corporate law
On February 22, 2024, the Ministry of Environment, Forest and Climate Change issued a notification outlining the methodology for calculating green credit related to tree plantation. This article examines the detailed process as stipulated under the Green Credit Rules, 2023.
The Forest Departments of States and Union Territories are responsible for identifying degraded land parcels suitable for tree plantation. These include:
These areas play a vital role in enhancing the country's green cover.
The identified parcels must be free from encumbrances and measure at least five hectares in size.
Individuals or entities wishing to engage in tree plantation for Green Credit must submit an application to the Administrator.
Upon receiving the application, the Administrator assigns the identified land to the applicant. The applicant must then submit a detailed proposal for tree plantation, describing the intended plan for generating Green Credit.
The Administrator will provide a demand note to the applicant, detailing the costs involved, including administrative expenses.
Following payment, the Forest Department will proceed with the tree plantation according to the established management plan. The plantation must be completed within two years of the payment date.
After completing the tree plantation, the Forest Department will submit a report and issue a certificate of completion to the applicant.
The Administrator will review and verify the tree plantation activities. Green Credit will be awarded based on the total number of trees planted and the associated completion certification.
Green Credit is calculated at a rate of one credit per tree, provided a minimum density of 1,100 trees per hectare is achieved, depending on local conditions.
In accordance with sub-rule (1) of Rule 5 of the Green Credit Rules, 2023, the Central Government, upon the Administrator's recommendation, hereby notifies the following methodology for calculating green credit concerning tree plantation:
The Forest Department of each State and Union territory shall identify degraded land parcels, including open forests, scrub land, wasteland, and catchment areas, which will be made available for tree plantation to enhance the country's green cover and generate Green Credit as outlined in these Rules.
Identified land parcels must be encumbrance-free and consist of areas no less than five hectares.
Any person or entity wishing to undertake tree plantation for Green Credit generation may apply to the Administrator.
Upon receiving the application, the Administrator shall identify applicable land and allocate it to the applicant, who must then propose a tree plantation plan for Green Credit generation.
Once the proposal is received, the Administrator will issue a demand note specifying the cost of tree plantation and any administrative expenses to be paid within the timeframe provided.
The applicant is required to pay the specified amount to the Administrator within the noted deadline using a bank draft or approved payment method.
Following payment, the Forest Department shall be instructed by the Administrator to execute the tree plantation in accordance with the management plan, and it must be completed within a two-year period from the payment date.
Upon completion, the Forest Department will submit a report to the Administrator, along with a certification of completion to the applicant.
Following evaluation of the report, the Administrator may generate and issue Green Credit based on the number of trees planted on the assigned land and the completion certification provided.
Green Credit will be calculated at one credit per tree planted, subject to a minimum density of 1,100 trees per hectare, determined by local silvi-climatic and soil conditions, based on certification from the Forest Department.
Generated Green Credit may be exchanged for compliance with compensatory afforestation when forest land is diverted for non-forestry purposes as per the Van (Sanrakshan Evam Samvardhan) Adhiniyam, 1980.
The Green Credit generated may also be utilized for reporting under environmental, social, and governance indicators or as part of corporate social responsibility initiatives under applicable laws.
Understanding the methodology for calculating green credit in tree plantation is crucial for promoting environmental sustainability. The guidelines established by the Ministry offer a transparent process that supports afforestation efforts and serves various environmental and corporate responsibilities. Staying informed and engaged is vital for fostering a greener future.