India's Carbon Credit Trading Scheme (CCTS): how it works
A plain guide to India's Carbon Credit Trading Scheme: the law, who runs it, sector targets for 490 entities, the offset mechanism, CERC trading rules and the link to PAT.
What is the Carbon Credit Trading Scheme?
The CCTS creates a single national market where one Carbon Credit Certificate (CCC) equals one tonne of CO2 equivalent (tCO2e) reduced, removed or avoided (CERC Carbon Credit Certificates Regulations, 2026). Its stated aim is to reduce or avoid greenhouse gas emissions across the economy by putting a price on emissions through the trading of these certificates (PIB, Ministry of Environment, Forest and Climate Change, 22 January 2026).
It supports India's climate commitment under the Paris Agreement. BEE notes that India updated its target in August 2022 to reduce the emission intensity of its GDP by 45% by 2030 from 2005 levels (BEE, Indian Carbon Market page, 2026). India's newer NDC for 2031-2035, approved by the Union Cabinet on 25 March 2026, sets a 47% cut by 2035 from 2005 levels (PIB, 25 March 2026).
Sources: Bureau of Energy Efficiency: Indian Carbon Market (CCTS) page; BEE: Detailed Procedure for Compliance Mechanism under the Indian Carbon Market; PIB (MoEFCC), 22 January 2026: Government notifies GHG Emission Intensity Targets for 208 more carbon-intensive industries; PIB (Ministry of Power), 28 March 2025: India's Carbon Offset Plan; PIB (Ministry of Power), 4 December 2025: Framework for CCTS established; PIB (Ministry of Power): Year End Review 2025; PIB (Ministry of Power), 21 March 2026: Prakriti 2026 and Indian Carbon Market Portal launch; CERC (Terms and Conditions for Purchase and Sale of Carbon Credit Certificates) Regulations, 2026; CERC: Current Regulations index; PIB: Cabinet approves India's Nationally Determined Contribution (2031-2035) (25 March 2026)
This article was prepared with AI assistance and checked by the GreenEye team against the sources shown in each section.
Related articles
Carbon credits explained: what is one carbon credit?
What one carbon credit means, compliance vs voluntary markets, avoidance vs removal, additionality, permanence,…
Renewable Energy Certificates (RECs) in India explained
What a REC is (1 MWh), how CERC's REC Regulations 2022 and the 2026 amendment work, how RECs differ from carbon…
BRSR and ESG climate reporting in India: what companies must disclose
A plain guide to SEBI's BRSR and BRSR Core: who must file, the Principle 6 climate indicators including Scope 1 and 2…
How companies measure emissions: building a GHG inventory step by step
A step-by-step guide to a company greenhouse gas inventory: boundaries, activity data, emission factors from CEA and…
Want to understand this for your home or company?
Talk to us. We are happy to explain what this means for you in plain words. We do not sell carbon credits and we cannot promise any result, but we can help you think it through.
Talk to usShare this article