Renewable Energy Certificate (REC) Mechanism

Central Agency

National Load Despatch Centre(NLDC)

Shailendra Kr. Verma

Chief Manager

National Load Despatch Centre(NLDC)

skverma@posoco.in

4

Policy and regulatory Framework : Enabling Provisions

Electricity Act, 2003

The EA 2003 has outlined several enabling provisions to accelerate the

development of RE based generation:

(Section 3): National Electricity Policy and Plan for development ofpower system based on optimal utilization of resources includingrenewable sources of energy.

(Section 61(h)): Tariff Regulations by Regulatory Commission to beguided by promotion of generation of electricity from renewableenergy sources in their area of jurisdiction.

(Section 86(1)(e)): Regulatory Commission to Specify PurchaseObligation from renewable energy sources.

(Section 66): Appropriate Commission shall endeavor to promote thedevelopment of market (including trading) in power in such a manneras may be specified and shall be guided by National Electricity Policy inSec 3.

5

• Section 86(1): The State Commission shall discharge the following functions, namely:

(e) promote cogeneration and generation of electricity from renewable sources of energy by

providing suitable measures for connectivity with the grid and sale of electricity to any

person, and also specify, for purchase of electricity from such sources, a percentage of

the total consumption of electricity in the area of a distribution licensee;

• Various State Commissions have put significant emphasis on the last part of this important

clause while developing regulations for Distribution Licensees under their jurisdiction

Policy and regulatory Framework : Enabling Provisions

RPO Trajectory notified by Ministry of Power

Long-term

Trajectory2016-17 2017-18 2018-19 2019-20 2020-21 2021-22

Non-solar 8.75% 9.50% 10.25% 10.25 % 10.25 % 10.50 %

Solar 2.75% 4.75% 6.75% 7.25 % 8.75 % 10.50 %

Total 11.50% 14.25% 17.00% 17.50 % 19.00 % 21.00 %

Target of 175 GW of Renewable Energy

National Action Plan on Climate Change (NAPCC)

Policy and regulatory Framework : Enabling Provisions

• Under the New Tariff Policy 2016, development of renewable energy has been given aspecial consideration

– New tariff policy, stipulates that State Commissions shall fix year wise RPO targets taking intoconsideration availability of resources in the region and its impact on retail tariff.

– Long term growth trajectory to be prescribed by MoP in consultation with MNRE. Withinoverall RPO percentage target, SERCs to reserve percentage for solar RPO to reach 8% by 2022

– It is desirable that purchase of energy from renewable sources of energy takes place more orless in the same proportion in different States. Hence, it prescribes adoption of RECmechanism to meet the purchase obligation in scenario of RE potential restricted to certainparts of the country

– Appropriate Commission may also provide a suitable regulatory framework for encouragingsuch other emerging renewable energy technologies by prescribing separate technologybased REC multiplier, vintage based multipliers.

– Renewable Generation Obligation (RGO)- New coal/lignite based thermal plants afterspecified date to also establish/procure/purchase renewable capacity

– In order to promote renewable energy capacity addition, there will be No inter-Statetransmission charges and losses to be levied for solar and wind power.

Draft Electricity (Amendment) Bill 2018

• “Renewable Purchase Obligation” means such minimum percentage of the purchase of

electricity from Renewable Energy Sources to be procured by every obligated entity in a manneras may be prescribed by the Central Government from time to time;

• “Renewable Generation Obligation” means the Renewable Energy Generation capacity

required to be established or its equivalent capacity required to be procured from RenewableEnergy Sources or any instrument representing renewable energy, as the case may be, and saleof such energy along with the electricity generated from the coal or lignite based thermalgenerating station, by a generating company establishing a coal or lignite based thermalgenerating station;

• Trajectory to be notified by central Government

• National Renewable Energy Policy

• Penalty for non-compliance of RPO - ₹ 1 - 5/unit

Policy and regulatory Framework : Enabling Provisions

6

Jun’08 FOR initiated study for increasing RE Share and feasibility of REC

Jun’08 NAPCC recognized market instruments as tool to promote RE

Oct’ 09 FOR approved Model REC Regulations

Jan’10 CERC notified REC Regulations

Jun’10 CERC issued Order on Floor and Forbearance Price

Jun’10 CERC approved REC detailed procedures submitted by NLDC

Sep’10 CERC Issued Order on REC Fee and Charges

Sep’10 1st Amendment in REC Regulations

Nov’10 REC Mechanism Launched

Mar’11 1st REC Trading

July’13 2nd Amendment in REC Regulations

Dec’14 3rd Amendment in REC Regulations

May’15 Hon’ble Supreme Court Judgement regarding RPO Compliance

Mar’16 4th Amendment in REC Regulations

Mar’17 CERC Order on Floor and Forbearance Price

Nov’18 91st Trading session of REC

Chronology – REC Mechanism

7

REC Portal Home Page | https://www.recregistryindia.nic.in

• Transparent• User Friendly• Real Time Data• Single Touch Point

for information

Online payment gateway integrated w.e.f. August 2017 Expenditure incurred ~ approx. 14 crore (0.25% of total value of transactions) Knowledge dissemination - technical papers, conferences, stalls etc. 27 workshops organized - on an average 30 officials trained More than 40 petitions have been filed in by the RE generators

