Green Credit Scheme
The Environment Ministry has issued a draft notification detailing a proposed ‘Green Credit Scheme’.
The scheme aims at incentivising a host of activities including afforestation programmes, water conservation, waste management and remedying air pollution by allowing individuals and organisations to generate ‘green credits’.
These credits, through a yet-to-be-specified mechanism, can also be traded for money.
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A Green Credit Programme is proposed to be launched at national level.
To leverage a competitive market-based approach for Green Credits thereby incentivising voluntary environmental actions of various stakeholders.
Apart from incentivising individual/community behaviour, the Green Credit Programme will encourage private sector industries and companies.
As well as encourage other entities to meet their existing obligations, stemming from other legal frameworks, by taking actions which are able to converge with activities relevant for generating or buying Green Credits.
The government’s immediate priority was to “create supply (of green credits)” via voluntary actions and then “create demand by bringing in laws or rules that will incentivise companies and organisations to buy credits that can then be traded.”
An environmental activity generating Green Credits may have climate co-benefits such as reduction or removal of carbon emissions too.
Therefore, an activity generating Green Credits under Green Credit Programme may also get Carbon Credits from the same activity under carbon market.
Unlike carbon markets, where only greenhouse gas emissions were traded, the Green Credit Scheme was “trickier” as it involved accounting for a wide range of actions.
The notification for instance lists out eight sectors, or activities, that can qualify for generating credits.
1. Tree plantation-based green credit
To promote activities for increasing green cover through tree plantation and related activities.
2. Water-based green credit
To promote water conservation, water harvesting and water use efficiency/savings, including treatment and reuse of wastewater;
3. Sustainable agriculture-based green credit
To promote natural and regenerative agricultural practices and land restoration to improve productivity.
Soil health and nutritional value of food produced.
4. Waste management-based green credit
To promote sustainable and improved practices.
Including collection, segregation and treatment.
5. Air pollution-based green credit
To promote measures for reducing air pollution and other pollution abatement activities.
6. Mangrove Conservation and Restoration based green credit
To promote measures for conservation and restoration of mangroves.
7. Ecomark based green credit
To encourage manufacturers to obtain Eco Mark label for their goods and services.
8. Sustainable building and infrastructure based green credit
To encourage the construction of buildings and other infrastructure using sustainable technologies and materials.
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