Why in News?

• The Union Environment Ministry has recently notified a new methodology for awarding green credits under the Green Credit Programme (GCP).
• This replaces the earlier methodology, with significant changes in eligibility, time frame, and use of credits.

What’s in Today’s Article?

• Overview of the Green Credit Programme (GCP)
• Key Changes in Rules
• Rationale Behind Changes
• Conclusion

Overview of the Green Credit Programme (GCP):

• Launched: In November 2023, at the UN Climate Conference (COP28, Dubai) by the Prime Minister of India.
• Objective: To promote voluntary environmental protection actions such as tree plantation, water conservation, waste management, etc.
• Mechanism: Under GCP, the environment ministry seeks ‘voluntary actions’ from companies, individuals, or groups for environmental protection activities, and awards credits in return.

Key Changes in Rules:

• Awarding of credits:
  • Earlier system: The earlier benchmark awarded green credit subject to a minimum density of 1,100 trees per hectare, within two years of plantation. It is criticized for not focusing on survival, and quality and density of canopy.
  • New methodology:
    • Those who have invested in tree plantation activities will earn green credits on completion of a minimum of five years of restoration activities on degraded forest land.
    • The green credit shall be calculated based on the vegetation status, including the change in the canopy density (after achieving a minimum canopy density of 40%) and the number of surviving trees.
• Tradability of credits:
• Earlier system: Market-based trading of credits.
• New methodology: The credit for tree plantation will be non-tradable and non-transferable, except in the case of transfer between the holding company and its subsidiary companies.
• Permissible uses of green credits:
  • Those involved in tree plantation under GCP will still be allowed a one-time exchange of green credit for compensatory afforestation obligations,
    • To meet corporate social responsibility requirements or
    • For other legal tree planting obligations.
  • The credit will cease after exchanging it for compliance with legal obligations.
  • The credit for tree plantation may be used for reporting under environmental, social, and governance (ESG) leadership indicators.

Rationale Behind Changes:

• Focus on quality and survival:
  • Moves away from just counting trees per hectare.
  • Emphasizes long-term health of plantations (minimum 5 years).
  • Addresses criticism of government afforestation drives that focus on quantity over survival and canopy quality.
• Focus on credibility:
  • So far, 57,986 hectares of degraded forest land have been registered under GCP, as per government data.
  • Revised rules expected to improve credibility and long-term sustainability.

Conclusion:

• The revised Green Credit Programme marks a shift from tokenistic tree-plantation drives to sustainable ecological restoration with a focus on quality, survival, and canopy growth.
• Going forward, this approach can strengthen India’s climate resilience, improve biodiversity, and enhance corporate accountability in environmental stewardship.