Railways line up five carbon credit projects

Rlys to appoint consultants to advise it on the issue.

In what will be an alternative revenue source from its non-core operations, Indian Railways plans to tap its massive carbon credit potential. To start with, it has identified five projects that will result in lower carbon emissions.

Carbon credits are tradeable commodities that can be sold to countries with high emissions. The ministry expects a revenue of Rs 16-17 crore per year initally, a figure that may go up as more projects are taken up.

The Railways plans to appoint consultants to advise it on the issue. After getting carbon credits ratified by designated authorities, they can be sold to any country or company interested in buying them.

"We have identified the projects and are in the process of selecting consultants for advising us on their revenue potential," a ministry official said.

Ernst & Young has already been invited to make a presentation. "There is a huge potential as the Railways has undertaken large-scale electrification, which results in lower emissions than when trains are run on diesel," another official said.

The Railways has taken a leaf out of the German vendor Siemens' book. The company proposes to use railways' projects it is executing in Mumbai to earn revenues from carbon credits.

Railways and Siemens are expected to share the revenues equally. The project involve regeneration of energy for running trains.

Encouraged by the response from private companies, the department has now gone ahead and identified some projects on its own, including its biodiesel venture and usage of gas-driven locomotives in sub-urban areas.

The Railways uses 14 per cent biodiesel mixed with diesel in Southern Railways, which results in reduced carbon emissions.

In addition, the conversion of liquid fuel-based locomotives to gas-driven ones also lead to lower pollution levels, ministry officials pointed out.

The ministry also plans to revive two electrification projects on Delhi-Gurgaon and Ghaziabad-Meerut-Saharanpur route. "These projects were rejected due to low rate of return," an official said.

He said the ministry hoped to bridge the gap in rate of return through revenues from selling carbon credits. The ministry will also consider energy efficiency works in the Eastern Railway workshop.

The concept of carbon credits is significant due to reduction of carbon emission obligations set by Kyoto Protocol on developed countries, effective from February 2005. If a country is unable to attain its emission targets, it can buy carbon credits to meet its obligations.