What Bureau of Energy Efficiency Clarified at the ICM Capacity Building Workshop

The two-day workshop held on 14 and 15 May 2026 in Mumbai addressed some pressing questions across the compliance market, offset mechanism, and Article 6.2. Here is what matters for obligated entities, project developers, and market participants.

Author: Avadhi Jain

India’s Bureau of Energy Efficiency (BEE) convened a two-day capacity building workshop on 14 and 15 May, bringing together industry participants, project developers, ICM professionals, and sustainability practitioners. The sessions were structured to address both foundational and technical questions, and BEE answered all of them, patiently and without deflection. More workshops of this kind are planned across India.

The most significant outcome was not one clarification but a set of them, across the three tracks that now define India’s carbon market architecture: the compliance market under CCTS, the domestic offset mechanism, and Article 6.2 market under the Paris Agreement. BEE confirmed that these three tracks run in parallel and do not interplay with each other, at least not at this stage.

The three-market structure in ICM –

One of the most common questions coming into the workshop was whether credits from one market can be used in another. BEE answered this directly.

• The compliance market, the offset mechanism, and Article 6.2 operate as three separate and parallel tracks under the CCTS for now.
• Credits created under the offset mechanism cannot be used to fulfill compliance obligations or traded as Carbon Credit Certificates (CCCs) in the compliance market.
• This separation is deliberate – they do not want to flood the compliance market with offset credits, which would undermine the ability of obligated entities to meet their targets by simply buying the surplus credits.
• Corresponding Adjustments (CAs) are issued for Article 6.2 transactions only, not for offset credits. While Offset credits can be sold internationally, these credits will be counted toward India’s NDC, not the buyer’s. Whether a foreign buyer would purchase an offset credit that does not count toward their own NDC is a commercial question each transaction must answer separately.

Key Takeaways for the compliance market-

Cycle and timelines

• The compliance cycle runs annually, not every three years as under the Perform, Achieve and Trade (PAT) scheme. Each year involves data collection, verification, and trading of CCCs.
• BEE expects trading to begin on power exchanges as early as October 2026.
• Monitoring samples must be submitted by July 2026, with no extensions.
• Iron and steel sector targets are expected within one month and will apply to the 2026-27 period. Fertiliser sector targets remain on hold.

GHG scope and price

• Only carbon dioxide and Perfluorocarbons are covered under Compliance market under the CCTS for now. Other GHGs will be revisited in 2027 and 2030 as industry readiness develops.
• BEE is conducting a price discovery exercise for the compliance market and will communicate findings soon. Compliance market CCCs are expected to trade in the range of $10 to $15.

Monitoring and penalties

• Each obligated entity must create its own monitoring plan based on the notification. BEE will not provide one.
• Smaller plants are expected to maintain proper records.
• Penalties under CCTS are collected by Central Pollution Control Board unlike the PAT Scheme.
• The compliance portal will largely replicate the PAT portal. The key difference is the offset component

Key Takeaways for the offset market-

Start date and vintages

• 1 January 2025 is the fixed start date for projects under the offset mechanism. This date is notified and will not change.
• Projects with credits predating January 2025 may individually approach BEE to plead their case. These will be reviewed case by case, but BEE has offered no guarantees.
• Credits with vintages before 2023 are ineligible in all cases. The Energy Conservation (Amendment) Act was enacted in 2023 and cannot operate retrospectively.

Methodologies

• Around 10 methodologies are expected to be in effect by end of May 2025. Approximately 20 will be active within the next two to three months.
• The next methodology in the pipeline covers rice methane. Several others are at the NSCI level; others are further up the approval chain.
• Any stakeholder, including private entities, can submit a methodology to BEE for approval. Both bottom-up and top-down approaches are being tried by BEE.

Participation by obligated entities

• Obligated entities(OEs) can participate in the offset mechanism, but must do so as Non-Obligated Entities (NOEs) through a Special Purpose Vehicle (SPV).
• Any credits generated under the SPV must be excluded from the OE’s gate-to-gate compliance obligations under CCTS.
• Offset credit prices can range from $2 to $150 depending on the project type. Companies can evaluate both markets and choose where a project generates better value.

MRV and project development

• BEE will not prescribe how to conduct MRV. Project developers must design their own monitoring approach and document it in the PDD and Monitoring Plan/Report.
• The QA/QC process must be independently verifiable by a third party.
• The PDD will be published on the ICM portal and opened for public consultation.
• The crediting period is either fixed at 10 years or can have a renewable crediting period of 5 years, subject to revalidation of the project baseline and regulatory surplus.

Article 6.2: separate track, separate process

• Article 6.2 runs parallel to both the compliance market and the offset mechanism. It is not connected to either.
• CAs are issued only for Article 6.2 transactions, not for offset credits.
• No framework document for Article 6.2 has been released yet. BEE confirmed that projects using approved methodologies are eligible. A formal framework and process will be released soon.
• Article 6.2 projects require separate registration on the ICM portal.

ICM portal and trading infrastructure

BEE described the ICM portal as a data management and aggregation system. It is where everything is visible in one place. It is not a trading platform.

• Traders are not permitted on the ICM portal at this stage. To purchase credits, a buyer must register as an NOE buyer.
• Traders can become members of a power exchange and facilitate purchases through that route.
• The workflow is sequential: everything stays on the ICM portal until CCC volume is confirmed. Once volume is certified, it moves to the registry. Trading happens on the power exchange. After settlement, the ICM registry updates on the portal.

ACVAs

• The onboarding of Accredited Carbon Verification Agencies is ongoing. BEE conducts interviews daily.
• BEE has put explicit safeguards in place to prevent the integrity failures seen in the PAT cycle from recurring.

Comparative analysis of the three tracks

The table below summarizes the key structural differences across the three market mechanisms. Refer to the relevant BEE notifications and detailed procedures for full specifications.

Parameter	Compliance (CCTS)	Offset Mechanism	Article 6.2
Who participates	Obligated Entities (OEs)	NOEs, or OEs via SPV as NOEs	Any eligible project developer
Credit type	Carbon Credit Certificates (CCCs)	Offset credits	Internationally transferable credits
Fulfills compliance obligations	Yes	No	No
Corresponding Adjustment issued	No	No	Yes
Counts in buyer’s NDC	N/A	No (counts in India’s NDC)	Yes
GHG scope	CO2 and PFC only	Methodology-dependent	Methodology-dependent
Price range (speculated)	$10 to $15(speculated)	$2 to $150(speculated)	Not disclosed
Start date / vintage	First cycle: 2026-27 targets	1 January 2025 (fixed)	Methodology-linked
Trading venue	Power exchanges	Power exchanges (NOE buyer registration required)	Will be updated on ICM Registry after their separate process for trading.
Penalty authority	CPCB	N/A	N/A
Monitoring plan	Developed by OE	Developed by project developer	Developed by project developer
Crediting period	Annual cycle	10 years (fixed, reassessed)	Methodology-linked
Framework status	Notified	Notified	Pending

This debrief is based on notes from the ICM Capacity Building Workshop held on 14 and 15 May 2026 by BEE. It is intended as a practitioner-facing summary and not as legal advice or a substitute for the official notifications and detailed procedures issued by BEE. Readers should refer to the Detailed Procedure for Compliance Mechanism under CCTS (Version 1.0, July 2024) and the Detailed Procedure for the Offset Mechanism for full specifications.