According to the leading consulting firm, PwC (PricewaterhouseCoopers), India needs to put efforts in eliminating risks and motivate private sector investments in low-carbon technologies. Now, India can consider developing a domestic emission trading system that will allow the private sector to participate and sells current, retroactive, and future credits.
The entire thing was decided at the annual meeting of signatories to UNFCCC (UN Framework Convention on Climate Change) in Spain. The signatories postponed the decision based on the emissions trading system and reconsider the increase in emission reduction targets across the world.
According to PwC, India is at higher risk of cancellation of tenders, import duties, land buying uncertainties, etc. There is a requirement of policy interventions and financial instruments to enhance the participation of the private sector. A cut-off will be decided via the NDC (Nationally Determined Contribution) commitment period for the retroactive credits.
It is essential to ensure that market regulations must be strict enough to get proper quality credits and prevent market saturation. The quality of credits will depend on the principles of additionality and sustainable development. India is going on with its experiments on different mechanisms like perform achieve, carbon tax and trade scheme along with renewable energy. But there were no desired results.
According to the report, all the existing mechanisms and resulted challenges might be reviews, and a cross-sectoral trading mechanism will be developed for the private companies so that they can initiate in investing in clean energy, climate-smart technology and waste to energy. The companies in India are unable to identify the risks based on climate change and do something about it. According to the Task Force on Climate-related Financial Disclosures (TCFD), there is a need for policy instruments to the private companies for disclosing the information.
Now, if the value of credits suddenly loses, then there will be a setback for the private sector, and they may lose hope in market mechanisms. Every country needs to minimize emissions to mitigate global warming by sharing its plans and progress reports on the execution of the plans.
