Weak Carbon Market May Encourage Indian Firms to Keep Polluting

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Or sign-in if you have an account.8)2lm4f1k9u1lm{sdycgzhw7_media_dl_1.png European Commission, Joint Rese(Bloomberg) — Weak penalties and expected low allowance prices mean India’s planned national carbon market will deliver little incentive to steelmakers, cement producers and other heavy industries to quickly curb emissions, according to a new study.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountTrading in the nation’s carbon credit system, which initially covers nine major sectors, is scheduled to begin by about October, according to the Bureau of Energy Efficiency. Polluters included in the market began measuring emissions against new intensity targets from last year.Credits are initially expected to trade at around $10 per ton of carbon dioxide equivalent, a rate that’s too low to provide a catalyst for action and far lower than in similar markets globally, said the report by Climate Risk Horizons, a Bengaluru-based think tank. The cost of purchasing credits to cover emission shortfalls would on average equate to 0.6% of annual profit for aluminum smelters, 1% to 2% for cement producers and 7% for steel companies.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try again“Financial incentives to adopt low-carbon industrial processes must be strengthened for the policy to be truly effective,” said Anirudh TR, a research analyst at the think tank and lead author of the study. “For many high-margin polluters, ‘paying to pollute’ could become a preferred business strategy.”India’s Bureau of Energy Efficiency, responsible for administration of the carbon credits market, didn’t immediately respond to a request for comment.The market’s impact will also be limited by the absence of the power sector, which is not covered in the initial stages and accounts for about 55% of India’s greenhouse gas emissions, the report said. Additionally, a focus on emission intensity means the absolute volume of pollution could still increase — not fall — as production from included industries grows.India, the world’s third-largest source of greenhouse gases, has long remained resistant to setting absolute limits on emissions as it attempts to balance economic growth and action on global warming. A new climate target set in March by Prime Minister Narendra Modi’s government seeks a 47% reduction in emissions intensity — the amount of pollution generated per unit of gross domestic product — by 2035 from 2005 levels, only a modest advance on a previous plan.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.