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Tag: #EmissionsTrading

  • Gujarat emissions model goes global as Rio launches first South America market

    Gujarat emissions model goes global as Rio launches first South America market

    The state of Gujarat, an Earthshot Prize 2025 finalist, is taking its pioneering emissions trading model global through a new partnership with the City of Rio de Janeiro, Brazil.

    The Emissions Market Accelerator (EMA) will help Rio explore South America’s first particulate matter emissions market, adapting proven lessons from India to cut pollution while supporting economic growth.

    The announcement was made at The Earthshot Prize Impact Assembly, co-hosted with Bloomberg Philanthropies during London Climate Action Week.

    “The Rio de Janeiro City Hall is taking a bold step forward in spearheading this innovative approach to reducing pollution,” said EMA Co-Chair Michael Greenstone, Milton Friedman Distinguished Service Professor in Economics at the University of Chicago.

    “We are thrilled to work with government leaders to ensure this market successfully reduces pollution while fostering continued economic growth.”

    Once launched, Rio’s emissions market would be the first of its kind in South America.

    Gujarat’s groundbreaking work on market-based pollution control spurred the launch of the Emissions Market Accelerator. The state has since launched a second market and is developing two more for sulfur dioxide and wastewater pollution. The EMA is also working with other Indian states and expanding globally.

    “This partnership with Rio marks an exciting step toward globalizing the success of market-based pollution control,” said Kaushik Deb, Executive Director of the EMA. “In Gujarat, we demonstrated that emissions trading can dramatically reduce pollution without compromising industrial productivity. Now we can take those lessons global.”

    Eduardo Cavaliere, Mayor of Rio de Janeiro, said: “Rio de Janeiro is proud to partner with the Emissions Market Accelerator (EMA) to bring market-based solutions to air pollution in South America for the first time. Gujarat’s emissions trading scheme, recognized by the Earthshot Prize, proves cities can harness innovative tools to protect people and the future.”

  • Eco Survey 2025-26: Pollution trading schemes can be a game-changer even in developing countries, Surat pilot proves

    Eco Survey 2025-26: Pollution trading schemes can be a game-changer even in developing countries, Surat pilot proves

    Market-based tools like emissions trading — long hailed as successful in the US and Europe — can deliver big wins for cleaner air in developing nations too, the Economic Survey 2025-26 has asserted, citing a pioneering experiment in Gujarat’s Surat city.

    Traditionally, experts doubted whether pollution trading schemes could work in lower-capacity settings due to weak monitoring, limited enforcement, and low state credibility. Regulators often struggle to track emissions accurately or ensure polluters buy permits for every unit released.

    But the Survey points to strong counter-evidence from the world’s first particulate matter emissions trading market, launched in Surat — a major industrial hub — and evaluated in the seminal 2023 study by Greenstone et al.

    The scheme, run by the Gujarat Pollution Control Board, covered 317 large industrial plants (mostly coal-burning units in textiles and other sectors). It replaced old command-and-control rules (tech mandates and concentration limits) with a cap-and-trade system, backed by mandatory Continuous Emissions Monitoring Systems (CEMS) for real-time tracking of particulate emissions.

    Key findings from the randomised trial:

    The market worked smoothly — active trading took place, and plants achieved near-universal compliance (99% of emissions covered by permits vs just 66% under the old regime).

    Participating factories slashed particulate emissions by 20-30% compared to those under traditional regulation.

    For the same pollution level, abatement costs dropped by 11-14%, thanks to firms trading permits based on their differing marginal costs.

    The Survey calls this a breakthrough proof that, with credible real-time monitoring like CEMS in place, pollution trading schemes can achieve major emissions cuts at much lower compliance costs — even in challenging developing-country contexts.

    “This shows market-based environmental regulations are not just for rich nations. When supported by strong tech-enabled enforcement, they offer an effective and cost-efficient path to cleaner air,” the document notes.

    The Surat pilot has already inspired expansions in Gujarat (including Ahmedabad) and discussions in other states, highlighting its potential as a scalable model for tackling industrial air pollution across India.