India adds four sectors to Carbon Credit Trading Scheme via 2025 rules

The Ministry of Environment, Forest and Climate Change notified the Greenhouse Gas Emission Intensity Targets (Amendment) Rules, 2025, dated January 13, 2026, adding secondary aluminium, petroleum refineries, petrochemicals and textiles to the Carbon Credit Trading Scheme. Major obligated entities including Reliance, IOC and BPCL must now track emissions against benchmarks for compliance periods starting January 2026.

The Ministry of Environment, Forest and Climate Change (MoEFCC) notified the Greenhouse Gas Emission Intensity Targets (Amendment) Rules, 2025, dated January 13, 2026, expanding India's domestic Carbon Credit Trading Scheme. Issued under the Energy Conservation Act, 2001, the amendment introduces a Second Schedule broadening scope to four new sectors: secondary aluminium, petroleum refineries, petrochemicals, and textiles. This follows the October 2025 notification covering primary aluminium, cement, chlor-alkali, and pulp and paper. Each sector now has specific baseline intensities derived from the 2023-24 financial year, ensuring comprehensive coverage of the nation's industrial carbon footprint.

Major industrial players are listed as obligated entities. In petroleum refining, Bharat Petroleum, Indian Oil Corporation, and Reliance Industries must meet intensity targets based on crude throughput. The petrochemical segment includes units operated by GAIL and ONGC Petro additions. The textile sector focus is primarily on spinning units across Tamil Nadu, Rajasthan, and Punjab. These entities are legally required to track and report emissions against set benchmarks across two compliance periods: the 2025-26 financial year, calculated pro-rata for the remaining three months from January to March 2026, and the full 2026-27 year.

Obligated entities should prepare to track and report emissions against sector-specific benchmarks, with 2025-26 targets calculated pro-rata for January to March 2026 and 2026-27 targets based on revised 2025-26 benchmarks ensuring progressive reduction. The notification substitutes Note 2 and inserts a new Note 3 clarifying calculation methodology for different schedules. Affected entities should monitor opportunities to earn tradeable carbon credits by exceeding reduction obligations, since compliance transitions from a regulatory burden to a strategic opportunity for generating environmental assets supporting India's net-zero-by-2070 goal.

Key figure — First compliance period: pro-rata targets for January to March 2026