India's Carbon Credit Trading Scheme (CCTS), notified in June 2023 under the Energy Conservation (Amendment) Act, creates a domestic carbon market where industries earn tradeable credits for verified emission reductions. Switching from coal to biomass pellets is one of the most straightforward pathways to generating CCTS credits — and one of the fastest-payback compliance investments for Indian industrial buyers.
What is the CCTS?
The CCTS is India's mandatory carbon market for designated entities (large energy consumers under BEE's PAT Scheme) and a voluntary market for others. Entities that reduce emissions beyond their baseline earn Carbon Credit Certificates (CCCs), which can be traded on designated exchanges (IEX, PXIL). The scheme is administered by the Bureau of Energy Efficiency (BEE) under the Ministry of Power.
How Biomass Switching Generates Credits
The CCTS emission factor for coal combustion is approximately 0.95 tCO₂/GJ of thermal energy. Biomass pellets have a near-zero lifecycle emission factor under the CCTS methodology (agricultural residue-based biomass = carbon neutral). For every tonne of coal replaced by an equivalent energy quantity of biomass pellets, approximately 2.5–3.0 tCO₂e in CCTS-eligible emission reductions are generated.
Credit Calculation Example
| Parameter | Value |
|---|---|
| Coal replaced per month | 100 MT |
| Coal emission factor | 2.5 tCO₂e/MT (approx) |
| Monthly emission reduction | 250 tCO₂e |
| Annual emission reduction | 3,000 tCO₂e |
| CCTS credit price (2026 estimate) | ₹600–₹900/tCO₂e |
| Annual credit revenue | ₹18–₹27 lakh |
The Verification Process
- Establish baseline: Document 12 months of pre-switch coal consumption with invoices and weighbridge records
- Register project: Submit project design document to BEE-approved Designated Agency
- Monitor and measure: Track biomass consumption monthly with NABL-certified fuel receipts from BBI
- Third-party verification: BEE-accredited verifier (e.g., TERI, CRISIL) reviews monitoring data annually
- Credit issuance: BEE issues Carbon Credit Certificates (CCCs) to verified project account
- Trade on exchange: List CCCs on IEX or PXIL at prevailing market price
Who Qualifies for Voluntary CCTS Credits?
Any industrial entity not covered under PAT Scheme (i.e., <30,000 MTOE/year energy consumption) can participate in the voluntary CCTS market. This includes most medium-sized textile mills, food processors, and ceramic units. Mandatory participation applies to PAT-designated large consumers.
BBI can provide biomass supply documentation suitable for CCTS project registration — including batch certificates, HSN classification, and carbon-neutral status declaration. Contact us to start your CCTS journey.