India Removes FY26 Carbon Emission Targets for Refineries and Textile Units Under Carbon Credit Scheme

The Centre has withdrawn mandatory greenhouse gas emission targets for refineries and textile units for the financial year 2025-26 under India's Carbon Credit Trading Scheme (CCTS). 

The change was notified by the Bureau of Energy Efficiency (BEE) on September 7. However, the emission targets set for FY27 remain in place. 

21 Refinery Units Affected by the Change 

The amendment covers 21 units in the refinery sector. These include facilities operated by Indian Oil, Reliance Industries' Jamnagar refinery and Nayara Energy's Vadinar plant. 

The textile sector is also affected, with many of the 173 units covered by the scheme located in Gujarat, Tamil Nadu and Rajasthan. 

The original emission targets had been notified in January 2026 for the April 2025-March 2026 period. The latest amendment removes those requirements for the two sectors. 

West Asia Conflict Adds to Industry Costs 

The decision comes as businesses face higher operating costs amid the conflict in West Asia. Oil marketing companies have been dealing with increased crude sourcing costs, while passing on the full impact to consumers has remained difficult. 

The textile industry, particularly export-oriented businesses, has also faced pressure from the disruption, according to industry sources cited in the report. 

Iron and Steel Targets Still Await Notification 

The BEE has yet to notify emission targets for the iron and steel sector, one of the country's largest industrial sources of greenhouse gas emissions. 

A draft notification was issued on June 26, 2026, inviting comments from stakeholders. The consultation period ended in late August, but final targets had not been announced at the time of the report. 

Targets for the fertiliser sector have also not been announced. 

How the Carbon Credit Scheme Works 

Under the CCTS, mandatory emission targets were proposed for nine hard-to-abate industrial sectors, using FY24 emissions as the baseline. 

The scheme also has a voluntary mechanism through which eligible entities can register projects that reduce, remove or avoid greenhouse gas emissions. Such projects can qualify for Carbon Credit Certificates. 

Read More: GE Vernova T&D India Share Price Surges Over 3% After Receiving Power Grid Order for 6,000 MW HVDC Project!

Conclusion 

The removal of FY26 emission targets offers temporary relief to refinery and textile units covered by the scheme. However, FY27 targets remain unchanged, while the government is yet to announce targets for some other major industrial sectors. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.