1

KYOTO PROTOCOL &

STATUTE REGARDING
ENVIRONMENTAL
PROTECTION IN INDIA
Legal Environment Of Business
 Team Members
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 A G Jain
 Anita Prajapati
 Master Govind
 Pooja Chauhan
 Tanisha Singh
 Vikas Jindal
 Content
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 Global Warming & its Implication

 Kyoto Protocol
 Carbon Credit
 Global Trading System
 Indian perspective
 Indian StatutePre Tragedy
 Rule of Strict And Absolute Liability
 Environmental protection Act
 Bibliography
4
 Global Implication
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 The number of hurricanes has almost

doubled in the last 30 years.
 Malaria has spread to higher altitudes
in places like the Colombian Andes,
7,000 feet above sea level.
 The flow of ice from glaciers in
Greenland has more than doubled
over the past decade.
 At least 279 species of plants and
animals are already responding to
global warming, moving closer to the
 Global Implication
6 Contd..
 Deaths from global warming will double
in just 25 years—to 300,000 people a
year.
 Global sea levels could rise by more
than 20 feet with the loss of shelf ice in
Greenland and Antarctica, devastating
coastal areas worldwide.
 Heat waves will be more frequent and
more intense.
 Droughts and wildfires will occur more
often.
 The Arctic Ocean could be ice free in
summer by 2050.
7

e a s o n
Ma i n R
for r s
i s a s t e
h e s e D
T
 Climate Change
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Rapid Industrial Growth

Increased energy consumption

Increased CO2 and other GHG emissions

Global Warming due to increased concentration of

GHG
Changes in
Changes in
Increased Sea wind
Crop
Level and
yields
precipitation
9

Remedial
Measures
 Kyoto Protocol
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 An amendment to the international treaty on

climate change, assigning mandatory targets
for the reduction of greenhouse gas
emissions to signatory nations

 Only Parties to the Convention that have also

become Parties to the Protocol will be bound
by the Protocol’s commitments.
(by ratifying, accepting, approving, or
acceding to it)

 183 countries and one regional economic

integration organization (the EEC) have
 Time-Line
11
 May 1992: UN FCCC* establishes framework for containing
global warming
 Dec 1997: Following intense negotiations in Kyoto (Japan), a
protocol is agreed upon by over 100 countries
 Feb 2005: 141 countries, including EU, Japan, Canada, and
Russia sign the Kyoto Protocol and it gets ratified w.e.f. 16-
Feb-05
– The US remains a key non-signatory
 The Kyoto Protocol sets legally binding targets for reducing
green house gases (GHGs)
– Developed countries have a target to reduce GHG emissions by 5.2%
below 1990 levels, by year 2012
– EU members committed to reduce their average emissions by 8 %
– India, China, and Brazil are classified as emerging countries and hence
exempted from this protocol
 Green House Gases
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 Green house gases (GHGs) are gases that result in

global warming
 Degree of warming caused by a specific GHG depends
upon its CO2 equivalence (CO2e)
 6 GHGs are regulated under the Kyoto Protocol
– Carbon dioxide (CO2)
– Methane (CH4)
– Nitrous oxide (N2O)
– Hydrofluorocarbons (HFCs)
– Perfulourocarbons (PFCs)
– Sulphur Hexafluoride (SF6)
 There are at least 25 other gases, including chloroform,
CO, and water vapour that influence climate-change
 Above-mentioned six are key ones, that can be controlled
by human intervention with relative ease
 Global warming potential
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 Global warming potential (GWP) for the 6 GHGs are

summarised below:
GHG : Global Warming Potential
 Hydrofluorcarbons (HFCs) : 140 – 11,700
 Perfluorcarbons (PFCs) : 6500 – 9,200
 Methane : 21
 Nitrous oxide : 310
 Sulphur hexafluoride : 23,900
 Carbon dioxide : 1

