Centre notifies Green Credit Rules, 2023 to promote Green Credit Programme

On 12-10-2023, the Ministry of Environment, Forest and Climate Change notified the Green Credit Rules, 2023 to leverage a competitive market-based approach for green credit for incentivizing environmental actions of various stakeholders. The provisions came into force on 12-10-2023.

Key Points:

1. Objective-

   • incentivize environmental positive actions through market-based mechanism and generate green credit, which will be tradable and made available for trading on a domestic market platform.

   • To encourage industries, companies and other entities to meet their existing obligations, and encourage other persons and entities, to undertake voluntary environmental measures by generating or buying green credit.

2. Green Credit Programme- The measures that can be taken up for protection, preservation or coversation of the environment are:

   • Tree plantation;

   • Water management;

   • Sustainable development;

   • Waste management;

   • Air pollution reduction;

   • Mangrove conservation and restoration;

   • Eco mark label development; and

   • Sustainable building and infrastructure.

3. Methodology of generating green credit: calculation of green credit will be based on equivalence of resource requirement, parity of scale, scope, size and other relevant parameters required to achieve the desired environmental outcome.

4. Procedure: The Administrator will determine the following and develop a website for the same:

   • Evaluation and verification of activities undertaken;

   • Manner of registration and details required for registration;

5. Responsibilities of Administrator: The Administrator will have to develop the guidelines for the following with approval of the Central Government:

   • effective implementation of the Green Credit programme

   • develop guidelines, processes and procedures

   • develop and establish methodologies, registration process, guidelines and associated measurement, reporting and verification mechanism

   • develop guidelines for the establishment and operation of the Green Credit Registry and trading platform

   • establish or designate the Green Credit Registry, and trading platform service provider in accordance with the approved guidelines

   • develop guidelines for the green credit programme portal, the knowledge and data platform, and for the fees from the registered entities

   • develop guidelines for the market stability mechanism for trading of green credit

6. The Steering Committee and Technical Committee will consist of representatives from Ministries or Departments, experts from the field of the environment, and industry associations.

7. Auditors: The Central Government will appoint independent auditors, on the recommendations of Steering Committee, to audit the Administrator, designated agency, Registry, trading platform and knowledge and data platform within a period of 1 year at the end of every 3rd financial year.