Power exchanges have not yet resumed trading renewable energy certificates (REC) as they await the final order from the Appellate Tribunal for Electricity (APTEL), allowing resumption.

REC trading has now been halted for over four months. The APTEL had issued an order postponing RECs’ trade scheduled for July 29 by four weeks in a hearing of an appeal by the Green Energy Association against the Central Electricity Regulatory Commission (CERC).

“The market has not been trading since July 2020, and we are now moving towards the end of the compliance year 2020-2021. Any further delay in the resumption of trade will be detrimental to the ability of obligated entities to fulfill their renewable purchase obligation (RPO) compliance on time. We are hopeful that the APTEL will soon issue the final order so that the trade can be resumed in December 2020,” said Rohit Bajaj, Head and Senior Vice President – Business Development, Indian Energy Exchange Limited (IEX).

Previously, power exchanges were expecting REC to resume trade by November 25 – the last Wednesday of the month, which is when the green certificates are traded on the IEX and Power Exchange India Limited (PXIL).

Rohit Bajaj, Head and Senior Vice President-Business Development, Indian Energy Exchange Limited, told Mercom that the APTEL’s order to stay REC trading has significantly impacted the renewable energy market in an interview. He explained that it had created an impediment for obligated entities such as distribution utilities, industrial consumers, and captive power producers who cannot buy RECs to meet their RPO requirements.

Green Energy Association, along with the Indian Wind Power Association (IWPA), and Techno Electric and Engineering Company Limited had filed an appeal with the APTEL against the CERC’s order removing the floor price and reducing the forbearance price.

Renewable energy certificates are market-based instruments used to incentivize power generators to reduce or eliminate harmful emissions while generating power. Owning one REC is an attestation that the bearer has contributed 1 MW of renewable energy to the power grid. These certificates can be traded on the open market as an energy commodity.