The CCTS turns your carbon number into a market position.
Overshoot the target and you buy credits. Beat it and you sell them.
Runs on your public disclosures. Nothing from you.
You are the Head of Sustainability at a plant inside an obligated sector: cement, aluminium, chlor-alkali, pulp and paper, and the others. The first compliance cycle is running. Your intensity number is calculated. You do not know if you are inside the target or outside.
The Carbon Credit Trading Scheme (CCTS) is India's national compliance carbon market, notified by the Ministry of Power on 28 June 2023 under the Energy Conservation (Amendment) Act 2022. Nine hard-to-abate sectors are notified, and seven carry binding targets today: aluminium, cement, chlor-alkali and pulp and paper from October 2025, then petroleum refining, petrochemicals and textiles from January 2026. Iron and steel and fertiliser are in the scheme with targets still to be finalised. Roughly 490 obligated entities get a greenhouse-gas emission intensity target (tCO2e per tonne of output) per compliance cycle. Beating the target generates Carbon Credit Certificates (CCCs). Missing it means buying CCCs from the market or paying a penalty of INR 10,000 per tonne of CO2e in excess. The Bureau of Energy Efficiency runs the scheme.
What CCTS actually is
CCTS runs in two-year compliance cycles. The first cycle covers FY 2025-26 and FY 2026-27, with FY 2023-24 as the baseline year for intensity targets. The Ministry of Environment, Forest and Climate Change sets sectoral GHG emission-intensity targets. Each obligated entity gets its own target under the sectoral trajectory.
One CCC equals one tonne of CO2e reduced below target. CCCs are tradeable on the Indian Carbon Market (ICM) infrastructure being built on the Indian Energy Exchange and the Power Exchange India, with trading expected to open in 2026. An offset mechanism sits alongside for voluntary participants.
Compliance is measured on a plant-by-plant intensity basis. The output metric depends on the sector: tonne of cement, tonne of crude steel, tonne of aluminium, tonne of paper, and so on. The GHG accounting method follows ISO 14064-1 with sector-specific calculation rules published by BEE.
Why now
The scheme is live now, not later. Compliance obligations came into force with FY 2025-26. Targets were notified for four sectors in October 2025 and three more in January 2026, and the first annual emissions report is due to BEE by 31 July 2026. Any obligated entity that has not built a plant-level GHG intensity number is running blind into a market where a wrong number costs INR 10,000 per tonne.
What breaks under CCTS when your carbon number is not defensible.
Three failure modes that recur on CCTS scans.
Intensity calculated on activity that does not match
A cement plant calculates emissions on clinker output but the CCTS target is on cement output. The intensity number is wrong by 20% either way. Compliance verifiers reject.
Scope 2 factor from the wrong year
The plant uses a CEA grid emission factor from three years ago. BEE requires the factor for the compliance year. The intensity gets recalculated on submission and the surplus disappears.
No credit-trading plan
The plant beats its target by 8%. It has no plan to monetise the surplus CCCs. The credits sit on the register for a year while sector prices decline. Value is left on the table.
What CCTS compliance software has to get right.
Three moves, and a general-purpose carbon tool makes none of them.
The right output metric, per sector
Carbon-OS carries every CCTS sectoral rule: cement per tonne of cement, iron and steel per tonne of crude steel, aluminium per tonne of primary aluminium. The intensity number is calculated against the exact metric the compliance verifier uses.
Grid factors that match the compliance year
The Scope 2 factor library is versioned by year and by state. The intensity number for FY 2025-26 uses the FY 2025-26 factors. The compliance filing matches the BEE calculation on submission.
A live position on the CCC market
Carbon-OS shows surplus or deficit against the target every month, at plant level and at group level. The trading team gets a signal, not a year-end surprise.
See where your CCTS number stands. Free scan.
Run the free Carbon X-Ray →Inside a CCTS compliance programme: the hard part is the data, not the carbon.
Four steps a Carbon-OS engagement runs for CCTS, in order.
Boundary and output metric
Plant boundary drawn per BEE rules. Output metric fixed per sector (tonne of cement, crude steel, aluminium, and so on).
Emission inventory
Scope 1 (fuels, process) and Scope 2 (grid, purchased steam) built for the compliance year. Follows ISO 14064-1.
Intensity calculation
Tonnes CO2e divided by tonnes of output. Compared against the sectoral CCTS target.
Verification bundle
A GHG report with source-per-line, ready for the BEE-empanelled Accredited Carbon Verifier.
