Question 1

The new rules impose absolute emission caps, restricting the overall production capacity of Indian industries.

Accepted Answer

The targets are strictly based on 'emission intensity' (emissions per unit of output). Industries are free to expand total production as long as they adopt cleaner technologies that reduce the amount of carbon emitted per unit produced.

Question 2

The Ministry of Power is solely responsible for imposing penalties on factories that miss their carbon targets.

Accepted Answer

While the CCTS framework was heavily shaped by the Ministry of Power and the Bureau of Energy Efficiency, the Environmental Compensation (penalty) for non-compliance is actually levied by the Central Pollution Control Board (CPCB) under the Environment (Protection) Act, 1986.

Question 3

Consider the following statements regarding the Greenhouse Gases Emission Intensity Target Rules, 2025:
1. The baseline year for calculating emission intensity targets is Financial Year 2012-13.
2. The rules introduce absolute emission caps for the Iron and Steel sector.
3. The Central Pollution Control Board (CPCB) can levy Environmental Compensation at twice the average trading price of carbon credits for non-compliance.

How many of the above statements are correct?

Accepted Answer

(a) Only one — Statement 1 is incorrect: The baseline year is FY 2023-24, not 2012-13 (which was historically used for early PAT scheme cycles). Statement 2 is incorrect: The targets are intensity-based, not absolute caps, and the Iron and Steel sector was omitted from the initial October 2025 finalized rules. Statement 3 is correct: The CPCB is authorized to levy a penalty equal to twice the average market price of a carbon credit for non-compliance.

Question 4

Match the following institutions with their roles under the Carbon Credit Trading Scheme (CCTS) and the 2025 Rules:
List I (Institution)
1. Bureau of Energy Efficiency (BEE)
2. Grid-India
3. Central Pollution Control Board (CPCB)
4. Ministry of Environment, Forest and Climate Change (MoEFCC)

List II (Role)
A. Imposes Environmental Compensation
B. Functions as the Registry for carbon credits
C. Issues Carbon Credit Certificates
D. Notifies the final sector-specific emission intensity targets

Select the correct answer code:

Accepted Answer

(a) 1-C, 2-B, 3-A, 4-D — The BEE is the administrator that calculates and issues Carbon Credit Certificates (1-C). Grid-India serves as the official registry for tracking the Indian Carbon Market (2-B). The CPCB enforces compliance by imposing Environmental Compensation (3-A). The MoEFCC officially notifies the intensity targets under the Environment (Protection) Act, 1986 (4-D).

Question 5

Assertion (A): The Greenhouse Gases Emission Intensity Target Rules, 2025 do not force industries to cap their total physical output or halt economic expansion.
Reason (R): The targets are defined in terms of tonnes of CO2 equivalent per unit of product output, incentivizing cleaner production methods rather than suppressing gross production volumes.
Select the correct answer:

Accepted Answer

(a) Both A and R are true and R is the correct explanation of A — Because the compliance metric is based on 'emission intensity' (emissions generated per unit of output), companies are not restricted by an absolute ceiling on their total emissions. They can produce higher quantities of goods as long as they simultaneously reduce the carbon footprint per unit, making Reason (R) the exact logical explanation for Assertion (A).

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