press Information Bureau (Ministry of Power); Bureau of Energy Efficiency (BEE).

Mechanism

How it works

How a plant meets its target each compliance year.

How the compliance mechanism works

  1. Step 1

    Target set

    An annual intensity target per tonne of product, against a 2023-24 baseline, for a 3-year trajectory.

  2. Step 2

    Measure and verify

    Direct and purchased-energy emissions are reported and checked by an accredited verifier.

  3. Step 3

    Credits or shortfall

    (Target − achieved intensity) × output: beat it and receive credits, miss it and owe that many.

  4. Step 4

    Trade monthly

    Credits change hands on power exchanges; extra credits can be banked for later years.

  5. Step 5

    Penalty if short

    Environmental compensation of 2× the average traded price, payable within 90 days.

Source: Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency; Bureau of Energy Efficiency (BEE); Central Electricity Regulatory Commission (CERC).

Coverage

Scope

Targets are set plant by plant, for industries moved over from the earlier PAT energy-saving scheme.

Who is covered

Source: Press Information Bureau (MoEFCC); Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency; Ministry of Power; Press Information Bureau (Ministry of Power); Bureau of Energy Efficiency (BEE); Ministry of Power / Bureau of Energy Efficiency. Checked 2026-11-12.

Table of the same figures
ItemRule
Sectors with targets (Oct 2025)Aluminium 13, cement 186, chlor-alkali 30, pulp & paper 53 — 282 entities
Sectors added (Jan 2026)Textiles 173, refineries 21, petrochemicals 11, secondary aluminium 3 — 208 entities
Total today490 obligated entities (PIB, January 2026): 282 from October 2025 plus 208 from January 2026
Proposed nextIron and steel: 255 entities (draft, 26 June 2026)
Not coveredThermal power plants; fertiliser identified but no targets notified
Emissions countedDirect plus indirect from purchased electricity and heat
Gases7 named, including CO2, CH4, N2O, HFCs, PFCs, SF6 (list not exhaustive)
Baseline / target years2023-24 baseline; targets for 2025-26 and 2026-27
Estimated final scopeAbout 795 entities (March 2025 estimate)
Offsets

Credits and offsets

Credits come from beating a target or from registered offset projects. International use runs through Article 6.

Carbon Credit Certificates and offsets at a glance

Source: Ministry of Power / Bureau of Energy Efficiency; Central Electricity Regulatory Commission (CERC); Ministry of Power; Press Information Bureau (Ministry of Power); Press Information Bureau (MoEFCC). Checked 2026-11-12.

Table of the same figures
ItemStatus
Unit1 Carbon Credit Certificate = 1 tCO2e
Market segments2: a compliance market and an offset market, on power exchanges
Trading frequencyMonthly; draft procedure proposes the last Thursday of each month
Price bandFloor and forbearance price to be approved by CERC; none found published
Bid defaultsMore than 3 in a quarter: barred for 6 months
Offset methodologies9 approved; over 40 entities submitting projects (March 2026)
Offset sectors10 groups, from energy and industry to forestry and carbon removal
Article 614 eligible activities; India–Japan JCM signed 7 August 2025
InstitutionsRegistry: Grid Controller of India; Administrator: BEE; regulator: CERC
Reference

All figures

67 figures with numbers, each linked to the official text with the date we checked it.

