Carbon Credits for Paper and Pulp industry

Posted on January 20, 2011 by

Paper and pulp industry in India

The Indian Paper Industry is a booming industry. Presently there are about 515 units engaged in the manufacture of paper and paperboards and newsprint in India. The country is almost self-sufficient in manufacture of most varieties of paper and paperboards. To meet part of its raw material needs the industry has to rely on imported wood pulp and waste paper. India’s annual production of paper & paperboard is around 40 lakhs tonnes. At present about 60.8 % of the total production is based on non-wood raw material and 39.2 %   based on wood.

High demand of Pulpwood, Water and Energy makes paper and pulp industry an industry with significant ecological footprint. The paper and pulp sector is one of the energy intensive and extremely polluting sectors within the Indian economy. Sectors with similar footprint are Aluminium, Cement, Fertilizer, Iron and Steel, and Glass. Together they consume 38.8% of all fuels consumed in the manufacturing sector. Due to its high dependence on natural resources Paper and pulp industry is contributing to high GHG emission and subsequently into climate change.


Paper and pulp industry: Benefiting from Climate Change and CDM

Paper and pulp industry is the main consumer of Pulpwood. Streams of forest and plantation management science such as Agro-forestry, Farm forestry are emerging rapidly to create enough sources of the timber and other forest products for meeting industry’s ever growing need. Managing plantations under controlled conditions and making them productive is first priority of the Paper and pulp industry. This has now resulted in large managed forest lands and community based agro-forestry projects.  Many agro-forestry project developers are interested in earning carbon credits for their forestation activity for the carbon dioxide removed (sequestered) from the atmosphere.

However, given the complexity of forests, forest lands rights etc, the guidelines of the CDM-EB consider only afforestation and reforestation projects for earning carbon credits.

Relevant Rules and Regulations

Forests have been defined in different ways in different countries and regions taking into consideration differences in species and local ecosystems. Globally, forests are defined as land areas covered with wooden species that surpass the forest threshold: min. 10-30% crown cover, minimum height 2-5 m, minimum area 0.05 ha-1.00 ha. (More)

Parameters to be considered for forestry carbon project

  • Land applicability conditions (Whether land is agricultural, semi forest, arid, etc.)
  • Tree planting plan including Nursery management, Site preparation, etc
  • Forest management practices
  • Displacement of pre project activities e.g. Grazing, Settlement, etc
  • Intercropping  with any other commercial crops within the array of main plantations
  • Selection of carbon pools – above ground and below ground biomass
  • Sources of GHG emission other than selected carbon pools
  • Assessment of socio economic impacts and the environmental impacts
  • Crediting period – Max of 20 years renewable twice or fixed i.e. 30 years.)
  • Certified Emission Reduction ( CER)- tCER’s/lCER’s


A successful A/R CDM projects results into emission reductions (carbon credits). These are divided into two forms

  1. tCERs : Temporary Certified Emission Reduction. These are issued till 2012.
  2. lCERs : Long term Certified Emission Reduction. These are issued till crediting period as selected by the project proponents.

Eligibility conditions for forestry projects also include the following;

  • Any native species to the region are eligible for carbon sequestration project. Besides this, the species planned for plantation can not be cash forest crop. (e.g. Tectona Grandis-Teak)
  • There is no stipulated ‘minimum land area requirement’. However, to justify the transaction costs of validation , verification and project development expenses, land area of more than 100 hectares is considered feasible.

Plant species for the paper and pulp industry

  • Eucalyptus tereticornis – Popularly known as Eucalyptus hybrid or Mysore Gum
  • Eucalyptus camaldulensis – Popularly known as ‘River Red Gum’ due it’s habitat on the banks of river bed or flood prone area
  • Eucalyptus globules
  • Acacia auriculiformis – Dry tropical lowlands in the humid and sub-humid zones, MAR: 700-2000)
  • Gmelina arborea (Popularly known ‘Gamhar’ also used in matchwood industry)
  • Callicarpa arborea
  • Ficus fistulosa
  • Populas tremula

Know more about A/R CDM project developed by Papers Division, Unit: Bhadrachalam of ITC Limited

Know more about India’s first reforestation (A/R) CDM Project



  • Economy watch website
  • Schumacher.K & Sathaye.j., July 1999., “Energy Analysis Program Environmental Energy Technologies Division Lawrence Berkeley National Laboratory Berkeley, CA 94720”
  • UNFCCC Web Site



Posted in: Carbon Markets