Gujarat on Wednesday launched a market-based trading system to reduce air pollution, where the government sets a cap on emissions and allows industries to buy and sell permits to stay below the cap.
Touted to be the world’s “first” emissions trading system for particulate pollution, the programme is being piloted in Surat as it is a densely populated industrial centre where textile and dye mills release a “significant” amount of air pollution. Going forward, the programme is expected to be used as a model for other parts of India to reduce air pollution and facilitate “robust economic growth”, stated the Energy Policy Institute at the University of Chicago (EPIC) in a release following the move.
The Gujarat Pollution Control Board (GPCB) has teamed up with researchers from EPIC and other institutions like the Harvard Kennedy School, Yale University and the Abdul Latif Jameel Poverty Action Lab to evaluate the programme’s benefits and costs.
“As the first market-based approach to regulating pollution emissions in India, it is expected to drastically reduce air pollution at a low cost to both government and industry and provide best practices for replicating trading schemes to other emissions,” stated EPIC. The emissions trading programme will be experimentally tested to understand its impacts on emissions, industry costs and regulatory costs, it said.
“The history of cap-and-trade programmes also reveals that by unleashing market forces, they greatly reduce the costs that industries incur complying with regulations,” it added.
The programme, first announced in January, takes advantage of GPCB’s earlier innovation of using continuous emissions monitoring systems to track industry emissions in real time. About 350 industries around Surat have installed these systems and now transmit real-time, “high-quality” emissions data.
“With this programme, we are kicking off a new era of cleaner production, while lowering industry compliance costs and rewarding plants that cut pollution in low-cost ways,” said GPCB chairman Dr Rajiv Kumar Gupta. “We believe using this market-based system will prove that rapid economic growth, ease of doing business, and breathing clean air can all be achieved at the same time.”
In 2015, GPCB worked with the same research team to design, test, and implement a new way of carrying out industrial pollution audits, preventing issues arising from third-party auditors being paid by the plants that they are responsible for testing. Globally, cap-and-trade systems have been used to reduce other forms of pollution, such as programmes that have reduced sulphur dioxide and nitrogen oxides in the US.
However, particulate air pollution is “the single greatest threat” to human health globally, stated EPIC. The institute’s Air Quality Life Index, which measures the impact of particulate air pollution on life expectancy, finds that it cuts global life expectancy short by about two years.