ItemValueSource (checked)
Scheme notified28 June 2023 (S.O. 2825(E), under the Energy Conservation Act, 2001)Ministry of Power 2026-11-12
Scheme amended19 December 2023 (S.O. 5369(E))Central Electricity Regulatory Commission (CERC) 2026-11-12
Legal basisEnergy Conservation (Amendment) Act, 2022 — clause (w) of section 14Press Information Bureau (MoEFCC) 2026-11-12
Unit of a carbon credit1 credit = 1 tCO2e reduced, removed or avoidedMinistry of Power / Bureau of Energy Efficiency 2026-11-12
Greenhouse gases named in the scheme7 named (CO2, CH4, N2O, HCFCs, HFCs, PFCs, SF6), list not exhaustiveMinistry of Power / Bureau of Energy Efficiency 2026-11-12
National Steering Committee meetingsAt least 1 meeting per quarter; chaired by the Power Secretary, co-chaired by the Environment SecretaryMinistry of Power / Bureau of Energy Efficiency 2026-11-12
First GEI targets (October 2025)282 obligated entities in 4 sectors: aluminium, cement, chlor-alkali, pulp & paperPress Information Bureau (MoEFCC) 2026-11-12
First target rules gazetted8 October 2025 (G.S.R. 739(E), Environment (Protection) Act, 1986)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Cement entities with targets186 (count of entities listed in Table 2 of the 2025 Rules)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Aluminium entities with targets (October 2025)13 (count of entities listed in Table 1: 8 smelters, 5 refineries)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Chlor-alkali entities with targets30 (count of entities listed in Table 3, CNAOE001–CNAOE030)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Pulp & paper entities with targets53 (count of entities listed in Table 4)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Baseline year2023-24 (baseline output and baseline GHG emission intensity)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Compliance years with targets2025-26 and 2026-27Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Target metrictCO2e per tonne of equivalent product (refineries: tCO2e per MBBLS/NRGF)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
First-year target for the October 2025 sectorsPro rata for 7 months, September 2025 to March 2026Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Second set of targets (January 2026)208 obligated entities: petroleum refineries, petrochemicals, textiles, secondary aluminiumPress Information Bureau (MoEFCC) 2026-11-12
Textile entities with targets173 (count of entities listed in the Second Schedule, TXTOE001–TXTOE173)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Petroleum refinery entities with targets21 (count of entities listed in the Second Schedule, REFOE001–REFOE021)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Petrochemical entities with targets11 (count of entities listed in the Second Schedule)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Secondary aluminium entities with targets3 (Hindalco Taloja, Hirakud FRP, Mouda)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Obligated entities after January 2026490 obligated entities (PIB, 22 Jan 2026: the 282 from October 2025 in aluminium, cement, chlor-alkali and pulp & paper, plus 208 in petroleum refineries, petrochemicals, textiles and secondary aluminium)Press Information Bureau (MoEFCC) 2026-11-12
First-year target for the January 2026 sectorsPro rata for 3 months, January to March 2026Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Iron and steel: draft targets255 entities listed in a draft Third Schedule (G.S.R. 517(E), 26 June 2026); target for 2026-27 onlyMinistry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Comment period for the steel draft60 days from publicationMinistry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Obligated entities if the steel draft is adopted745 = 490 (f22) + 255 (f24)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Estimated eventual coverage (March 2025)About 795 obligated entitiesMinistry of Power 2026-11-12
Estimated obligated entities: Gujarat101 (of 795, March 2025 estimate)Ministry of Power 2026-11-12
Estimated obligated entities: Odisha83 (of 795)Ministry of Power 2026-11-12
Estimated obligated entities: Chhattisgarh76 (of 795)Ministry of Power 2026-11-12
Estimated obligated entities: Rajasthan70 (of 795)Ministry of Power 2026-11-12
Estimated obligated entities: Karnataka55 (of 795)Ministry of Power 2026-11-12
Sectors identified for the compliance mechanism9: aluminium, cement, steel, paper, chlor-alkali, fertiliser, refinery, petrochemical, textilePress Information Bureau (MoEFCC) 2026-11-12
Power sectorThermal power plants not moved from PAT into the CCTS (Dec 2025); fertiliser has no notified targets yetPress Information Bureau (Ministry of Power) 2026-11-12
Emissions countedDirect plus indirect (grid electricity, imported heat) — Scope 1 and 2Bureau of Energy Efficiency (BEE) 2026-11-12