Experience of management of REC registry Key Highlights

GREEN ATTRIBUTE

ELECTRICITY

RENEWABLE

ENERGY

CERTIFICATE

SOLAR CERTIFICATE

NON-SOLAR CERTIFICATE

Concept of Renewable Energy Certificate

One REC represents one MWh of energy generated from renewable sources

8

Transaction of ‘electricity’ and ‘green certificates’ in different

markets

Existing

MechanismDistribution

Company/

obligated

entity

Tariff

Determined under

Section 62/ 63 of the

Electricity Act/

Bilateral

REC

Mechanism

Obligated

Entity

(Buyer)

REC price discovered

at PXs

Distribution

Company

OA / Trader

Bilateral Agreement /

Trading through PXs

Average pooled

power purchase cost

(APPC)

of Host Utility

RE Source

RE Source

Concept of Renewable Energy Certificate

10

Electricity as BrownComponent

RE Generation

Sale of GreenEnergy

Electricity as GreenComponent (REC)

Obligated Entities /Voluntary Buyers

Distribution Company/ Third Party Sale/

Power ExchangesObligated Entities

CERC REC Regulations -2010

Sell to DISCOM at Pooled cost of

Power Purchase

2. Grid Connected RE technology approved by MNRE under following routes

Self Consumption/ Captive useThird party sale/Open

AccessPPA with Distribution

Licensee

Plant Commissioned between29.09.2010 and 31.03.2016and not availing benefit in theform of concessional /promotional transmission orwheeling charges and/orbanking facility benefit &registered before 30.06.2016

RE generator is notavailing benefit in theform of concessional/promotional transmissionor wheeling chargesand/or banking facilitybenefit

PPA at rates as determined

under section 62 and 63 of Act

Eligible Eligible Not Eligible

Plant Commissioned prior to 29.09.2010 or after 31.03.2016

Not Eligible Eligible

Eligibility for Registration under REC Mechanism

1. Distribution Licensee – which has purchased Renewable Energy over and above their RPO

11

NLDC designated as Central Agency by Hon’ble CERC

The functions of Central Agency includes :o Registration of Eligible Entities

o Issuance of Certificate

o Maintaining and settling accounts in respect of the certificate

o Repository of transactions of certificates and

o Any other function incidental to the implementation of RECMechanism

The NLDC has developed various procedures tooperationalize REC mechanism

Appointment of NLDC as Central Agency

• CERC REC Regulations 2010 (and 4 amendments)

• SERC Regulations- 29 SERCs/JERCs have notified the RPO Regulations/Orders

Regulations by CERC and SERCs

13

Important Amendments in REC Regulations

• Renewable energy contracted through competitive bidding is not eligibleunder REC Mechanism

• After registration, the RE gen. eligible for RECs from the date of commercialoperation or from the date of registration whichever is later

• The eligible entity shall apply to the Central Agency for certificates within sixmonths from the corresponding generation

• Shelf-life of RECs extended from 365 days to 730 days to 1095 days

• Incentive to DISCOMs to procure beyond RPO target - DISCOMs eligible toreceive RECs

• Project under Self-consumption route is not eligible for new Registrationunder REC Scheme

• Vintage multiplier factor of 2.66 for Solar Generators which have registeredtheir project prior to 1st Jan 2015

• An RE Generator may retain the RECs for offsetting its RPO as a consumer

• Revocation of RECs/recovery of sale proceeds of RECs of those RE generatorswho have registered their projects on false information

15

Participation Voluntary

REC Denomination 1 REC = 1MWh

Validity 1095 days after issuance

Categories 1. Solar 2. Non-Solar (unique certificate number)

Sellers Eligible RE Generators / Distribution Licensees (DISCOM)

Buyers 1. Obligated Entities (DISCOM/ CPP / OA Consumers) 2. Voluntary

Trading Platform Power Exchanges

Trading Periodicity Last Wednesday of the month

Banking / Borrowing Not Allowed

Transfer Type Single transfer only, repeated trade of the same certificate is not possible

Salient Features of the REC Mechanism

01.06.2010 -

31.03.2012

01.04.2012-

31.03.2017

w.e.f.

