The Ministry of Environment, Forest and Climate Change (MoEFCC) has taken a significant step towards the implementation of the Green Credit Programme (GCP) by notifying the draft rules for the program. The GCP aims to incentivize and reward individuals, industries, farmers producers organizations (FPOs), urban local bodies (ULB), gram panchayats, and private sectors for undertaking environment-friendly actions.
Under the program, participants will have the opportunity to earn "green credits" for engaging in various eco-friendly activities such as tree planting, water conservation, waste management, and air pollution reduction. These green credits will have a monetary value and can be traded on a proposed domestic market platform, allowing participants to monetize their environmental efforts.
Union Environment Secretary, Leena Nandan, stated that the draft notification will be made available for public review and input for a period of 60 days. After considering any objections and suggestions, the final rules will be notified. The draft rules come following Union Finance Minister Nirmala Sitharaman's announcement of the program in the 2023-24 budget and the subsequent preparation of the draft contours by the MoEFCC.
The MoEFCC has identified eight specific activities under The Environment (Protection) Act, 1986, for which green credits can be earned. These activities include tree plantation, water conservation, waste management, air pollution reduction, mangrove conservation and restoration, promoting natural and regenerative agricultural practices, construction of sustainable infrastructure, and using eco-mark-based green credit.
Entities participating in the program will also be required to pay environmental compensation in case of violations. The collected compensation will be deposited into a dedicated account managed by the GCP administrator. These funds will be utilized for market stabilization efforts and other activities related to the implementation of the GCP, as approved by the steering committee.
The trading platform for green credits will facilitate the connection between suppliers and buyers. Environmentally conscious companies and industries seeking to undertake eco-friendly interventions may purchase green credits from the platform, allowing them to avail loans at reduced interest rates.
Thresholds and benchmarks will be developed for each green credit activity, ensuring that the issuance of green credits is based on achievable environmental outcomes, resource requirements, and other relevant parameters. The government will also establish digital processes for the GCP, including self-assessment of eligible green credit activities, project registration, credit issuance, and performance monitoring.
The implementation of the GCP will be overseen by a steering committee headed by the environment secretary. This committee, comprising officials from relevant ministries/departments, domain experts, and industry associations, will approve procedures, rules, and regulations, as well as make recommendations for the issuance of Green Credit Certificates to the central government.
The Indian Council of Forestry Research and Education (ICFRE) has been designated as the GCP administrator and will be responsible for managing, monitoring, and operating the entire program. The ICFRE will register green credits, maintain transaction records, and ensure that trading activities adhere to the necessary standards. Technical committees will be established by the ICFRE to develop methodologies, standards, and processes for project registration and the granting of green credits.
Furthermore, the ICFRE will issue guidelines for the establishment of the trading platform and specify the procedure for accrediting entities as green credit verifiers. Additionally, activities that contribute to carbon emissions reduction or removal may accrue both green credits and carbon credits, which can be sold on the respective markets.
