Over 250 steel plants assigned emission reduction targets under draft rules to promote cleaner production
July 8, 2026: The Union Ministry of Environment has issued a draft notification proposing to bring India’s iron and steel sector under the Carbon Credit Trading Scheme (CCTS), assigning greenhouse gas (GHG) emission intensity reduction targets to 255 major steel plants. Issued under the Environment (Protection) Act, 1986, the draft notification will remain open for public comments for 60 days before being finalised. The move expands the CCTS, launched in 2023, which already covers sectors such as aluminium, cement, petroleum refineries, petrochemicals, textiles, and pulp and paper.
The proposed rules set plant-specific emission reduction targets for 2026-27, using 2023-24 as the baseline year. Companies that successfully meet their targets will receive carbon credits, while those failing to comply will have to purchase credits from the domestic carbon market. The government aims to encourage industries to adopt cleaner technologies, improve energy efficiency, and reduce greenhouse gas emissions through market-based incentives.
Experts have welcomed the inclusion of the steel industry, one of India’s largest industrial emitters, calling it a key step in operationalising the country’s domestic carbon market. According to the Centre for Science and Environment, the initial targets are expected to encourage cost-effective efficiency improvements, while future compliance cycles could drive long-term investments in low-carbon technologies. As the world’s second-largest steel producer, India’s transition toward cleaner steel production is expected to play a crucial role in shaping the sector’s future emissions.