01.04.2017

01.06.2010 -

31.03.2012

01.04.2012 -

31.12.2014

01.01.2015 -

31.03.2017w.e.f. 01.04.2017

Forbearance Price

(Rs./MWh)3,900 3,300 3,000 17,000 13,400 5,800 2,400

Floor Price

(Rs./MWh)1,500 1,500 1,000 12,000 9,300 3,500 1,000

Non - Solar REC Solar REC

Floor and Forbearance Price

STAGES UNDER REC MECHANISM

1. ACCREDITATION 2. REGISTRATION

4. REDEMPTION

RE GENERATOR APPLIES ONLINE STATE AGENCY VERIFIES DETAILS STATE AGENCY ACCREDITATE/ REJECTS

ACCREDITATION

REGISTRATION

ISSUANCE

TRADE & REDEMPTION

RE GENERATOR APPLIES ONLINE CENTRAL AGENCY VERIFIES DETAILS CENTRAL AGENCY REGISTER/ REJECT

RE GENERATOR APPLIES ONLINE (10th ,20th and last

day of month)

SLDC VALIDATES ENERGY INJECTION REPORT

CENTRAL AGENCY ISSUES REC

Redemption through Power Exchanges (PX) BUYERS & SELLERS PLACE BIDS AT PXs POWER EXCHANGES SEND PROVISIONAL FILE TO

CENTRAL AGENCY FOR VALIDATION OF SALE BIDS CENTRAL AGENCY SENDS EXCEPTION REPORT IF ANY PXs PROCESS FINAL TRADE

Redemption through Self-retention of RECs by RE generators

3. ISSUANCE

Processes in REC Mechanism

REC procedures• In line with the CERC REC Regulations, Central Agency has developed procedures for each process• 5 times the procedures have been modified since launch of the mechanism

16

Source WiseAccredited

Capacity (MW)

Accredited

Projects

Registered

Capacity (MW)

Registered

Projects

No. of RECs

Issued

No. of RECs

Redeemed

through

Power

Exchanges

No. of RECs

Redeemed

through Self

Retain

Closing

Balance

Percentage of

Registered

Projects

Percentage of

RECs Issued

Percentage of

RECs

Redeemed

through Power

Exchanges

1 Wind 2,250 436 2,206 415 20,280,775 17,514,594 1,531,571 1,234,610 45.7% 40.3% 38.2%

2 Biomass 513 50 425 42 9,137,080 8,882,628 147,549 106,903 4.6% 18.1% 19.4%

3Bio-fuel

cogeneration882 97 412 56 7,879,491 7,672,685 5,001 201,805 6.2% 15.6% 16.7%

4 Solar PV 743 372 737 366 8,367,947 7,774,342 88,677 504,928 40.3% 16.6% 16.9%

5 Small Hydro 227 36 179 30 3,979,083 3,908,160 6,899 64,024 3.3% 7.9% 8.5%

6

Urban or

Municipal

Waste0 0 0 0 72,892 72,892 0 0 0.0% 0.1% 0.2%

7 Others 2 1 0 0 16,843 9,970 5,010 1,863 0.0% 0.0% 0.0%

8 DISCOM NA NA NA NA 652,259 33,120 0 619,139 NA 1.3% 0.1%

Total 4,616 992 3,960 909 50,386,370 45,868,391 1,784,707 2,733,272

Source wise breakup- as on 30.11.2018

Registration Map

Report on REC in India : Key learnings, Data analysis and Way forward

https://recregistryindia.nic.in/pdf/Others/Report_on_REC_Mechanism.pdf

19

S. No.Off-take

Route

Total Registered till

31.03.2018

Registration

Revoked/ Expired

Registered as on

31.03.2018 No. of RECs

IssuedNo. of

Projects

Capacity

(MW)

No. of

Projects

Capacity

(MW)

No. of

Projects

Capacity

(MW)

1 OA 368 1,112 72 279 296 833 8,068,723

2 APPC 425 2,055 121 396 304 1,659 16,359,559

3 CGP 355 2,137 161 1,156 194 981 16,602,593

4 APPC/OA 4 57 1 24 3 33 444,418

5 CGP/OA 96 428 1 2 95 427 3,824,715

Total 1,248 5,789 356 1,855 892 3,934 45,300,008

Registered projects

S. No. RE SourceMaximum

Capacity (MW)

Minimum

Capacity (MW)

Average

Capacity (MW)

