India to introduce domestic emissions trading scheme news
27 January 2011

New Delhi: India is seeking to move beyond its traditional command-and-control 'Inspector Raj' systems in pollution control by introducing its own cap-and-trade mechanism to deal with air pollution. This first domestic emissions trading scheme will be launched in the states of Tamil Nadu and Gujarat from 1 February.

The proposed market-based mechanism, modelled after international practises, will introduce self-regulation among industrial units by putting a price on emission of pollutants. By making it costly to pollute industrial units may find it more useful not to pollute or rework their pollution control mechanisms.

Hitherto, under the prevailing command control system, state pollution control boards determined pollution violations and adherence. Now, under the new scheme emission levels of individual units will be determined under a market-based system, where a price will be set on emissions.

The regulator, or state pollution control board, will set an overall limit for emissions of different pollutants and industrial units will self-regulate to ensure that these limits are not breached.

The state pollution control board will set a limit on the amount of categories of air pollutants that can be emitted on the basis of its desired concentration in the atmosphere. The state regulator will then allocate permits for ''acceptable'' level of emissions to industrial units. The industrial units will have the right to trade emissions, so that units exceeding the set level will have to buy permits from those who manage to keep a check on their emissions.

It is expected that the new system will help in lowering pollution levels as well as costs of compliance.

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India to introduce domestic emissions trading scheme