Non-Solar RECs Issued on or After April 1, 2017 to be Sold at Floor Price of ₹1,000

Non-solar renewable energy certificates (RECs) issued on or after April 1, 2017, will be sold at a floor price of ₹1,000 (~$14.809)/REC, the Supreme Court has ruled.

The court had admitted a civil appeal filed by the Indian Wind Power Association (IWPA) challenging the judgment passed by the Appellate Tribunal for Electricity (APTEL). While admitting the appeal, the apex court clarified, “Trading in non-solar REC issued prior to April 1, 2017, will be carried out at the floor price of ₹1,500 (~$22.215)/MWh. The obligated entities or power exchanges will have to deposit ₹500 (~$7.405)/MWh, the difference between the previous and the current floor price”.

“Non-solar RECs issued on or after April 1, 2017, will continue to be traded at the floor price of ₹1,000 (~$14.809)/MWh,” the court ruled.

Floor and forbearance prices of solar RECs for the purpose of trading at the power exchanges will continue to be governed in accordance with the Central Electricity Regulatory Commission (CERC)’s order dated March 30, 2017.

In March 2017, the CERC issued new forbearance and floor prices for REC (solar, non-solar). Under the CERC order of 2017, the new forbearance price of solar RECs was set at ₹2,500 (~$37.41)/MWh and the floor price was ₹1,000 (~$14.962)/MWh. The forbearance price for non-solar RECs was decided to be ₹2,900 (~$43.39)/MWh while the floor price was set at ₹1,000 (~$14.962)/MWh.

In April 2018, CERC gave its go-ahead for the trade of solar and non-solar renewable energy certificates (RECs) in the country. The new order came after the APTEL dismissed the petition filed by stakeholders against the issue of new forbearance and floor prices for solar and non-solar RECs.

In its new order, the CERC had stated that the deposit of the differential amount of ₹500 (~$7.516) per REC with the commission would be discontinued.

Recently, in an interview with Mercom, Vishal Pandya of Reconnect had said, “For non-solar RECs, the erosion of cost will be ₹6.5 billion if the multiplier is not brought into play.”

The current order will provide some relief to non-solar generators registered with the REC mechanism. If the floor price of ₹1,500 (~$22.215)/MWh is maintained for the old inventory, the generators will get a better return.

In April 2018, a total of 1,87,543 non-solar RECs were traded at a price of ₹1,000 (~$14.943) per REC.

Image credit: By Legaleagle86 [CC BY-SA 3.0], via Wikimedia Commons