1 Bio-fuel cogeneration 25.26 0.95 7.07

2 Biomass 31.5 0.74 9.79

3 Small Hydro 24.00 1.00 7.08

4 Solar PV 19.00 0.10 2.04

5 Wind 50.40 0.23 5.25

Typical size of registered RE plants

Registered under OA/APPC/CGP(self-consumption) route

As on 31.03.2018- Report on REC Mechanism

20

S. No. State No. of Projects Capacity (MW)

1 Tamil Nadu 241 1,140

2 Maharashtra 298 939

3 Uttar Pradesh 64 748

4 Rajasthan 130 622

5 Gujarat 41 266

6 Madhya Pradesh 107 204

7 Andhra Pradesh 32 174

8 Karnataka 14 126

9 Himachal Pradesh 15 106

10 Punjab 8 63

11 Telangana 12 58

12 Odisha 5 37

13 Uttarakhand 5 28

14 Jammu and Kashmir 3 28

15 Chhattisgarh 2 25

16 Haryana 8 21

17 Bihar 3 18

18 Delhi 2 8

19 Tripura 1 5

20 Kerala 1 1

DISCOMs

1 Maharashtra 2 NA

2 Himachal Pradesh 1 NA

3 Andhra Pradesh 1 NA

Total 996 4,616

S. No. State No. of Projects Capacity (MW)

1 Tamil Nadu 241 1,136

2 Maharashtra 263 833

3 Rajasthan 130 622

4 Uttar Pradesh 31 326

5 Gujarat 42 260

6 Madhya Pradesh 107 204

7 Andhra Pradesh 30 163

8 Karnataka 14 127

9 Himachal Pradesh 14 97

10 Telangana 13 60

11 Odisha 4 29

12 Uttarakhand 5 28

13 Chhattisgarh 2 25

14 Haryana 6 15

15 Punjab 2 15

16 Delhi 2 8

17 Bihar 1 6

18 Tripura 1 5

19 Kerala 1 1

DISCOMs

1 Maharashtra 2 NA

2 Himachal Pradesh 1 NA

3 Andhra Pradesh 1 NA

Total 913 3,960

RE Projects accredited by State Agencies RE Projects registered by Central AgencyAs on 30.11.2018

21

Registered Solar PV Projects

As on 31.03.2018- Report on REC Mechanism

22

Registered Wind Projects

As on 31.03.2018- Report on REC Mechanism

23

Registered Bio-fuel Cogeneration Projects

As on 31.03.2018- Report on REC Mechanism

24

Registered Small Hydro Projects

As on 31.03.2018- Report on REC Mechanism

25

Registered Biomass Projects

As on 31.03.2018- Report on REC Mechanism

26

Technology-wise RECs issued as on November 30, 2018

Wind2,02,80,775

40%

Biomass91,37,080

18%

Bio-fuel cogeneration78,79,491

16%

Solar PV83,67,947

17%

Small Hydro39,79,083

8%

Urban or Municipal Waste72,8920.14%

Others16,8430.03%

DISCOM6,52,259

1%

Technology-wise Percentage of RECs Issued

0

2,00,000

4,00,000

6,00,000

8,00,000

10,00,000

12,00,000

14,00,000

16,00,000

18,00,000

20,00,000M

ar-1

1

May

-11

Ju

l-1

1

Sep

-11

No

v-1

1

Jan

-12

Mar-1

2

May

-12

Ju

l-1

2

Sep

-12

No

v-1

2

Jan

-13

Mar-1

3

May

-13

Ju

l-1

3

Sep

-13

No

v-1

3

Jan

-14

Mar-1

4

May

-14

Ju

l-1

4

Sep

-14

No

v-1

4

Jan

-15

Mar-1

5

May

-15

Ju

l-1

5

Sep

-15

No

v-1

5

Jan

-16

Mar-1

6

May

-16

Ju

l-1

6

Sep

-16

No

v-1

6

Jan

-17

Mar-1

7

May

-17

Ju

l-1

7

Sep

-17

No

v-1

7

Jan

-18

Mar-1

8

May

-18

Ju

l-1

8

Sep

-18

No

v-1

8

No

. o

f R

EC

s is

sued

Non-solar

Jul'13, 2nd Amendment to

the

REC Regulations (w.e.f.

