Who will carry out afforestation measures?
The GCP programme for afforestation says that companies can “exchange” their credits for “complying with compensatory afforestation”.
This could be a way, critics say, to ease forest diversion requirements for mining and infrastructure companies.
Secondly, planting trees does not automatically boost ecosystems.
India has about 200 types of forests.
Some are grasslands, some are dominated by shrubs and there have been studies to show that planting the wrong types of trees could fester
invasive species or prevent a sustainable ecosystem.
There is also a threat that natural forests could be razed and invasive monocultures promoted.
Finally, the GCP also says that green credits that result in storing carbon (from trees) may be used for carbon trading.
This again is controversial as the math equating these activities is not clear.
What will States need to do?
In its latest update, the Ministry has issued the guidelines that States must rely on to calculate what it would cost to restore a degraded forest landscape.
The Ministry has tweaked an earlier requirement that there be a minimum of 1,100 trees per hectare to qualify as a reforested landscape and left it to States to specify them.
Not all degraded forests can support that kind of density.
Thus, in some places shrubs, herbs and grasses may be suitable for restoring the ecosystem.
Preference would be given to indigenous species.
The programme was currently in a “pilot project” mode and questions such as how shrubs and grasses could be quantified in terms of green credits were still being worked out.
Moreover, companies would not be able to offset all their obligations under compensatory afforestation using green credits, but could claim a portion of it.
Can companies trade ‘green credits’?
Yes, companies can trade "green credits" under certain circumstances.
Types of Green Credits: The term "green credit" can be broad.
The most common type refers to carbon credits.
These credits represent one ton of carbon dioxide (CO2) or equivalent reduction in greenhouse gases.
Trading Mechanisms: There are two main ways companies can trade carbon credits:
Cap-and-Trade Systems: In these programs, companies are issued a set number of emission allowances.
Companies that exceed their allowance can buy credits from others with a surplus.
This system creates a financial incentive to reduce emissions.
Voluntary Markets: Companies can also buy and sell carbon credits directly through voluntary markets.
These markets are not regulated by governments, but they can still help companies offset their emissions and achieve sustainability goals.
Trading Limitations: Not all "green credits" are created equal.
There can be concerns about the legitimacy of some credits, particularly regarding whether they represent real and verifiable emission reductions.
Additionally, some credits may be tied to specific compliance obligations and not tradable on the open market.
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