India has finalised a list of activities that can be considered for trading in carbon credits in the international market under article 6 of the Paris Agreement.
The list includes carbon removal activities such as carbon capture and storage; and mitigation activities such as generating renewable energy with storage (only stored component), solar thermal power, off- shore wind, green hydrogen and compressed bio-gas and alternate materials such as green ammonia, the union environment ministry announced on Friday.
The list is actually a wishlist of areas where India would like to attract investments with the carbon credits generated from offsetting of carbon emissions through these technologies then shared with the investing country/company under the market mechanism.
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“By announcing the list of activities, we have basically now put our intent in public domain that we are seeking investments in these emerging technologies. We want countries/companies to invest and bring these technologies to India where they can then be indigenized. We will provide carbon credits in return to the concerned country or company which they can use for mitigation. This list is applicable only for three years . The list may change thereafter,” said a senior official of the union environment ministry who specialises in article 6 of the Paris Agreement.
{{/usCountry}}“By announcing the list of activities, we have basically now put our intent in public domain that we are seeking investments in these emerging technologies. We want countries/companies to invest and bring these technologies to India where they can then be indigenized. We will provide carbon credits in return to the concerned country or company which they can use for mitigation. This list is applicable only for three years . The list may change thereafter,” said a senior official of the union environment ministry who specialises in article 6 of the Paris Agreement.
{{/usCountry}}“Japan and Singapore to an extent have already expressed interest in cooperating with us under article 6.2. We will see how countries respond now. Then bilateral meetings will take place on what will be the terms of such investments. Indigenizing these technologies will help India achieve its own climate goals as well,” added the official who asked not to be named.
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Other activities listed by India include emerging mobility solutions such as fuel cells; high end technology for energy efficiency; sustainable aviation fuel; tidal energy, ocean thermal energy, ocean salt gradient energy, ocean wave energy and ocean current energy, and high voltage direct current transmission in conjunction with renewable energy projects
India notified the National Designated Authority for the Implementation of the Paris Agreement (NDAIAPA) on May 30, 2022. The Authority is mandated to take decisions in regard to the type of projects that can participate in international carbon market under Article 6 mechanisms. This is in the backdrop of the Paris Agreement Rulebook being finalized in respect of Article 6 which focuses on carbon trading through bilateral/cooperative approaches and international market mechanisms
“These activities will facilitate adoption/transfer of emerging technologies and may be used to mobilise international finance in India. The activities will initially be for the first 3 years and may be updated/revised by NADAIPA,” the union environment ministry said in a statement.
Article 6 of the Paris Agreement allows countries to voluntarily cooperate with each other to achieve emission reduction targets set out in their nationally determined contributions. Under Article 6, a country will be able to transfer carbon credits earned from the reduction of greenhouse gas emissions to help one or more countries meet climate targets. Within Article 6, Article 6.2 creates the basis for trading in GHG emission reductions (or “mitigation outcomes”) across countries, according to the World Bank.
“This is a great development. The list of technologies in India’s communication clearly shows that the government wants to use Article 6.2 for pushing emerging technologies like hydrogen, storage and CCS among others. This is sensible and strategic as it would provide much needed finance for accelerating the deployment of technologies of the future, while ensuring that the emissions credits that India will need to let go due to corresponding adjustment is minimal. India has bet on a trade-off that is bound to secure high returns,” said Vaibhav Chaturvedi, Fellow, Council on Energy, Environment and Water (CEEW).