Trajectory period3 years, with annual targets (compliance cycles)Bureau of Energy Efficiency (BEE) 2026-11-12
Penalty for a shortfallEnvironmental compensation = 2 × the average CCC price in that compliance year's trading cycleMinistry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Deadline to pay compensation90 days from the order (imposed by the Central Pollution Control Board)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Draft target rules published16 April 2025 (G.S.R. 234(E))Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Trading rules notifiedCERC CCC Regulations, 2026, dated 27 February 2026Central Electricity Regulatory Commission (CERC) 2026-11-12
Draft trading rulesPublished for comment 13 November 2024Central Electricity Regulatory Commission (CERC) 2026-11-12
Market segments2: a Compliance Market and an Offset MarketCentral Electricity Regulatory Commission (CERC) 2026-11-12
Trading frequencyMonthly (12 sessions a year) unless CERC approves otherwiseCentral Electricity Regulatory Commission (CERC) 2026-11-12
Price bandFloor and forbearance prices for the compliance market, to be approved by CERC on a BEE proposal; no values found in the texts readCentral Electricity Regulatory Commission (CERC) 2026-11-12
Bid-default sanctionMore than 3 defaults in a quarter: barred from CCC dealing for 6 monthsCentral Electricity Regulatory Commission (CERC) 2026-11-12
Proposed trading day (draft, October 2026)Last Thursday of every monthBureau of Energy Efficiency (BEE) 2026-11-12
Expected start of compliance trading2026-27 (stated 13 March 2025)Ministry of Power 2026-11-12
Earlier target dates (September 2024)Mandatory sectors by October 2026; voluntary sectors by April 2026Press Information Bureau (Ministry of Power) 2026-11-12
Offset methodologies approved9 (e.g. grid renewables, hydrogen, landfill methane, afforestation incl. mangroves)Ministry of Power 2026-11-12
Offset project registrants (March 2026)Over 40 registered entities submitting projects (biogas, hydrogen, forestry)Press Information Bureau (Ministry of Power) 2026-11-12
Approved offset sector groups10 groups listed (energy, industries, agriculture, waste, forestry, transport, fugitive, construction, solvent use, CCUS and removals)Ministry of Power 2026-11-12
Indian Carbon Market portal launched21 March 2026, at Prakriti 2026Press Information Bureau (Ministry of Power) 2026-11-12
PAT scheme units moved to CCTS490 of 1,333 PAT units (7 of 13 sectors) became obligated entities in January 2026Ministry of Power 2026-11-12
MRV framework publishedJuly 2024 (Detailed Procedure for Compliance Mechanism)Press Information Bureau (MoEFCC) 2026-11-12
Article 6 authority notified30 May 2022 (NDAIAPA, chaired by the Environment Secretary)Press Information Bureau (MoEFCC) 2026-11-12
Activities eligible for Article 6 trading14 activities (mitigation, alternate materials, removals) under Article 6.2 and 6.4Press Information Bureau (MoEFCC) 2026-11-12
India–Japan Joint Crediting MechanismMemorandum of Cooperation signed 7 August 2025 (Article 6.2)Press Information Bureau (MoEFCC) 2026-11-12
NDC goal the market supportsCut emissions intensity of GDP by 45% by 2030 vs 2005Press Information Bureau (Ministry of Power) 2026-11-12
Emissions intensity of GDP vs 2005: 201012% lowerPress Information Bureau (MoEFCC) 2026-11-12
Emissions intensity of GDP vs 2005: 201421% lowerPress Information Bureau (MoEFCC) 2026-11-12
Emissions intensity of GDP vs 2005: 201624% lowerPress Information Bureau (MoEFCC) 2026-11-12
Emissions intensity of GDP vs 2005: 201933% lowerPress Information Bureau (MoEFCC) 2026-11-12
Example target: Vedanta Jharsuguda Smelter II (aluminium)13.8878 tCO2e/t (2023-24 baseline) → 13.7232 (2025-26) → 13.2965 (2026-27)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Example: required cut by 2026-27 (Vedanta smelter)4.3% below baseline = (13.8878 − 13.2965) ÷ 13.8878 (f63)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Example target: JK Cement Muddapur (cement)0.4455 tCO2e/t (baseline) → 0.4440 (2025-26) → 0.4402 (2026-27), a 1.2% cut by 2026-27 (calc.)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
Formula for credits issued / to buy(target − achieved intensity) × equivalent output in that compliance year = CCCs (1 per tCO2e)Ministry of Environment, Forest and Climate Change / Bureau of Energy Efficiency 2026-11-12
BankingLeftover CCCs carry into later compliance cycles; purchased CCCs may be used only for complianceBureau of Energy Efficiency (BEE) 2026-11-12
InstitutionsRegistry: Grid Controller of India; Administrator: BEE; trading regulator: CERC (3 bodies)Press Information Bureau (Ministry of Power) 2026-11-12
Public budget for the scheme0 central allocation; costs met from fees and BEE's own resources (March 2025)Ministry of Power 2026-11-12
PAT outcome that CCTS builds on27.07 MTOE saved a year; about 115.21 MtCO2 avoidedMinistry of Power 2026-11-12
Questions