10.07.2013)

Application window for issuance of

RECs increased from 3 months to 6

months

Issuance of RECs made 3 times

instead of 2 times in a month

27

Ma

r'1

1, 1

st t

rad

ing o

f no

n-s

ola

r R

EC

s o

n P

Xs

Dec'14, 3rd Amendment to the

REC Regulations (w.e.f. 01.01.2015)

Mar'16, 4th Amendment to the

REC regulations (w.e.f. 30.03.2016)

Month-wise issuance of non-solar RECs

28

0

50,000

1,00,000

1,50,000

2,00,000

2,50,000

3,00,000

3,50,000

4,00,000

May

-12

Ju

l-1

2

Sep

-12

No

v-1

2

Jan

-13

Mar-1

3

May

-13

Ju

l-1

3

Sep

-13

No

v-1

3

Jan

-14

Mar-1

4

May

-14

Ju

l-1

4

Sep

-14

No

v-1

4

Jan

-15

Mar-1

5

May

-15

Ju

l-1

5

Sep

-15

No

v-1

5

Jan

-16

Mar-1

6

May

-16

Ju

l-1

6

Sep

-16

No

v-1

6

Jan

-17

Mar-1

7

May

-17

Ju

l-1

7

Sep

-17

No

v-1

7

Jan

-18

Mar-1

8

May

-18

Ju

l-1

8

Sep

-18

No

v-1

8

No. of

Sola

r R

EC

s Is

sued

Issuance of…Vintage multiplier factor (2.66) for eligible

solar generator for the period from

01.01.2015 to 31.03.2017

Ma

y'1

2, 1

st t

rad

ing o

f so

lar

RE

Cs

on P

Xs

Jul'13,2nd Amendment to the

REC Regulations (w.e.f.

10.07.2013)

DISCOMs are eligible for

issuance of REC

Dec'14,3rd Amendment to

the

REC Regulations

(w.e.f. 01.01.2015)

Month-wise issuance of solar RECs

29

REC Market

REC Market Design

Power Market Regulations, 2010– Rules and byelaws

– Type of contract (day ahead, term ahead etc.);

– Price Discovery methodology and matching rules

Regulatory changes in REC Market design,2012– Modification in price discovery methodology and matching rules

– ‘Price time priority’ to ‘Price-pro-rata’ rule

Salient features of the REC Market Design

Auction type: Closed, double sided auction where both the sellers and buyers

participate anonymously

Bidding: Anonymous

Participation: Voluntary

Price formation: Uniform price auction

Price caps: Floor and ceiling prices notified by the CERC from time to time

Standard contract: 1 REC equivalent to 1 MWh

Categories of certificates: Solar and Non-Solar

31

53

2

424

1,6

1,8

4,1

51

0

20,00,000

40,00,000

60,00,000

80,00,000

1,00,00,000

1,20,00,000

1,40,00,000

1,60,00,000

1,80,00,000

2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

No.

of

RE

Cs

REC Issued REC Redeemed REC Self-retained

FY-wise breakup of RECs issued, redeemed and self-retained

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

0

10,00,000

20,00,000

30,00,000

40,00,000

50,00,000

60,00,000M

ar,1

1A

pr,

11

May

,11

Jun

,11

Jul,1

1A

ug,

11

Sep

,11

Oct

,11

No

v,1

1D

ec,1

1Ja

n,1

2Fe

b,1

2M

ar,1

2A

pr,

12

May

,12

Jun

,12

Jul,1

2A

ug,

12

Sep

,12

Oct

,12

No

v,1

2D

ec,1

2Ja

n,1

3Fe

b,1

3M

ar,1

3A

pr,

13

May

,13

Jun

,13

Jul,1

3A

ug,

13

Sep

,13

Oct

,13

No

v,1

3D

ec,1

3Ja

n,1

4Fe

b,1

4M

ar'1

4A

pr'

14

May

'14

Jun

'14

Jul'1

4A

ug'

14

Sep

'14

Oct

'14

No

v,1

4D

ec,1

4Ja

n,1

5Fe

b,1

5M

ar,1

5A

pr,

15

May

,15

Jun

e'1

5Ju

ly'1

5A

ug'

15

Sep

'15

Oct

'15

No

v'1

5D

ec'1

5Ja

n'1

6Fe

b'1

6M

ar'1

6A

pr'

16

May

'16

Jun

'16

Jul'1

6A

ug'

16

Sep

'16

Oct

'16

No

v'1

6D

ec'1

6Ja

n'1

7Fe

b'1

7M

ar'1

7A

pr'

17

May

'17

Jun

'17

Jul'1

7A

ug'

17

Sep

'17

Oct

'17

No

v'1

7D

ec'1

7Ja

n'1

8Fe

b'1

8M

ar'1

8A

pr'

18

May

'18

Jun

'18

Jul'1

8A

ug'

18

Sep

'18

Oct

'18

No

v'1

8

Cle

arin

g P

rice

(R

s./R

EC)

No

. of

REC

s

Market clearing Volume (No. Of RECs) Market Clearing Price IEX (Rs. /REC) Market Clearing Price PXIL (Rs. /REC)

