Decarbonisation of the Industrial Sector Through Greenhouse Gas Mitigation, Offset, and Emission Trading Schemes

Abstract

Several nations have adopted a tax or market-based carbon pricing system, typically involving low price rates, inadequate emissions coverage, and price reductions for particular industries. The main driver of climate change and global warming is greenhouse gas (GHG) emissions, which include carbon dioxide. The drive to reduce carbon emissions and offset carbon is critical to industrial decarbonisation and achieving the net zero goal. This paper investigates two key actions to reduce carbon emissions: switching to low-carbon alternatives and carbon offset. The emission trading scheme (ETS) mechanism is a market-based pollution-control strategy that provides economic incentives to reduce emissions. This framework, also known as a cap and trade system or allowance trading, has the potential to reduce emissions by establishing a pollution limit and creating a market for each country. The use of the ETS in the waste-to-energy industry demonstrates the framework’s applicability. It has been shown that a well-designed ETS can be both environmentally and economically sound as a driver of the low-carbon economy transition. It will be highly beneficial to the industry because it will provide precise emission monitoring, harsh penalties for violations, and high compliance.