Why CCTS 2025 Matters
India’s Carbon Credit Trading Scheme (CCTS), also known as the Indian Carbon Market Framework, marks a major turning point in the country’s Net Zero journey.
With the 2025 amendments now in force, India has taken a decisive step toward a market-driven carbon reduction system, linking industrial emissions, carbon credits, and GHG intensity targets under one unified framework.
For businesses, especially in hard-to-abate sectors like steel, cement, aluminium, refineries, and fertilisers, the new rules signal a clear shift:
Emission performance is now a tradable, monetizable metric, not just a compliance box.
CCTS: How India’s Carbon Market Works
Under the Energy Conservation Act (2001, amended), the CCTS sets up a robust national mechanism for measuring, reducing, and trading carbon emissions.
Each Carbon Credit Certificate (CCC) represents 1 tonne of CO₂-equivalent (tCO₂e) reduction, removal, or avoidance.
The framework runs on two key mechanisms:
Compliance Mechanism – For obligated entities (energy-intensive sectors) to meet government-assigned emission intensity targets.
Voluntary/Offset Mechanism – For non-obligated entities (projects that reduce or remove GHGs) to generate tradable credits.
Trading will happen through approved power exchanges on a national electronic registry (meta-registry) ensuring full transparency and no double-counting.
Who’s Covered and When?
The compliance mechanism initially targets India’s energy-intensive sectors:
Aluminium
Cement
Chlor-alkali
Pulp & Paper
(Upcoming) Steel, Fertilisers, Refineries, and Textiles
Together, these represent 12–18% of India’s total emissions.
The offset/voluntary mechanism will cover projects across:
Energy efficiency
Waste management
Forestry and land-use
Carbon capture, utilization, and storage (CCUS)
Clean transport and logistics
Timeline:
June 2023: Scheme first notified.
December 2023: Initial amendments.
October 2025: Updated notification adds baselines and targets for key sectors.
2025–26: Compliance trading expected to begin.
2026 onward: Voluntary/offset side to scale.
How It Works: Simplified Flow
Obligated entities receive GHG intensity targets from the Bureau of Energy Efficiency (BEE).
Entities that outperform targets earn Carbon Credit Certificates (CCCs).
Those that fall short must buy certificates to offset their excess.
Offset project developers register verified projects (forestry, waste, CCUS etc.) and generate CCCs for trade.
All transactions are tracked via the national registry, regulated by the Central Electricity Regulatory Commission (CERC) and supervised by the National Steering Committee for Indian Carbon Market (NSCICM).
This market-based approach puts a price on carbon, driving emission reduction where it’s most cost-efficient and rewarding performance.
October 2025 Amendment Highlights
India’s latest notification introduces:
Defined emission baselines and reduction targets for FY 2025–26 and 2026–27.
Expanded list of obligated entities in four key sectors: Aluminium, Cement, Chlor-Alkali, and Pulp & Paper.
Additional sectors (Iron & Steel, Fertilisers, Refineries, Textiles) to follow.
This amendment provides the first quantitative signal for India’s compliance carbon market, aligning national policy with global climate frameworks and industry-level transparency.
What It Means for Businesses
For industry players, CCTS means:
GHG targets become measurable, tradable assets.
Carbon accounting and verification are now essential for compliance.
Digital MRV systems and data transparency will be key to participation.
CCTS creates a unified carbon market, a first for India, enabling cost-efficient decarbonization across sectors.
How Fitsol Helps
At Fitsol, we help industries transition from compliance to competitiveness under CCTS through:
Digital carbon accounting (GreenCount) — measuring Scope 1, 2 & 3 emissions with real-time traceability.
Audit-ready ESG & BRSR reporting (GreenAlign) — ensuring regulatory alignment.
AI-driven scenario modeling (GreenPath) — simulating carbon cost and reduction pathways.
Carbon logistics & offset integration (GreenOps) — linking industrial emission points with carbon storage and trading.
We’re building the digital backbone for India’s connected low-carbon economy.
India’s CCTS 2025 framework cements its role as a market-based climate solution, rewarding carbon efficiency and enabling investment in decarbonization technologies. With structured emission targets and transparent trading, the scheme could reshape how Indian industries value carbon, efficiency, and innovation.