 GWP is the global warming impact that a GHG would

have over a 100-year timeframe
– By definition, CO2 is used as the reference benchmark,
with GWP of 1
14
 CARBON CREDIT
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 Carbon credits are certificates issued to

countries that reduce their GHG emissions
One credit = 1 tonne of CO2 (or CO2 equivalent)
reduced
 Surplus credits result when a country
overshoots its reduction target
– These can be traded, with countries
facing a shortfall in target able to buy and
meet their targets
– Carbon credit trading encourages
emission reduction, provides financial
 Kyoto Protocol Mechanism
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 The Protocol allows developed countries

to reach their targets in different ways
through “Flexibility Mechanism”

 JointImplementation (JI)
 Clean Development Mechanism (CDM)
 Emission Trading (ET)
 K P Mechanism Contd..
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UNFCCC KP

PROJECT ALLOWANCE
BASED BASED

CDM
JI (Between IET (Between
(Developed &
Developed Developed
Developing
Countries) Countries)
Countries)

Carbon Emission Assigned

Reduction Reduction amount
Units (CER) Units (ERU) units (AAU)
 1.International Emission
18 Trading K P Mechanism Contd..

 Emissions trading (ET) is a mechanism that

enables countries with legally binding emission
targets to buy and sell emissions allowances
among themselves

 Each country has a certain number of emission

allowances (amount of carbon dioxide it can emit)
in line with its Kyoto reduction targets

 The IET allows industrialized countries to trade

their surplus credits on the international carbon
credit market
 2. Clean Development
19 Mechanism K P Mechanism Contd..

Technology
Transfer & project
Financing

Developed Developing
Countries CDM Countries

Carbon Credits
 CDM Cont..
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 The purpose of CDM is reduce to

emissions and also contribute to
sustainable development in developing
countries
 The CDM is administered by the CDM
Executive Board (CDM Board) which
reports and is accountable to the
Conference of Parties (COP).
 A Carbon emission reduction (CER) is
given by the CDM Executive Board
 One CER is equivalent to one tonne of
 CER – Source of Generation
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 Industries like
 Agriculture
 Energy (renewable & non-renewable
sources)
 Manufacturing
 Metal production
 Mining and mineral production
 Chemicals
 Afforestation & reforestation
 3. Joint Implementation
K P Mechanism Contd..
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 Projects between industrialized nations to

earn emission offsets
 It is done because of geographical or cost
implications
 Emission reduction units (ERUs) created
through joint implementation is treated in
the same way as those from emissions
trading
23

GLOBAL TRADING SYSTEM

 European Union Emission Trading
Scheme
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 The European Union Emission Trading

Scheme (EU ETS) is the largest
multinational, greenhouse emissions
scheme in the world. It commenced
trading in 2005

 Under Kyoto EU committed to reduce 8%

1990 levels of emissions in 2008 to 2012
 EU ETS Cont..
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 The Kyoto protocol sets targets to

countries
 The States list down the amount and
method of allocating allowances to
facilities under NAP
 The total allowances granted = Kyoto
target
 Determinants of demand
 Volumes are tracked by National
registries
26

Indian
Scena
rio
 How Carbon Credit works?
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An Example:
 British Petroleum in UK emitting more

than the accepted norms of UNFCCC

 Tie up with Subsidiary in India or China

Under CDM
 The credits arising out of the use of the

new technology are sold to counterparts

in Europe
 Thus a carbon credit market is created
 Carbon trading in India
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 Bilateral trade
 No fixed norms of emission reduction by
government.
 Potential Participants
 Registry
 Carbon Trading in India
29 cont..
 Multi Commodity Exchange of India Ltd.
( MCX) entered into a strategic alliance
with CCX in September 2005 to initiate
carbon trading in India.
 Offers Mini version of ECX CFI & CCFE SFI
 The tie-up would provide immense scope
and opportunity for domestic suppliers to
realize better prices for their carbon
credits
 India being a major supplier of carbon
credits, the tie-up between the two
 India’s potential
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 India – Non Annexure I country, has a large scope in

