The Government of India published a draft notification under the Environment (Protection) Act, 1986, proposing the Greenhouse Gas Emission Intensity Targets Notification, 2025. This step is part of the compliance mechanism laid out under the Carbon Credit Trading Scheme (CCTS), 2023. The draft notification aims to reduce the emission intensity of greenhouse gases across key industrial sectors and proposes the emission intensity (GEI) targets that regulated entities must meet over the next compliance periods.
The key purpose of this notification is to support India’s nationally determined contributions (NDCs) to reduce greenhouse gas emissions by encouraging industries to lower their carbon emissions per unit of production. The notification also encourages the adoption of sustainable and advanced technologies in traditionally high-emission industries.
The Bureau of Energy Efficiency (BEE), under the Energy Conservation Act, 2001, is responsible for calculating GEI targets using a detailed methodology. Each regulated entity is assigned a baseline emission intensity value and target values for the years 2025-26 and 2026-27. The industries involved include major aluminum and steel producers across states such as Maharashtra, Odisha, Gujarat, Andhra Pradesh, Jharkhand, Chhattisgarh, West Bengal, and Karnataka.
Companies that meet or exceed their emission reduction targets can bank surplus carbon credit certificates, while those that fall short must purchase additional certificates to comply. The number of certificates issued or required for purchase is calculated based on the difference between the actual and target GEI values, multiplied by the production volume.
In case a company fails to comply or submit the required credits, the Central Pollution Control Board (CPCB) will impose environmental compensation. This penalty will be double the average trading price of carbon credits for that cycle. The funds collected will be used to further the objectives of the carbon trading scheme, as directed by the National Steering Committee and approved by the Central Government.
Entities must register and submit all documents on the Indian Carbon Market (ICM) portal within the time limits prescribed by the Bureau. Non-compliance with any provision of this notification will invite penalties under the Environment Protection Act, 1986.
The notification also includes a detailed annexure listing 118 regulated industrial units with their current emission intensity and targets. For example, Hindalco’s Taloja unit in Maharashtra has a baseline intensity of 1.3386 tCO₂e per tonne of equivalent production in 2023-24, with targets of 1.3057 in 2025-26 and 1.2563 in 2026-27. Similarly, large steel plants like Rourkela, Bokaro, and Bhilai Steel Plants have been given specific reduction targets in line with their 2023-24 performance.
The Ministry has invited comments and suggestions on the draft within 60 days of its publication. Responses can be sent to the Ministry of Environment, Forest and Climate Change, either in writing or via email at ccts.hsm-moefcc@gov.in. The final notification will be issued after considering public input.
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