In a landmark move to align with India’s climate commitments under the Paris Agreement, the Ministry of Environment, Forest and Climate Change (MoEFCC) has drafted a proposal mandating greenhouse gas (GHG) emission reduction targets for both public sector undertakings (PSUs) and private refineries, as well as the textile industry. This marks the first time these sectors have been formally brought under the Nationally Determined Contributions (NDCs) framework.
Key Highlights of the Draft Proposal
- Targeted Sectors: Petroleum refineries, petrochemical units, and textile manufacturing facilities
- Entities Covered: Indian Oil Corporation (IOC), Bharat Petroleum (BPCL), Hindustan Petroleum (HPCL), GAIL, ONGC, Reliance Industries, Nayara Energy, among others
- Emission Metrics: Reduction targets are defined in tonnes of CO₂ per tonne of production
- Carbon Credit Mechanism:
- Units exceeding targets can earn carbon credit certificates
- Units falling short must purchase or surrender credits to offset the gap
- Non-compliance will attract environmental compensation, calculated at twice the average carbon credit price
Sector-Specific Targets
- IOC Guwahati Refinery: Reduce from 7.78 tCO₂/t (FY24) to 7.03 tCO₂/t by FY27
- BPCL Mumbai Refinery: Reduce from 3.97 tCO₂/t to 3.80 tCO₂/t in the same period
These targets are designed to push industries toward cleaner fuels like green hydrogen, renewable energy adoption, and process optimization.
Broader Climate Strategy
This draft follows an earlier April 2025 notification that covered aluminium, cement, chlor-alkali, and pulp & paper sectors. The current expansion reflects India’s ambition to cut GHG emission intensity by 45% by 2030 (from 2005 levels) and achieve net-zero emissions by 2070.
The draft is open for public and stakeholder feedback, with final notification expected within the next few months. The initiative also lays the groundwork for India’s carbon market, set to launch in 2026.
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