emissions trading
 India and china together contribute to $5 billion of the
global carbon trade estimated at $30billion
 It is one of the leading generators of CERs through CDM
 Analysts forecast that its trading in carbon credits
would touch US$ 100 billion by 2010
 Currently, the total registered CDM projects are more
than 300, almost 1/3rd of the total CDM projects
registered with the UNFCCC
 The total issued CERs with India as a host country till
now stand at around 34 million, again around 1/3rd of
the total CERs issued by the UNFCCC
 Benefits of Carbon Trading
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 Sellers and intermediaries can hedge

against price risk
 There is no counterparty risk as the
Exchange guarantees the trade
 The price discovery on the Exchange
platform ensures a fair price for both the
buyer and the seller
 Players are brought to a single platform,
thus eliminating the laborious process of
identifying either buyers or sellers with
enough credibility
32

Provisions in Indian Statute

Regarding protection of Environment
 Bhopal Gas Tragedy
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 In city ‘Heart Of India’ named Bhopal

 UCIL..
 Exposing 520,000 people to toxic gases..
 Over 22,000 people died..
 Due to:The use of hazardous chemicals (MIC) instead of
less dangerous ones
 Storing these chemicals in large tanks instead of several
smaller ones
 Possible corroding material in pipelines
 Poor maintenance after the plant ceased production in the
early 1980s
 Failure of several safety systems (due to poor
maintenance and regulations)
 Leads to:
 Pre Tragedy Indian Statute
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 The Water (Prevention and control of

Pollution) Act, 1974
 The Air (Prevention and control of
Pollution) Act, 1981
 Forest Conservation Act, 1980
 The Wild Life Protection Act, 1972
 Rule Of Strict liability
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 Formulated by House of Lords in 1868

 Continues to be in Force in India under
Article, 372 of Indian Constitution
 Available under Law Of Torts
 Rylands vs. Fletcher Case
 Construction of Reservoir through independent
Contractor
 Old Disused Shaft were neglected on the site
 Resulting in flooding the adjacent coal mine with
water
36

 The Rule:
 “If
a person brings on his land anything
which is likely to do Mischief if it escapes, He
will be Prima Facie answerable for the
damage cause by its escape even though he
was not negligent”.
Rule to be Applicable
 Dangerous things
 Escape
 Non Natural use of land
37

 Exception to Strict Liability:

 Plaintiff’sOwn Default
 Act Of God
 Consent of the Plaintiff
 Act of third Party
 Statutory Authority
 Post Tragedy : Rule of Absolute
38
Liability
 Due to failure of Rule of Strict Liability for
its exception
 M. C. Mehta vs Union of India case.
 By Supreme Court in 1987
 The Rule:
 “When an enterprise is engaged in a
hazardous or inherently dangerous industry
which posses a potential threat to the health
and safety of people, it owes an absolute
and non-delegable Duty to ensure that no
harm results to anyone from such activity”.
 Environmental Law &
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Consitution Of India
 Specific Provision for Environmental
protection
 Article 19(1)(g)3
 Article 214
 Article 475
 Article 48A6
 Article 51A(g)7
 THE ENVIRONMENT
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(PROTECTION) ACT, 1986
 Scope and Scheme of the Act
 Come into force on 19 Nov 1986
 Extends to whole of India
 Fixes responsibility on person’s carrying on
Industrial operations or Handling Hazardous
substances
 To comply with certain Safety norms for
prevention, control and abatement of
Environmental pollution.
 Granted power to Central Govt. for
environmental protection
 Bibliography
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 http://www.bbcnews.com
 http://www.ssrn.com
 http://www.karvy.com
 http://www.headwaycapitaladvisor.com
 http://www.baker&mckenzie.com
 http://www.ccnnews.com
 Economic Labour & Industrial law by ICSI
 Economic law by V.S.Datey
42

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