The Energy Policy Institute at the University of Chicago Trust (EPIC India) hosted a workshop with Indian members of the Parliament to discuss the potential of pollution markets in solving India’s air pollution problem. The event had researchers from the University of Chicago and industry representatives share learnings from the emissions trading scheme (ETS) that Gujarat Pollution Control Board rolled out in Surat in 2019.

At the core of the workshop, it was discussed how it is important that India identifies regulatory instruments, such as the Surat ETS, that will deliver better environmental outcomes without hindering economic activity.

The event was attended by six Hon’ble Members of Parliament: Shri Gaurav Gogoi (Member of Lok Sabha), Shri Dhal Singh Bisen (Member of Lok Sabha), Shri Shyam Singh Yadav (Member of Lok Sabha), Shri Hasnain Masoodi (Member of Lok Sabha), Shri Pradyut Bordoloi (Member of Lok Sabha) and Shri Abdul Khaleque (Member of Lok Sabha). The workshop also saw the presence of Industry representatives, and officials from the government of Gujarat, among others.

Welcoming the policymakers and underlining the necessity of working together with them, Dr. Balaji Srinivasan, Advisor-EPIC, highlighted EPIC India’s commitment to improving the capacity of key stakeholders in India’s policy ecosystem on crucial energy and environment challenges.

Setting the context of the importance of action-driven solutions, Ms. Mary Tyler Holmes, Deputy Director, Indo Pacific Office– USAID spoke about how cleaner air can lead to better health and how we must ensure through our joint effort to work towards improving air quality and saving lives. She added how air pollution has an impact on millions of lives and policies that need to be delivered need to be supported by regulations.

Parliamentarian Shri. Gaurav Gogoi shared the open remarks and shed light on how as parliamentarians, it is our shared responsibility to raise awareness around air pollution and take adequate actions to ensure that the health of our citizens is not compromised. He said, “We need to come up with smarter solutions for industrial pollution. And one such emerging possible solution is the Emissions Trading Scheme. This experiment from Surat looks at having a collaborative approach with industries and we are keen to see how other states can learn from this Gujarat experience.”

Ms. Sanjana Gorti, Senior Research Manager from JPAL South Asia, spoke on the cap-and-trade system and the main factors in the ETS project’s success—the selection criteria for industries during the pilot, the CEMS infrastructure, and how emissions are monitored—in Surat, Gujarat. She also drew attention to the partnership with the Gujarat Pollution Control Board, without which the program would not have been successful.

In one of the workshop’s knowledge sessions, Michael Greenstone, Director of EPIC and one of the project’s principal researchers, discussed the role of markets in pollution mitigation and how the Surat ETS saw a significant decrease in air pollution accompanied by lower industry spending on pollution abatement technologies.

He answered some critical questions like what problems can excessive emissions cause and insights from the world’s first emissions market for PM in Surat. Sharing about the results of ETS, he added, “The trading of pollution permits among the industries participating in the Surat ETS led to a reduction in air pollution in the Surat industrial cluster in the range of 20-30%.”

Apart from these, industry representative Shri Jitubhai Vakharia, President-SGTPA shared his experience being part of the first ETS alongside Michael Greenstone in a panel discussion moderated by NDTV Senior Managing Editor Chetan Bhattacharji. Some of the key things discussed were how can industries be convinced to adapt and be part of a pollution market and can the ETS offer a pathway to achieving our net-zero goals. What will it take to roll out S02 markets in a landscape like India? Etc.

The event gave an insight into the work of EPIC on markets and market-based solutions, the health impact of air pollution, as well as the Legislators Program, while discussing the role of parliamentarians in using available platforms to inform the policy landscape.