Air Pollution

Particulate Matter Emission Trading Scheme in Gujarat

Why in the News?

A new study highlights the success of Surat’s Particulate Matter Emission Trading Scheme (PM-ETS), the world’s first market-based system for trading particulate emissions.

The scheme has reduced pollution by 20-30%, providing insights into its potential to improve air quality in industrial areas.

About Particulate Matter Emission Trading Scheme in Gujarat:

  • This PM ETS was launched in Surat, Gujarat in 2019.
  • It is the world’s first pilot project targeting particulate pollution using a market-based emissions trading system.
  • It is India’s first emissions trading initiative for any pollutant.
  • The scheme aims to reduce emissions from industries using solid (coal, lignite) and liquid fuels (diesel) by controlling fine particulate matter (PM).
  • How It Works?
    • Cap-and-Trade: Regulators set a cap on total emissions, and industries are issued permits (1 kg of particulate matter per permit).
    • Permit Allocation: 80% of permits are given for free; 20% are sold via auctions.
    • Market Trading: Permits can be bought or sold to meet emission targets. A ceiling price (Rs 100/kg) and floor price (Rs 5/kg) are set.
    • Compliance: Non-compliant industries face fines double the ceiling price for each excess emission.

Successes of PM-ETS:

  • Reduction in Emissions: Participating plants cut emissions by 20-30% compared to traditional methods.
  • Improved Compliance: 99% compliance in participating plants.
  • Cost-Effective: The system allowed industries to choose the most cost-effective methods for compliance.

Limitations of PM-ETS:

  • Over-reliance on Free Permits: Smaller plants may struggle as the number of free permits decreases.
  • Supply Chain Limitations: Tightened caps could increase costs for industries not reducing emissions.
  • Market Manipulation: Concerns over unfair permit trading.
  • Geographical Constraints: Limited to Surat, restricting broader impact.
[UPSC 2011] Regarding “carbon credits’’, which one of the following statements is not correct?

(a) The carbon credit system was ratified in conjunction with the Kyoto protocol.

(b) Carbon credits are awarded to countries or groups that have reduced greenhouse gases below their emission quota.

(c) The goal of the carbon credit system is to limit the increase of carbon dioxide emission.

(d) Carbon credits are traded at a price fixed from time to time by the United Nations environment programs. *

 

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