Whalesbook
Regulatory Overhaul
India has formalized its Carbon Credit Trading Scheme (CCTS), establishing a government-run carbon pricing system. This move shifts away from private registries to a unified governance structure under the Bureau of Energy Efficiency, integrating the carbon market into national climate goals and the Paris Agreement. Project developers now face a new intensity-based, baseline-and-credit mechanism requiring strict regulatory compliance.
Global Standards Clash
A key concern is the CCTS's lack of explicit harmonization with international standards like Verra or the Gold Standard. International buyers may face uncertainty about the valuation of CCTS-issued certificates in global markets. While existing projects can still use international methodologies, developers must manage a complex dual-track regulatory environment to meet both domestic requirements and potential future international tradeability changes.
Risks for Nature Projects
Nature-based solutions, such as afforestation and ecosystem restoration, face unique challenges. These projects depend on land tenure and community resources, and the CCTS's rigorous monitoring, reporting, and verification (MRV) standards may not fully capture the long-term carbon sequestration of land-based projects. Issues with land ownership, community consent, and the permanence of carbon sinks are significant vulnerabilities. Failure to secure clear land titles or community approval could jeopardize credit issuance.
Potential Structural and Reputational Threats
Critics suggest the CCTS could become a closed system, limiting international capital flow and stifling innovation. India's history of