After Two Months of Lows, Solar REC Trading Gathers Speed in May 2020

There was a considerable increase in the trading of both solar and non-solar renewable energy certificates (RECs) in May 2020 compared to the last month. This increase comes as a respite even as the ongoing COVID-19 crisis and the subsequent lockdown across the country have thwarted business activities.

A total of 41,469 solar RECs were traded on both the exchanges, out of which 35,793 solar RECs were traded on the Indian Energy Exchange (IEX), and 5,676 solar RECs were traded on the Power Exchange India Limited (PXIL).

Comparatively, the month of May fared much better than in April and recorded a 99% increase in trade volume. In April, a total of 20,842 solar RECs were traded, out of which 15,991 solar RECs were traded on the IEX, and 4,851 solar RECs were traded on the PXIL.

In May, the trade volume of solar RECs registered a 124% growth on IEX when compared to April, and on PXIL, the trade volume registered a growth of 17% when compared to the preceding month.


On IEX, the price discovered for solar RECs saw a decline of 17% and came down to ₹2,000 (~$27) from ₹2,400 (~$32) April, and the price discovered for solar RECs on PXIL saw a decline of 10% and stood at ₹1,800 (~$24) as compared to ₹2,000 (~$27) in the previous month.

Solar REC Market Trading

The sale bid for solar RECs on IEX was 93,298, whereas the buy bid was 41,415. Similarly, the buy bid for solar RECs on PXIL was 5,676, and the sale bid was 22,622.

The trade volume of non-solar RECs registered an increase of 35% when compared to April 2020. A total of 292,301 non-solar RECs were traded in May as compared to 217,093 non-solar RECs in April.

Out of the total trade volume of 292,301 non-solar RECs, 172,488 were traded on IEX, and 49,587 on PXIL, which marked an increase of 41% and 11% respectively.

The price discovered for non-solar RECs remained the same at ₹1,000 (~$13.26) on both IEX as well as PXIL when compared to April.

Non-Solar REC Market Trading

The sale bid for non-solar RECs on IEX stood at 3,017,326, whereas the buy bid was 242,714. Similarly, the sale bids for non-solar RECs on PXIL stood at 1,588,256, and the buy bid was 49,587.

Speaking to Mercom, Shruti Bhatia, Head-Corporate Communications and CSR at IEX, said, “The REC trading session on May 27, 2020, at IEX saw a 48% MoM increase in the cleared volume. The market saw good sell-side participation with total bids of 3.1 million while the buy bids were only 284,000. The good response from the generators was perhaps in anticipation of the Central Electricity Regulatory Commission’s (CERC) draft order wherein the regulator has proposed to remove the floor price and lower the forbearance price for both solar and non-solar segments to ₹1,000 (~$13.3) per REC in alignment with the renewable energy price discoveries in vogue. The major buyers during the session were captive power producers followed by distribution companies and open access.”

The CERC recently issued a proposal for establishing forbearance and floor prices for RECs. The proposed forbearance price is ₹1,000 (~$13.3) each for solar and non-solar RECs for 2020, against the 2017 prices of ₹2,400 (~$31.68)/MWh and ₹3,000 (~$39.60) respectively.

In April, CERC also passed an order extending the validity of RECs to avoid demand-supply imbalances in the REC market. It extended the validity of RECs that expired on April 1, 2020, to October 31, 2020. Additionally, it extended the validity of RECs set to expire between April 1, 2020, and September 30, 2020, so that they remain valid until October 31, 2020.