Renewable Energy Certificate


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Discusses about Renewable Energy certificates mechanism in India.

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  • Obligated entities are Distribution licensee, Captive consumers, Open access consumers
  • Renewable Energy Certificate

    1. 1. 1Renewable Energy CertificatesPresented By:Jaspal Singh (Dy. Mgr. – NETRA)
    2. 2. 2Renewable Energy CertificatesInstalled generation capacity66%21%3% 11%ThermalHydroNuclearRenewableSource: Ministry of PowerTotal installed capacity as on 31-12-2011 : 1,86,654 MW
    3. 3. 3Renewable Energy CertificatesRE Generation capacityTotal renewableGeneration capacity(31-03-2011): 19,974 MW70.0%15.0%5.0%8.0%0.5% 0.2%Wind powerSmall HydroBimass PowerBagasse cogenerationWaste to energySolar Power
    4. 4. 4Renewable Energy Certificates The Electricity Act, 2003, the policies framed under the Act, as also theNational Action Plan on Climate Change (NAPCC) provide for a roadmap forincreasing the share of renewable in the total generation capacity in the country. NAPCC envisages Renewable purchase obligation target of 5% at nationallevel for 2010 with 1 % annual increase so as to reach around 15 % RPO (Renewable Purchase Obligation) by 2020. RPO : Distribution companies need to purchase certain percentage of theirtotal power requirement from renewable energy sources. RPO targets are set by SERCPolicies to Enhance Renewable Energy
    5. 5. 5Renewable Energy CertificatesStates 2011-12 2012-13 2013-14 2014-15TAMIL NADU 14%KARNATKA 10% 10%MAHARASTRA 7% 8 %KERALA 3.3% 3.6 % 3.9 % 4.2 %GUJARAT 6% 7 %RAJSTHAN 9.5%AP 5%UP 5 %HP 11.10 % 6 %CHHATISGARH 5.25 % 12.10 %PUNJAB 2.31 % 2.49 % 2.68 % 2.85 %RPO Trajectory
    6. 6. 6Renewable Energy CertificatesState FY11-12 @MW FY12-13 @MWGujarat 0.5 % 186 1.00 % 372Uttar Pradesh 0.5 % 173 1.0 % 345Rajasthan 0.5 % 112 0.75 % 168Tamil Nadu 0.15 % 65 0.25 % 110Orissa 0.10 % 13 0.15 % 20Haryana 0.0047 % 0.77 0.0063 % 1HP 0.10 % 4 0.10 % 4Solar RPO
    7. 7. 7Renewable Energy CertificatesRE selling options• RE generators can following options to sell the electricityRE GeneratorsSale atpreferentialtariffObligated entitiesElectricityComponentDistributioncompany /Third party saleRECComponentObligated entitiesSelfConsumption
    8. 8. 8Renewable Energy CertificatesWhat are RECRenewable Energy Certificates (RECs)represent the attributes of electricitygenerated from renewable energy sources.These attributes are unbundled from thephysical electricity and the two products—theattributes embodied in the certificates and thecommodity electricity—may be sold or tradedseparately
    9. 9. 9Renewable Energy CertificatesEligibility conditions for RECREC EligibilitySelf consumptionCaptive useNo concessionaltransmissionNo Banking FacilityBenefitNo Electricity DutyWaiverSale to Distributionlicensee, openaccess, power XchgSale at Marketdetermined pricePPA withDistributionLicenseePPA at preferentialtariffPPA with discom at<= APPCEligible if all Three conditions met Eligible EligibleNot EligibleSource: Water & Energy International
    10. 10. 10Renewable Energy CertificatesSalient features of REC• Categories of Certificates Solar certificates and Non-solar certificates• Issuing agency The Central Agency (designated by the Central Commission for registration of REgenerators participating in the scheme) will issue the REC to RE generators• Denomination 1 REC = 1 MWh• Validity of Certificates Apply for REC within 3 months of generation Validity : 1 year from the date of issuance of such certificate• Minimum capacity of Plant to claim REC 250 Kwp• REC trading only through power exchange(s) For price discovery and ensuring transparency
    11. 11. 11Renewable Energy CertificatesREC mechanism Benefits• Overcome geographical constraints REC’s are devised to address the above issue of un-even spread ofrenewable energy sources• Reduce risk for local Discom by limiting liability to only electricitypurchase• Reduce Transaction cost• Provide flexibility for effective implementation of RPO purchase States having less renewable energy potential can buy REC’s to fulfillthere Renewable purchase obligation (RPO)• Widening participation beyond Local discoms Captive consumers, Open access consumers & Voluntary market
    12. 12. 12Renewable Energy CertificatesRegistration of Eligible entities(Central level agency)Accreditation of RE powerplants(State nodal agency: SNA)Information related to accreditated RE plants for registeredentities sent to REC registrySale of electricity at parwith conventional powerDiscom issuingRE injectioncertificateState LoadDespatch Centre(SLDC)REGeneratorCentral RECRegistry (NLDC)REC exchangeAuditing PanelSERC: Compliancebased on SNAReport123564Informationrelated to REgenerationelectricityEnergyaccountingIssuance of RECInformationon RECpurchase/redemptionState NodalAgency SNA
    13. 13. 13Renewable Energy CertificatesVarious stakeholders for implementing REC• CERC – to regulate the entire set-up• SERC - to implement and monitor the compliance levels• MNRE – Definition of RE• MoP – representing Central Government• Central Agency (NLDC)– Registration, issuance of certificates, maintaining accounts, settlement,repository, Monitoring• Power Xchange(s) – For Trading• State level agencies : verifiers : (SLDC/State Nodal Agencies)• State Transmission Utilities (STU) : Reporting
    14. 14. 14Renewable Energy CertificatesREC’s Price Band• REC’s price shall be determined by the market however it shall trade inbetween the band set by Floor price and forbearance price.• Floor price and forbearance price shall be determined by CERCNon –SolarREC (Rs/ MWhUpto Mar2012)Non –Solar REC(Rs/ MWh)From Apr2012 – Mar2017Solar REC(Rs/ MWh)Upto Mar2012Solar REC(Rs/ MWh)From Apr2012 – Mar2017Forbearanceprice3900 3300 17000 13400Floor Price 1500 1500 12000 9300
    15. 15. 15Renewable Energy Certificates18 % reductionevery yearComparison of 1 MW Solar plant using PPA and REC marketCase study25 % reductionevery yearPlant Capacity 1 MWUnits generated / year 1664000YearsINR0. 5 10 15 20 25 30REC@18 % PPA REC @ 25%
    16. 16. 16Renewable Energy CertificatesChallenges for REC• Reducing floor Price• RPO levels are different for different states• APPC is dynamic• Solar Project financing is not possible if project feasibility isbased on REC• Periodicity of compliance for RPO - Annually
    17. 17. 17Renewable Energy CertificatesWay Forward• Vintage based Floor price for Solar REC– Multiplier linked to reduction in floor price• Same RPO level across the country• Trading of REC– Secondary Market– Multiple trading• Periodicity of RPO compliance – Quarterly for stabilization inprice
    18. 18. 18Renewable Energy Certificates