The phases of a CCTS programme.
Boundary and baseline
Plant boundary drawn. Baseline intensity calculated against FY 2023-24 and reconciled with the BEE trajectory.
Monthly intensity monitoring
Emissions and output tracked monthly. Live position vs target shown at group level.
First annual emissions report
Annual emissions report lodged with BEE for FY 2025-26. This falls inside the cycle, not after it.
Reduction actions or credit-buy plan
For plants outside target, a defined reduction plan or a credit-purchase plan.
Verification and cycle filing
Accredited Carbon Verifier signs. CCTS cycle filing lodged with BEE.
Credit trading
Surplus CCCs listed on Indian Carbon Market. Deficit covered from the market or the penalty is paid.
CCTS against the two nearest frameworks.
| Dimension | EU ETS | PAT Scheme (India, prior) |
|---|---|---|
| Type | Cap-and-trade on absolute emissions | Intensity-based energy-efficiency trading |
| Metric | Tonnes CO2 (absolute) | Specific energy consumption |
| Sectors | Power, industry, aviation, maritime | 13 designated energy-intensive sectors |
| Compliance mechanism | Surrender allowances every year | Meet SEC target or buy ESCerts |
What a Carbon-OS CCTS scan produces.
Every item on this list is what an auditor asks for on CCTS work.
- Boundary map: Plant boundary diagram, signed by the plant head, with sector output metric named.
- GHG inventory: Scope 1 and 2 emissions per source, per month, for the compliance year.
- Emission-factor library: CEA grid factor by year and state; fuel factors from IPCC and BEE where sector-specific rules apply.
- Intensity calculation: Tonnes CO2e ÷ tonnes of output, with the workings on one page for the verifier.
- Reduction actions log: Every efficiency, fuel-switch or process change during the cycle, with the tonnes each saved.
- Verifier hand-off pack: The full evidence set the Accredited Carbon Verifier needs, one place, no follow-up emails.
CCTS compliance questions, answered straight.
Which sectors are obligated under CCTS?
Nine are notified, seven carry binding targets today. Aluminium, cement, chlor-alkali and pulp and paper were notified in October 2025. Petroleum refining, petrochemicals and textiles followed in January 2026. Iron and steel and fertiliser are in the scheme with targets still to be finalised. Roughly 490 entities are obligated across the seven. The list is expected to expand.
When is the first CCTS filing due?
The first annual emissions report is due to BEE by 31 July 2026, for FY 2025-26. That falls inside the first compliance cycle rather than after it. The cycle itself covers FY 2025-26 and FY 2026-27, with FY 2023-24 as the baseline year, and verification against the cycle target follows at the end of FY 2026-27.
What is the penalty for missing the target?
INR 10,000 per tonne of CO2e in excess of the intensity target, converted to absolute tonnes on plant output. Payable in addition to any market purchase of CCCs to close the gap.
Can we bank surplus CCCs?
Yes. Surplus CCCs from one cycle can be banked for use in a future cycle, subject to the rules in force at the time of use.
Does CCTS include Scope 3?
No. CCTS is Scope 1 and Scope 2 at the plant, on the specified output metric. Scope 3 sits outside the compliance boundary.
What does CCTS compliance software actually need to do?
Three things a general carbon tool does not. Calculate intensity on the exact output metric BEE uses for your sector, not a generic tonne. Hold Scope 2 grid factors versioned by year and state so the filing reconciles on submission. And show the surplus or deficit against target monthly, so a credit position is a decision rather than a year-end surprise.
Who verifies our CCTS filing?
An Accredited Carbon Verifier empanelled by the Bureau of Energy Efficiency. The list is published by BEE and updated periodically.
How does CCTS interact with the PAT scheme?
PAT was energy-efficiency-based, in specific-energy-consumption units. CCTS is GHG-intensity-based. Entities coming from PAT have to rebuild the accounting to CCTS metrics.
Can we generate CCCs from voluntary projects?
Yes, through the CCTS offset mechanism running in parallel. Approved project types include renewable energy, energy efficiency, and forestry projects that meet the BEE offset methodology.
Is our intensity target public?
The sectoral trajectory is public. The plant-level target is disclosed to the plant and the sector regulator, not published publicly by BEE.
How does CCTS interact with EU CBAM for our exports?
Carbon paid under CCTS is deductible against CBAM certificates for the same tonne of embedded emissions, subject to the EU CBAM crediting rules. That is why the CCTS number and the CBAM number must reconcile.