Upto 30.11.2018

01.06.2010 – 31.03.2012 01.04.2012 – 31.03.2017 w.e.f. 01.04.2017

Forbearance Price (Rs. / MWh) 3,900 3,300 3,000

Floor Price (Rs. / MWh) 1,500 1,500 1,000

Traded Non-solar RECs and Average Clearing Price (Rs./REC)

1340013000

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

0

2,00,000

4,00,000

6,00,000

8,00,000

10,00,000

12,00,000

14,00,000

16,00,000

18,00,000

May

,12

Jun

,12

Jul,1

2A

ug,

12

Sep

,12

Oct

,12

No

v,1

2D

ec,

12

Jan

,13

Feb

,13

Mar

,13

Ap

r,1

3M

ay,1

3Ju

n,1

3Ju

l,13

Au

g,1

3Se

p,1

3O

ct,1

3N

ov,

13

De

c,1

3Ja

n,1

4Fe

b,1

4M

ar'1

4A

pr'

14

May

'14

Jun

'14

Jul'1

4A

ug'

14

Sep

'14

Oct

'14

No

v'1

4D

ec'

14

Jan

'15

Feb

'15

Mar

'15

Ap

r'1

5M

ay'1

5Ju

n'1

5Ju

l'15

Au

g'1

5Se

p'1

5O

ct'1

5N

ov'

15

De

c'1

5Ja

n'1

6Fe

b'1

6M

ar'1

6A

pr'

16

May

'16

Jun

'16

Jul'1

6A

ug'

16

Sep

'16

Oct

'16

No

v'1

6D

ec'

16

Jan

'17

Feb

'17

Mar

'17

Ap

r'1

7M

ay'1

7Ju

n'1

7Ju

l'17

Au

g'1

7Se

p'1

7O

ct'1

7N

ov'

17

De

c'1

7Ja

n'1

8Fe

b'1

8M

ar'1

8A

pr'

18

May

'18

Jun

'18

Jul'1

8A

ug'

18

Sep

'18

Oct

'18

No

v'1

8

No

. of

REC

s

Market clearing Volume (No. Of RECs) Market Clearing Price IEX (Rs. /REC) Market Clearing Price PXIL (Rs. /REC)

Cle

ari

ng

Pri

ce (

Rs.

/R

EC

s)

Till 30.11.201801.06.2010 – 31.03.2012

01.04.2012 –

31.12.2014

01.01.2015 – 31.03.2017

#

w.e.f.

01.04.2017

Forbearance Price (Rs. /

MWh)17,000 13,400 5,800 2,400

Floor Price (Rs. / MWh) 12,000 9,300 3,500 1,000

# Vintage multiplier (2.66) introduced, and was valid up to March 31, 2017

Traded Solar RECs and Average Clearing Price (Rs./REC)

34

Total value of Transactions

~ Rs. 6982 Crore

Month wise value of transaction of RECs

APTEL Order dated 20th April 2015

• Carry forward/review should be allowed - keeping in view of availability of REC.

• In case of default in fulfilling RPO, the penal provision should be exercised.

Hon’ble Supreme court (SC) judgment dated 13.05.2015• Hindustan Zinc vs RERC on the applicability of RPO regulations.

• RPO on captive consumer and open access consumer is justified

• Obligated entities have option to purchase of RECs from Power Exchange(s).

• Interpreted the RPO in the context of Article 51A (g) and Article 21 of the Constitution of India

Hon’ble Supreme Court Order regarding REC Trading• Hon’ble CERC vide order dated 30.03.2017 reduced the Floor and Forbearance Price

• Hon’ble Supreme Court(SC) vide interim order dated 08.05.2017, stayed the trading of RECs

• Hon’ble SC vide order dated on 14.07.2017, allowed the trading of non-solar RECs

• Hon’ble APTEL vide order dated April 12,2018 decided that the trading of RECs (solar and non-solar) shall be carried out as per Hon’ble CERC order dated March 30,2017

• Hon’ble SC in its interim order dated May 14, 2018, directed that “…Interim orders dated08.05.2017 and 14.07.2017 to continue. However, we clarify that this interim order will not applyto RECs issued on or after 01.04.2017…”.

Subsequently, non-solar RECs issued up to March 30, 2017- being traded as per the old rates

RECs (solar & non-solar) which were issued after April 01, 2018 - being traded as per rates notified videCERC order dated March 30, 2017.

