India's Carbon Credit Trading Scheme (CCTS): is your plant covered?
About 490 plants in seven sectors now have binding emissions-intensity targets. Check whether yours is covered and what it means.
- India’s Carbon Credit Trading Scheme (CCTS) sets legally binding emissions-intensity targets for about 490 plants in seven sectors.
- Targets cover FY2025-26 and FY2026-27, measured against FY2023-24. The first emissions reports were due on 31 July 2026.
- Plants that beat their target earn carbon credits they can sell. Plants that miss must buy credits or pay a penalty.
- Iron and steel targets are still in draft and fertiliser targets were still pending as of September 2026. If you’re in either sector, prepare now.
What CCTS is
CCTS is India’s compliance carbon market. It was set up under the Energy Conservation (Amendment) Act 2022 and notified on 28 June 2023. It replaces the older Perform, Achieve and Trade (PAT) energy-efficiency scheme for the sectors it covers.
Unlike Europe’s carbon market, CCTS does not cap total emissions. It sets a target for emissions intensity: tonnes of CO2-equivalent per tonne of product. A plant can grow output and still comply, as long as each tonne it makes is cleaner.
Who runs it
| Role | Organisation |
|---|---|
| Administrator (sets targets, issues credits) | Bureau of Energy Efficiency (BEE) |
| Registry (holds credits) | Grid Controller of India |
| Trading regulator | Central Electricity Regulatory Commission (CERC) |
| Oversight | National Steering Committee for the Indian Carbon Market |
| Verification | Accredited carbon verification agencies (ACVAs) |
CCTS obligated entities: which plants are covered
Only plants named in a government notification are covered. There is no general size threshold that pulls you in automatically.
| Sector | Plants with targets | Status |
|---|---|---|
| Cement | 186 | Final (Oct 2025) |
| Pulp and paper | 53 | Final (Oct 2025) |
| Chlor-alkali | 30 | Final (Oct 2025) |
| Aluminium | 13 (+3 secondary units, Jan 2026) | Final |
| Textiles | 173 | Final (Jan 2026) |
| Petroleum refining | 21 | Final (Jan 2026) |
| Petrochemicals | 11 | Final (Jan 2026) |
| Iron and steel | About 255 | Revised draft (Jun 2026), from FY2026-27 |
| Fertilisers | To be confirmed | Draft (Jun 2025), final pending |
If you run a plant in one of these sectors, check whether it appears in the notification. Many listed plants were previously designated consumers under PAT.
How the targets work
Each plant has a target for FY2025-26 and a tighter one for FY2026-27, both measured against its own FY2023-24 baseline. About 40% of the required cut falls in the first year and 60% in the second.
At the end of each year:
- Beat your target, and you earn Carbon Credit Certificates (CCCs). One CCC equals one tonne of CO2-equivalent. You can sell them.
- Miss your target, and you must buy CCCs to cover the gap and surrender them.
- Fail to cover the gap, and the Central Pollution Control Board can impose environmental compensation. Under the draft rules this is twice the average CCC price for that trading cycle, payable within 90 days.
CCCs will trade on India’s power exchanges. CERC issued its trading regulations on 2 March 2026. As of early September 2026, the first trades were expected around October; check the latest position before you plan to buy or sell.
CCTS compliance deadlines
| When | What you do |
|---|---|
| Within 3 months of each compliance year starting | Submit a monitoring plan |
| Through the year | Monitor fuel, electricity, process emissions and production |
| Within 4 months of year-end (31 July) | Submit your GHG emissions report, verified by an ACVA |
| After BEE’s assessment | CCCs issued, or the shortfall must be covered |
The central CCTS compliance portal went live on 21 March 2026. The first report deadline was 31 July 2026, for FY2025-26.
Why the numbers are harder than they look
Intensity targets are simple on paper and fiddly in practice:
- Equivalent product. Plants that make several products convert them into one “equivalent product” figure. Get the conversion wrong and your intensity is wrong.
- Boundaries. Captive power, purchased electricity and process emissions all count. Missing a meter or a fuel stream changes the result.
- Evidence. An ACVA will ask for meter data, invoices and production records for every number.
The same data also feeds your BRSR disclosures and, if you export to Europe, your CBAM data. Collect it once and use it for all three.
Does CCTS help with EU CBAM?
Possibly, but don’t count on it. CBAM lets EU importers deduct a carbon price already paid in the country of origin. The EU’s rules for this were still in draft in mid-2026, and CCTS is an intensity scheme where plants that meet their target pay nothing. Plan your CBAM costs without assuming a deduction.
What to do now
- Check the notification for your plant’s name and target.
- Rebuild your FY2023-24 baseline with the official method and check it matches BEE’s figure.
- Forecast your FY2025-26 and FY2026-27 intensity and decide early whether you’ll be buying or selling credits.
- Line up an accredited verifier before the reporting season.
- If you’re in steel or fertilisers, start monitoring now. Steel’s first compliance year is FY2026-27.
FAQs
We're a mid-size cement plant but not on the list. Do we need to do anything?
Not under CCTS compliance. You can still earn credits through the voluntary offset mechanism, which is open to non-obligated entities for approved project types.
Is this the same as PAT?
No. PAT set energy-efficiency targets and traded energy saving certificates. CCTS sets greenhouse gas intensity targets and trades carbon credits. The sectors it covers are moving from PAT to CCTS.
What does a CCC cost?
There is no market price yet. Industry projections range widely, so treat any quoted figure with caution until trading starts.
Sources
- PIB: Carbon Credit Trading Scheme and compliance procedure
- PIB: offset mechanism approved
- Bureau of Energy Efficiency: Indian Carbon Market
- ICAP: targets for nine sectors
- ICAP: compliance obligations enter into force for seven sectors
- ICAP: Indian Carbon Credit Trading Scheme overview
- Business Standard: targets notified for four more industries
- LKS: revised iron and steel targets
- Mercom: CERC rules for carbon credit trading
- Saur Energy: India's carbon market edges toward its first trade
- CEEW: how final targets shape the market
Facts checked on 28 Sep 2026. Rules change often; we update this article when they do.