The Indian government has released the methodology for calculating Green Credit for tree plantation, linking it directly to canopy density, a move set to revolutionize how environmental contributions are recognized and incentivized. This initiative, under the Green Credit Programme (GCP), marks a significant shift from simply counting trees planted to assessing the actual ecological impact of those plantations.

The core of the new methodology lies in granting Green Credits only after a minimum of five years of restoration activities and upon achieving a minimum canopy density of 40%. Canopy density refers to the overhead layer of tree crowns covering a certain percentage of the ground area. This ensures that credits are awarded for successful and sustainable afforestation efforts, rather than just the act of planting. One Green Credit will be awarded for each surviving tree older than five years, provided the 40% canopy density is reached. This approach aims to promote the development of healthy, dense, and ecologically valuable forests.

The Green Credit Programme, launched in October 2023, is a market-based mechanism designed to incentivize voluntary environmental actions across various sectors. It aligns with the Lifestyle for Environment (LiFE) movement, proposed by Prime Minister Narendra Modi, encouraging sustainable lifestyles and community-driven behavioral changes toward environmental friendliness. The program encompasses activities like tree plantation, water conservation, sustainable agriculture, waste management, reducing air pollution, mangrove conservation, promoting eco-friendly products (Eco Mark), and sustainable building and infrastructure.

Under the new rules, the Green Credit generated for compensatory afforestation or tree plantation is non-tradable and non-transferable, except within a holding company and its subsidiaries. These credits can be exchanged once to meet compensatory afforestation requirements for diverting forest land for non-forestry purposes or to fulfill Corporate Social Responsibility (CSR) obligations based on the cost incurred for forest restoration. They can also be used to meet tree plantation obligations required for project approvals.

For industries, cooperatives, and other entities to earn Green Credits, the rules specify that the minimum canopy density of 40% must be achieved in the degraded forest land parcel. The Green Credit is calculated based on vegetation status, including changes in canopy density and the number of surviving trees. This methodology aims to address concerns about the effectiveness and environmental soundness of previous approaches.

The government's approach emphasizes a comprehensive land bank accessible through a dedicated web portal, where degraded forest lands are registered by forest departments. Individuals and entities can finance afforestation activities on these lands in exchange for Green Credits. The Indian Council of Forestry Research and Education (ICFRE) administrates the program, with state forest departments undertaking afforestation activities and communicating the costs. Green credits are issued two years after planting, following an evaluation by the ICFRE.

Measuring canopy density can be achieved through various methods, including ground-based techniques and remote sensing. Ground-based methods involve instruments like the LI-COR LAI-2000, AccuPAR ceptometer, CID digital plant canopy imager, hemispherical photography, spherical densiometer, and point sampling. Remote sensing techniques use satellite imagery to estimate crown coverage over large areas. The choice of method depends on factors like cost, accuracy requirements, and the scale of the assessment.

The Green Credit Programme is a significant step towards promoting environmental stewardship by incentivizing positive environmental actions. By linking Green Credits to tangible outcomes like canopy density, the government ensures that tree plantation efforts contribute to genuine ecological restoration and enhanced biodiversity. This innovative approach aligns environmental responsibility with economic benefits, driving India towards a sustainable and environmentally responsible future.