Frequently asked questions

Has India's carbon market started trading?

Not in the official records we read up to 12 November 2026. The Ministry of Power said in March 2025 that compliance trading is expected to begin in 2026-27, and BEE's trading procedure was still a draft in October 2026.

How many companies must meet targets?

490 obligated entities after January 2026: 282 from October 2025 and 208 added on 13 January 2026. The 282 is the first notification (G.S.R. 739(E), October 2025, four sectors); the 490 is the total the Press Information Bureau gave on 22 January 2026, after the 13 January notification added 208 entities in four more sectors. A June 2026 draft would add 255 iron and steel entities.

Is it a cap-and-trade system?

No. Each plant gets an emissions intensity target in tCO2e per tonne of product, not an absolute cap. Beating the target earns credits; missing it means buying credits equal to (achieved − target) × output.

What is the penalty for missing a target?

Environmental compensation equal to twice the average price at which credits traded in that compliance year, imposed by the Central Pollution Control Board and payable within 90 days.

What is the price of an Indian carbon credit?

There is no traded price yet. CERC's 2026 rules require trading within a floor and forbearance price band to be approved on a BEE proposal; we found no published band.

Which sectors are covered?

Aluminium, cement, chlor-alkali, pulp & paper, petroleum refineries, petrochemicals, textiles and secondary aluminium. Iron and steel targets are in draft. Thermal power plants were not moved into the scheme.

Can projects outside these industries earn credits?

Yes, through the offset mechanism. Nine methodologies are approved, such as grid renewables, hydrogen, landfill methane and afforestation, and over 40 entities were submitting projects in March 2026.

How does India's scheme link to Article 6?

A national authority set up on 30 May 2022 approves activities for international transfer; 14 activities are eligible. India signed a Joint Crediting Mechanism agreement with Japan on 7 August 2025.

Gaps

Not listed yet

Items we could not confirm in an official text are left out on purpose.

  • Carbon credit prices: no trade and no approved floor or forbearance price found.
  • Total emissions covered by the 490 entities, in tonnes or as a share of national emissions: not stated in the official texts we read.
  • Fertiliser targets: the sector was identified but no target schedule was found.
  • Carbon Credit Certificate price (floor, forbearance or traded) — No CCC trade and no approved price band found in official texts read up to 12 Nov 2026
  • Whether any CCC has been issued or traded — No official issuance or trading record found; latest texts describe procedures in draft (BEE, October 2026)
  • Final iron and steel targets — Only the 26 June 2026 draft (G.S.R. 517(E)) was found; no final notification read
  • Fertiliser sector targets — Listed among the 9 identified sectors, but no notified target schedule found
  • Total emissions covered (MtCO2e or % of national emissions) — Not stated in the official texts read
  • egazette.gov.in originals — Site refused the connection (certificate not trusted by our client); gazette copies hosted by BEE were used instead
  • indiancarbonmarket.gov.in — Returned 403 to automated access; not bypassed
Record

Sources