Comprehensive assessment of carbon market potential in India: a case study of prominent energy and power majors

Abstract India targets a 50 % renewable energy share and a 45 % reduction in carbon intensity by 2030, compared to 2005 levels, while still relying on fossil fuels for 50 % of its energy needs. With the energy and power sectors being the primary sources of India’s CO2 emissions, exploring the carbon market’s potential in these sectors is crucial. This study adopts a holistic approach, combining qualitative and quantitative methods. The qualitative analysis reviews global carbon trading systems to assess opportunities and challenges, focusing on India’s carbon trading market. The quantitative analysis uses emission data from leading energy and power companies to estimate the carbon market size, projecting a range of USD 18.22 million to USD 6.62 billion for energy companies and USD 100.75 million to USD 36.58 billion for power companies by 2030. The study provides a roadmap for establishing a carbon market in India, including capacity building, emission reduction strategies, carbon credit ranking, and policy recommendations, helping industries to assess their carbon market potential. This study presents a novel and crucial analysis in the context of India’s evolving energy sector and the global drive toward carbon neutrality. Unlike previous studies, which often focus on broader policy frameworks or general emissions data, this article uniquely centres on the specific roles and opportunities within India’s leading energy and power companies, offering a focused, real-world perspective on carbon market engagement.