Explained: What is a carbon market, and why does India want to create one? | Explained News,The Indian Express

A Bill to amend a 20-year law, the Energy Conservation Act, was introduced in Parliament Wednesday. One of the most significant provisions of the Bill is to create a domestic carbon market.

In order to facilitate the achievement of more ambitious climate change targets and ensure a faster transition to a low-carbon economy, the government is seeking to strengthen a 20-year law, called the Energy Conservation Act of 2001, which has powered the first phase of India’s shift to a more energy-efficient future.

The Bill to amend the Energy Conservation Act, 2001, which was introduced in Parliament on Wednesday, has two main objectives. First, it seeks to make it compulsory for a select group of industrial, commercial and even residential consumers to use green energy. A prescribed minimum proportion of the energy they use must come from renewable or non-fossil fuel sources. And second, it seeks to establish a domestic carbon market and facilitate trade in carbon credits.

Importantly, the amendment Bill seeks to widen the scope of energy conservation to include large residential buildings as well. Till now, the energy conservation rules applied mainly on industrial and commercial complexes.

Energy Conservation

The 2001 law defined standards for energy conservation and efficiency to be followed by a select group of industries and commercial complexes. Efficiency standards were also prescribed for equipment and appliances like air conditioners or refrigerators. This law set up the Bureau of Energy Efficiency (BEE) to promote the use of more efficient processes and equipment in order to save energy. The star ratings on various household appliances and the largescale shift to LED bulbs were some of the successful initiatives of BEE that have resulted in massive energy savings over a period of time.

https://indianexpress.com/article/explained/india-energy-conservation-act-amendments-carbon-market-8071828/


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