Green credit program: Incentivizing sustainable actions for a greener future
The Ministry of Environment, Forest and Climate Change, Government of India, is taking a bold step towards a greener future with the introduction of the draft ‘Green Credit Programme (GCP)’ implementation rules for 2023.
This groundbreaking initiative aims to leverage a competitive market-based approach and incentivize voluntary environmental actions by various stakeholders. By introducing the Green Credit Programme, the government seeks to complement the domestic Carbon Market and reward companies, individuals, and local bodies for their sustainable actions through a unique unit of incentive called the ‘Green Credit.’
Unlike traditional carbon credit systems, the Green Credit System goes beyond CO2 emission reductions to encompass a broader range of environmental obligations. These green credits will be tradable, creating a potential market platform where participants can sell their earned credits.
The program offers a diverse array of Green Credit Activities, including tree plantation-based green credit, water-based green credit, sustainable agriculture-based green credit, waste management-based green credit, air pollution reduction-based green credit, mangrove conservation and restoration-based green credit, ecomark-based green credit, and sustainable building and infrastructure-based green credit.
Who’ll manage it?
To ensure the effectiveness and integrity of the program, the Indian Council of Forestry Research and Education (ICFRE) will act as the program administrator. They will develop guidelines, processes, and procedures for implementation, including the establishment of thresholds and benchmarks for each Green Credit activity.
Moreover, the Green Credit Programme encourages private sector industries, companies, and other entities to meet their existing obligations by aligning their actions with those relevant to generating or purchasing green credits.
What’s the objective?
This innovative instrument, the first of its kind, aims to value and reward multiple ecosystem services. By doing so, it allows green projects to achieve optimal returns beyond carbon reductions alone. The guidelines bring together mechanisms to quantify and support ecosystem services, making them invaluable to organic farmers and Farmer Producer Organizations (FPOs). Ultimately, the program serves as a catalyst for sustainable actions and sustainable living, empowering individuals, companies, and local bodies to make a positive impact on the environment.
Despite its good intent on paper, experts raise concerns about the potential for Greenwashing within the market-based mechanism of green credits. Greenwashing involves making false or exaggerated claims about environmental sustainability to create a positive image without delivering significant environmental benefits.
There is a fear that some companies or entities may engage in superficial activities solely to generate green credits, neglecting the need for genuine efforts to address environmental issues. Additionally, questions arise about the efficacy of these mechanisms in achieving urgent emissions reductions and whether resources should be allocated to monitoring and fraud prevention or directed towards more transformative government-led efforts.
Check and Balance
To mitigate these concerns, it is essential to establish robust methodologies and standards for the Green Credit System. Moreover, it is crucial to create additional strategies that generate enough demand for green credits, ensuring the viability and stability of the market. A careful assessment and implementation of the programme, particularly regarding tree plantation and afforestation, is vital. Factors such as unresolved forest ownership and governance rights, ecological and biodiversity challenges, and global critiques of carbon credit schemes need to be carefully considered. Internal discussions and public consultations play a pivotal role in addressing these aspects.
The Green Credit Programme serves as a powerful tool for incentivizing sustainable actions and promoting sustainable living among individuals, companies, and local bodies. While concerns about effectiveness and the risk of Greenwashing exist, the program’s range of Green Credit Activities can help address various environmental challenges.
To ensure its success, it is crucial to establish robust methodologies and standards and implement additional strategies that generate sufficient demand for green credits, ensuring the viability and stability of the market. The Green Credit Programme represents a significant step towards a greener future, fostering environmental consciousness and responsibility.
Content Credit: Times Of India
Author Name: This article is authored by Nishant Saxena