CARBON CREDITS, EMISSIONS TRADING AND ENERGY SAVING

Abstract

Emissions trading systems involving carbon credits are a new market-based form of reducing pollution, specifically carbon emissions. It has been growing in popularity, being used in markets across the world after being introduced internationally in the Kyoto Protocol. Now, the country of India is creating its own domestic Carbon Market to begin in 2025. This research paper focuses on understanding the successes and shortfalls of carbon markets that are dominating across the world. The European and Chinese ETS were examined deeply, looking specifically at the impacts on the Gross Domestic Product and how effective they actually were in reducing pollution. The same principles of their successes were taken into account when assessing the Indian carbon market structures, including the running PAT scheme, which would become the base for the countrywide system in 2025. Observing the results of successful industries in the scheme, such as the aluminium, steel, and cement industries, and how those could be replicated economy-wide Using the analysis of the pre-existing emissions trading measures, a conclusion was reached around features of environmental integrity, cost effectiveness, integration with other policies, and greater verification being most suitable for a future carbon market. The paper also considered the ethical and social implications of such a system, as there have been cases of green washing, and even the Chinese system is seen to not entirely move production away from non-renewable sources despite the well-promoted and monitored trading system. Research Question: How can the Modern World prepare itself for the climate crisis in a manner that it does not discount any progress?