35

Judicial Orders regarding RPO Compliance

36

Type of

Buyer2011-12* 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Total

% of total

REC

Purchased

DISCOM 769,986 2,037,013 2,075,604 2,396,711 2,051,278 3,412,651 9,756,733 22,499,976 60.7

OA/CPP 245,698 532,151 671,346 663,232 2,901,010 3,073,112 6,426,872 14,513,421 39.2

Voluntary 14 20,650 1,744 1,979 2,865 1,976 546 29,774 0.1

Total 1,015,698 2,589,814 2,748,694 3,061,922 4,955,153 6,487,739 16,184,151 37,043,171 100

* Include 424 RECs Purchased by OA consumer / CPP and Voluntary in March 2011

FY-wise purchase of RECs by the obligated entities

76% 79% 76% 78% 41% 53% 61%

24%21%

24%22%

59%

47%

39%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2011-12* 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

DISCOM OA/CPP

* Include 424 RECs Purchased by OA/ CPP consumer and Voluntary buyers in March 2011.

37

0

50,00,000

1,00,00,000

1,50,00,000

2,00,00,000

2,50,00,000

3,00,00,000

3,50,00,000

4,00,00,000

4,50,00,000

5,00,00,000

2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

No

. of

REC

s

Financial Year

RECs available for trade/ not Redeemed

RECs purchased by OA/CPP

RECs purchased by DISCOMs

Issuance and Redemption of RECs

38

S. No. DISCOMs State 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Total

1 Assam Power Distribution Company Limited Assam 0 0 0 0 62,500 0 131,324 106,496 300,320

2Bihar State Power Holding Company

Limited- PatnaBihar 0 0 0 0 0 0 0 1,000,841 1,000,841

3North Bihar Power Distribution Company

LimitedBihar 0 0 0 0 0 0 0 346,796 346,796

4South Bihar Power Distribution Company

LimitedBihar 0 0 0 0 0 0 0 358,218 358,218

5Electricity Wing of Engineering Dept UT

ChandigarhChandigarh 0 10,752 55,087 58,092 43,750 53,400 28,300 22,000 271,381

6Jindal Steel and Power Ltd Distribution

LicenseChhattisgarh 0 0 0 66,869 49,556 0 0 91,615 208,040

7Dadra and Nagar Haveli Power distribution

company

Dadra and Nagar

Haveli0 58,000 90,000 40,000 115,000 90,000 210,000 0 603,000

8 Electrical Dept UT Daman and Diu Daman and Diu 0 750 4,700 13,200 79,733 165,379 13,334 85,008 362,104

9 BSES Rajdhani Power Limited Delhi 0 0 0 0 0 0 333,332 0 333,332

10 BSES Yamuna Power Limited Delhi 0 0 0 0 0 0 20,000 46,660 66,660

11Tata Power Delhi Distribution Limited/

NDPLDelhi 0 0 0 0 0 0 166,666 1,953,276 2,119,942

12 Electricity Department Government of Goa Goa 0 0 0 0 85,000 120,000 0 57,000 262,000

13 Gujarat Urja Vikas Nigam Limited Gujarat 0 0 0 0 150,000 0 0 0 150,000

14Torrent Power Limited - Ahmedabad

DistributionGujarat 0 288,587 193,770 245,765 417,800 409,720 289,404 30,322 1,875,368

15 Torrent Power Limited - Dahej Distribution Gujarat 0 3,000 1,000 4,155 12,065 22,720 18,600 0 61,540

16 Torrent Power Limited - Surat Distribution Gujarat 0 131,835 76,551 119,795 197,200 168,590 9,000 176,831 879,802

Continued…

RECs purchased by DISCOMs

39

S. No. DISCOMs State 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Total

17Himachal Pradesh State Electricity

Board Ltd

Himachal

Pradesh0 0 0 0 0 0 3,863 0 3,863

18Damodar Valley Corporation

JharkhandJharkhand 0 0 1,704 1,866 1,866 1,832 125,990 151,067 284,325

19Tata Steel Limited Power Distribution

LicenseeJharkhand 0 0 73,571 12,000 78,000 165,500 50,000 137,527 516,598

20 Kerala State Electricity Board Limited Kerala 0 0 0 0 0 0 100,000 0 100,000

21Brihan Mumbai Electric Supply &

Transport UndertakingMaharashtra 148 1,000 439,884 220,000 176,000 125,000 217,060 376,811 1,555,903

22Maharashtra State Electricity

Distribution Company LimitedMaharashtra 0 0 0 0 100,000 0 666,000 4,101,944 4,867,944

