The Union environment ministry has issued a draft notification to bring the iron and steel sectors under the Carbon Credit Trading Scheme (CCTS), assigning greenhouse gas (GHG) emission intensity reduction targets to over 250 plants to reduce emissions.
The draft dated June 26 refers plant-specific GHG emission intensity targets under the Environment (Protection) Act, 1986. It has been issued for 255 major plants for public comments for 60 days before the rules are finalised.
The proposed rules expand the scope of CCTS, notified in 2023, which covers sectors such as aluminium, cement, pulp and paper, petroleum refineries, petrochemicals and textiles.
Emission reduction targets have been set for 2026-27, taking 2023-24 as the baseline. Those meeting the emission targets will be provided carbon credits. Those failing to meet it will be required to purchase carbon credits from the domestic market, thus incentivising a shift towards cleaner and more efficient technology.
“...in exercise of the powers conferred by sections 3, 6 and 25 of the Environment (Protection) Act, 1986... the Central Government hereby proposes to issue the draft notification... and it is hereby notified that the said notification shall be taken into consideration after the expiry of a period of sixty days from the date on which copies of the Official Gazette containing this draft notification are made available to the public,” the notification said.
The steel sector is among the country’s largest industrial emitters, making its inclusion a significant step in operationalising the domestic carbon market, experts say.
{{/usCountry}}The steel sector is among the country’s largest industrial emitters, making its inclusion a significant step in operationalising the domestic carbon market, experts say.
{{/usCountry}}Parth Kumar of the Centre for Science and Environment’s Sustainable Industrialisation Unit said the revised draft targets are slightly delayed but an important step in operationalising CCTS for the steel sector. “Given the complexity and diversity of steel production routes, it is encouraging to see the process moving forward. The initial targets are likely to drive improvements through energy efficiency and other relatively low-cost operational measures.”
Kumar said the real test will be whether future compliance cycles begin to influence long-term investment decisions and accelerate the adoption of low-carbon technologies that bring about a deeper, structural shift in the sector’s emissions trajectory. He added that, as the world’s second-largest steel producer, the choices made today will shape the sector’s emissions trajectory for decades to come.
The draft notification covers some of India’s largest producers and assigns targets for reducing their emissions.