Overview of REC Mechanism in India

Presented By-

Vedant Sonkhiya

B.Tech(Energy Technology)L.LB.(IPR)

Overview of REC Mechanism

RE Scenario

Source- CEA

Potential of RE

Source- MNRE

Overview of RPO & SPO

NAPCC that aims at 15% renewable energy mix in overall Energy mix in India, by 2020

RPOs was initiated by CERC to mandate the State utilities procure the power from RE sources ,section 86(1) e under EA act 2003

RPO target are fixed by respective state electricity regulatory commission

RPO are enforced on three categories of power consumers- Distribution licensee, Open access consumer and captive consumers

SPO is solar purchase obligation

Every states is having different potential of renewable energy

Introduction to REC

Renewable Energy Certificates (RECs) represent the attributes of electricity generated

from renewable energy sources

Two products-the attributes embodied in the certificates and the commodity electricity

are sold or traded separately

ONE REC represents that 1MWh of energy is generated from renewable sources

Expected to become the currency of renewable energy markets because of their

flexibility

RECs are not subjected to the geographic and physical limitations of commodity

electricity

Traded in Indian Energy exchange and Power exchange of India ltd

Obligated Entities

Entities mandated to purchase a defined quantum of renewable energy of

their overall consumption are Obligated entities

Obligated entities may either purchase renewable energy or can purchase

RECs to meet their Renewable purchase Obligation (RPO) set under

Renewable Purchase Obligation of their respective States.

Following entities are obligated in the State:-

a. Distribution Licensees

b. Captive Consumers

c. Open Access users

REC

Eligible participants

Eligibility

Operational Framework

Trading of REC

The price of REC would be determined in power exchange.

REC would be traded in power exchange within the forbearance price and floor price determined by CERC from time to time

Floor Price : price has been determine in the basic min requirement for insuring the viability of RE project set up to meet the RE target

Forbearance price : Price has been derived based on the highest different between cost of generation of RE technology and average power purchase cost

Features of REC

REC Mechanism

Procedure

Procedure

State Nodal Agency (SNA) authorizes or endorses the RE Generator and recommends it for registration

NLDC (Central Agency) registers their Generator as ‘Eligible Entity’ for its RE Generation Project

The electricity generated from RE project is injected into the grid and sold to either a distribution licensee or open access consumer with whom it has contract or sold through the power exchange

Once the RECs are issued to the RE Generator (Eligible Entity), sale/purchase of RECs amongst Eligible RE Generators and Obligated entities to be undertaken only through Power Exchanges.

The Obligated Entities purchase RECs through PXs and to surrender to SERC or other agency as specified by SERCs as to meet their RPO.

NLDC (REC Registry) maintains record of RECs sold and purchased

Compliance Auditors to monitor and report the compliance of REC Regulations

REC- FEE & Charges

Update on REC

References

Indian Energy Exchange

MNRE

CEA

http://www.iexindia.com/pdf/media_kit/IEX_REC.pdf

http://www.slideshare.net/ashishverma061/rec-a-overview