23 Reliance Infrastructure Limited Maharashtra 0 87,529 504,750 424,200 544,910 574,435 440,332 0 2,576,156

24 The Tata Power Company Limited Maharashtra 0 188,385 261,306 272,566 48,000 83,100 0 74,968 928,325

25Manipur State Power Distribution

Company LimitedManipur 0 0 0 0 0 3,997 0 0 3,997

26Meghalaya Power Distribution

Corporation LimitedMeghalaya 0 0 0 0 0 0 2,000 375 2,375

27Power and Electricity Department

Government of MizoramMizoram 0 0 0 0 1,055 1,105 1,000 0 3,160

28Electricity Department Government of

PuducherryPuducherry 0 0 48,000 112,000 108,690 65,000 0 97,259 430,949

29Punjab State Power Corporation

LimitedPunjab 0 0 285,350 483,333 0 0 66,666 61,751 897,100

30Tripura State Electricity Corporation

LimitedTripura 0 0 0 297 0 0 0 0 297

31Uttarakhand Power Corporation

LimitedUttarakhand 0 0 0 0 124,120 0 152,500 50,000 326,620

32Damodar Valley Corporation West

BengalWest Bengal 0 0 1,340 1,466 1,466 1,500 367,280 429,968 803,020

Total 148 769,838 2,037,013 2,075,604 2,396,711 2,051,278 3,412,651 9,756,733 22,499,976

RECs purchased by DISCOMs

40

RECs purchased by OA/CPP consumers

RECs purchased by DISCOMs

RECs vis a vis market development

41

RECs vis a vis market development

No. of DISCOMs participated in trading of RECs at PXs

No. of OA consumers/CPPs participated in trading of RECs at PXs

42

• More than 27,000 RECs were purchased by central public-sector enterprises due toinclusion of purchase of RECs under Corporate social Responsibility (CSR) by departmentof public enterprises (DPE) in 2012-13

• 7,564 RECs were purchased by POSOCO under its CSR• 8,732 RECs were purchased by individuals• 20,911 RECs by the other companies/institutions• 575 RECs were purchased by the World Bank country office

S. No. FYNo. of RECs Purchased

Solar Non-solar Total

1 2010-11 0 2 2

2 2011-12 0 12 12

3 2012-13 0 20,650 20,650

4 2013-14 0 1,744 1,744

5 2014-15 603 1,376 1,979

6 2015-16 698 2,167 2,865

7 2016-17 570 1,406 1,976

8 2017-18 1 545 546

TOTAL 1,872 27,902 29,774

Voluntary Buyers of REC(s)

43

Investment facilitated by the REC Mechanism• Provided an additional avenue to RE generator(s) to sell their power locally to

DISCOM and/or open access consumer• Capital investment by RE generators• Positive signal to investors- Traded value of RECs ̴ Rs.7,000 crores

Facilitates RPO Compliance• 4.6 crore RECs purchased by more than 3,000 obligated entities(DISCOMs/CPPs/OA

consumers) purchased• Without REC Mechanism, RPO compliance for small obligated entities like CPPs /

Open Access consumers would have been very difficult• Choices to Obligated entities

Inter-State RE Transactions• Inter-state transaction of Renewable energy- CERC DSM Regulations• RECs issued to projects located in 21 States/ UTs vs. RECs purchased by obligated

entities of 30 States/ UTs• Self-retention of RECs - RE generators may offset RPO as a consumer for their

consumption units located in different parts of the country

Development of Market for voluntary Buyers• About 30,000 RECs have been purchased by voluntary buyers including companies,

institutions and individuals.

Impact of REC Mechanism

44

RPO Compliance

Demand-Supply mismatch

Limited Voluntary Market

Market Design

Reduction in the floor and forbearance

Enforcement of RPO by SERCs

Capacity Building of the stakeholders

Challenges and way forward

Weblinks

• www.powermin.nic.in

• www.mnre.gov.in

• www.cercind.gov.in

• www.forumofregulators.gov.in

• www.recregistryindia.nic.in

• www.iexindia.com

• www.powerexindia.com

• http://www.aperc.gov.in

• http://www.apserc.nic.in/

• http://aerc.nic.in/

• https://berc.co.in/

• http://www.cserc.gov.in/

• http://www.derc.gov.in/

• http://www.gercin.org/

• https://herc.gov.in/

• http://hperc.org/

• http://www.jkserc.nic.in/

• http://jserc.org/

• https://www.karnataka.gov.in/

• http://www.erckerala.org/

• http://www.mperc.nic.in/

• http://www.mercindia.org.in/

• http://www.mserc.gov.in/

• http://www.nerc.org.in/

• http://www.orierc.org/

• http://pserc.nic.in/

• http://rerc.rajasthan.gov.in/

• http://www.sserc.in/

• http://www.tnerc.gov.in/

• http://www.tserc.gov.in/

• http://terc.nic.in/

• http://www.uperc.org/

• http://www.uerc.gov.in/

• http://www.wberc.net/

• https://www.jerc.mizoram.gov.in/

• http://www.jercuts.gov.in/

THANK YOU