Examining the Success and Price of Carbon Credits in the Livestock Sector in India

This research investigates whether methane mitigation measures in India’s livestock sector can be financially viable within voluntary carbon markets. The study addresses the dual challenge of reducing livestock-related greenhouse gas emissions—especially methane—while ensuring the economic feasibility of interventions for smallholder farmers and cow shelters. Using a robust quantitative framework based on 10,000 Monte Carlo simulation runs, the paper evaluates four major mitigation strategies: biogas digesters, ration balancing, Harit Dhara supplements, and selective breeding. Data inputs are drawn from national sources such as the NDDB, ICAR, MNRE, and multiple pilot programs across India.

The analysis constructs a Marginal Abatement Cost Curve (MACC) to compare intervention costs with existing carbon credit market prices in India. The findings reveal a clear cost-performance hierarchy: biogas digesters (~₹440/tCO₂e) and selective breeding (near-zero or net-negative costs) emerge as the most financially attractive and scalable interventions, while ration balancing (~₹770/tCO₂e) remains viable under certain regional conditions. In contrast, Harit Dhara supplements, at approximately ₹7,500/tCO₂e, are economically unfeasible without targeted subsidies. The study emphasizes that aggregation models and digital Monitoring, Reporting, and Verification (MRV) systems could significantly reduce costs and improve scalability, particularly for smallholder systems.

By integrating economic modeling, empirical field data, and carbon market analysis, the paper provides policymakers with a decision framework for prioritizing low-cost, high-impact interventions in the livestock sector. It highlights how aligning methane mitigation strategies with the voluntary carbon market can mobilize climate finance, enhance rural incomes, and accelerate India’s broader transition toward sustainable agriculture. The research thus bridges environmental policy and rural economics, proposing practical, data-driven pathways to achieve both emission reduction and economic resilience in one of India’s most critical sectors.