Jairam Ramesh, the environment and forests minister of the Indian Government has said that the Indian government has approved the sale of Certified Emission Reduction certificates of more than 1,400 projects that could attract around Rs.28000,00,00,000/- (Rs.Twenty Eight Thousand Crore Only) as part of the clean development mechanism into the country by 2012.
The National CDM Authority functioning in India has accorded the Host Country Approval to 1,455 projects. These projects need to get registered at the CDM executive board. These projects have seen an investment of more than $33.7 billion(Rs 1.6 lakh crore).
The developers will earn over 600 million CERs by 2012. The estimated earning at a conservative price of $10 per CER, will work out to a little over $6 billion.
The minister further said to Business Standard that, "This is the potential foreign direct investment that India stands to earn from carbon credits. In fact, 10 per cent of India's annual greenhouse gas emissions can be neutralised because of this. India may be the second-largest country in terms of the number of CDM projects (after China) but is the best in terms of implementing them."
For those who do not know what CDM is... here is the explanation.
The Clean Development Mechanism (CDM) is an arrangement with some countries (called as Annex 1 countries) under the Kyoto Protocol who have committed themselves for investing in developing countries to offset or compensate their emissions. In other words if a Industry feels that it is expensive to adopt to carbon reduction method in its country it can invest in another country using its technology and reducing the emission in that another country. It may even be a join venture and its own industry in that other country.
The CDM allows net global greenhouse gas emissions to be reduced at a much lower global cost by financing emissions reduction projects in developing countries where costs are lower than in industrialized countries.
The CDM is supervised by the CDM Executive Board (CDM EB) and is under the guidance of the Conference of the Parties (COP/MOP) of the United Nations Framework Convention on Climate Change (UNFCCC).
There are two methods one can earn carbon credits. A tone of carbon equals One Carbon credit. Carbon trading is calculating one’s carbon footprints and to offset it purchasing of carbon neutral certificates. The money then will so got will be invested in environmental friendly projects. If you like to know how much is your carbon footprints Calculate here in Carbon Advice Group link.
Carbon credits are a key component of national and international attempts to mitigate the growth in concentrations of GHGs.
Carbon Offset Credits, are clean forms of energy production like wind, solar, hydro and biofuels. And Carbon Reduction Credits are storage efforts comprising of collection and storage of carbon from the atmosphere through biosequestration (reforestation, forestation), ocean and soil collection.
Project-financing activity which is now at a stagnant pace after Copenhagen summit meetings, will zoom to a very big market when public will enter in a huge way to save the world by buying carbon offsets. There is huge market in carbon trading and the business will pick up and buyers will enter into deals more pronouncingly after 2012.
Asia is the leading supplier of Carbon Emission Reduction certificates in the global carbon market. I holds approximately 77 per cent of the share. Over 3,714 projects are developed under CDM all over Asia.
The project developed by CDM mostly comprises of future-installed power projects, which will have a capacity of around 58 Gw in hydro, wind, biomass, geothermal, biogas, landfill gas, solar, tidal, energy efficiency-based own generation, and coal bed/coal mine methane sectors.
India has generated around 30 million carbon credits, and another 140 million or so are in pipeline. About 225 Indian projects in the fields of biomass, cogeneration, hydropower, and wind power with a potential of 225 million Carbon Emission Reduction certificates have been registered.
We may see a rise in Carbon offsets from solid waste projects too. At present, the Indian solid waste management market is witnessing tremendous growth. Currently it is valued at around $155.56 million (Rs 728 crore) and is expected to grow at a rate of around 20 to 25 per cent in the next three to five years.
To be in touch with the booming Carbon Trade business and to know about the latest happenings in this industry join Carbon Advice Group.
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