Rsm GC Advisory Renewable Purchase Obligation (RPO) & Renewable Energy Certificates (REC) - ver5

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Renewable Energy Generators in India

RPO mandated entities in India

Investors seeking to invest in renewable energy generation in India

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Rsm GC Advisory Renewable Purchase Obligation (RPO) & Renewable Energy Certificates (REC) - ver5

  1. 1. Renewable Purchase Obligation (RPO) / Renewable Energy Certificates (REC) Advisory and Trading
  2. 2. Target Clients  Renewable Energy Generators in India  RPO mandated entities in India  Investors seeking to invest in renewable energy generation in India www.general-carbon.com 2
  3. 3. About RPO  The Electricity Act & National Action Plan on Climate Change (NAPCC) provide roadmap for increasing renewable energy in total generation The Electricity Act, 2003  Renewable Purchase Obligation (RPO) – is mandated by SERC for promotion of renewable energy  RPO stipulates minimum percentage of renewable energy in energy mix of ♦ Distribution licensee ♦ Open Access Consumer ♦ Captive consumer www.general-carbon.com National Action Plan on Climate Change (NAPCC) – June 2008 5% 10% 2010 2015 15% 2020 3
  4. 4. Notified RPO by States State Non Solar RPO % (FY 13-14) Solar RPO% (FY 13-14) Maharashtra 8.50 0.50 Madhya Pradesh 4.70 0.80 Tamil Nadu* 9.00 0.10 Rajasthan 8.20 1.00 Haryana 3.00 0.10 Gujarat* 6.00 1.00 Chhattisgarh* 5.25 0.50 Karnataka 10.00 0.25 Andhra Pradesh 4.75 0.25 Orissa 5.80 0.20 www.general-carbon.com 4
  5. 5. Renewable Energy Certificates (REC)  REC is a tradable certificate of proof that one MWh of electricity has been injected (or deemed to have been injected) to grid by an RE generator.  MNRE approved renewable energy sources: Wind, Biomass, Small hydro, Solar, Bagasse based Co-generation, MSW, Biogas, Black Liquor  REC types & Price band: REC Non Solar Solar www.general-carbon.com April 2012 - April 2017 Rs 1,500 - 3,300 Rs 9,300 – 13,400 5
  6. 6. Who is eligible to participate in REC? www.general-carbon.com 6
  7. 7. REC Eligibility  Preferential tariff PPA ♦ Not eligible for 3 years if they cancel PPA ♦ Eligible if DISCOM cancels PPA or after expiry of PPA  Captive consumption ♦ Eligible if no promotional benefit  Concessional wheeling/transmission charges  Banking facility  Electricity duty waiver ♦ Not eligible for 3 years even if generator foregoes benefits ♦ Eligible if concessions are withdrawn by SERC  GBI and Accelerated depreciation benefits are not considered concessional www.general-carbon.com 7
  8. 8. REC Eligibility…..continued  REC and CDM benefits can coexist  Not available for off grid projects  Auxiliary consumption not eligible www.general-carbon.com 8
  9. 9. REC Process - Timeline NLDC Registration • RE Generator applies for registration of accredited project with NLDC • Process time: ~ 2-3 weeks Issuance • May apply fortnightly basis; within 6 months of injection to grid • Process time: ~ 3-4 weeks Power Exchange State Agency Accreditation • RE Generator applies to the State agency for accreditation upto 6 month before Commissioning • Process time: ~ 6-8 weeks • Last Wednesday of every month between 1300 – 1500 hrs Redemption www.general-carbon.com 9
  10. 10. Demand for RECs  DISCOMs ♦ Already procuring under preferential PPAs ♦ Impact on their bottom line  Open access consumers ♦ Inter-state plus intra-state (small segment)  Captive consumers ♦ Large market made up of industrial users (cement, steel, chemical etc.) having thermal capacity ♦ Likely to focus on RE development, RE PPAs or REC www.general-carbon.com 10
  11. 11. Our Services www.general-carbon.com 11
  12. 12. Service Insight RPO impact assessment REC Trading Issuance Registration www.general-carbon.com Accreditation Development of RPO compliance plan REC Development Advisory REC Market Insight 12
  13. 13. Assessment of impact of RPO  Renewable Purchase Obligation (RPO) is the minimum percentage of renewable energy share in the area of a ♦ Distribution Licensee ♦ Open Access Consumer ♦ Captive Consumer  RPO will impact you ♦ If you are buying power from the bilateral market or exchanges ♦ If you have captive generation capacity at your plants  Existing wind capacity where you are availing preferential wheeling and banking benefits will not be eligible to help you fulfill your RPO? www.general-carbon.com 13
  14. 14. Assessment of impact of RPO … continued  RPO regulations vary by state and distribution company; understand what applies to your units.  Assess total power consumption and identify power sourced from: ♦ Open Access (Bilateral or Exchange) ♦ Captive Generation  Compute any renewable power in your mix  Compute your RPO and therefore your shortfall www.general-carbon.com 14
  15. 15. Development of RPO compliance plan  Assess the options available ♦ Buy vs Build  Technology (Wind, Solar, Biomass, Small Hydro etc.)  Suitability of Technology  Cost of power from shortlisted technology  Regulatory support ♦ Petitioning / facilitate in regulatory clarification (e.g. inclusion of WHR / cogeneration projects as renewable)  RPO compliance cost ♦ Likelihood of enforcement ♦ Cost of procurement of REC  Finalize RPO plan www.general-carbon.com 15
  16. 16. RPO Compliance We help the obligated entities fulfill their RPO by assisting them: ♦ build their own renewable energy assets, ♦ acquire old assets, tie-up with renewable energy IPPs ♦ purchase of RECs from the exchanges. www.general-carbon.com 16
  17. 17. REC Development Advisory We advice and help Clients with accreditation, registration, issuance of REC projects. Specifically included in our services:  Completeness check and Due diligence for eligibility: ♦ Performing a thorough check for all mandatory requirements and a total quality control of the documentations that are to be submitted to State and Central Regulatory bodies. Advising Clients for every necessary action to be taken to fulfill the REC eligibility criteria.  Accreditation and Registration Support: ♦ Assisting Clients with the entire accreditation and registration procedure with the state & central agency respectively.  Assistance in Issuance of REC: ♦ Assisting Clients in filing application & compliance report for successful issuance of REC. www.general-carbon.com 17
  18. 18. REC Trading and Market Insight  We are deeply engaged in the REC market - We help clients with appropriate trading strategies and provide monetization support for their RECs.  We provide assistance for trading of the RECs on Power Exchange/s.  We are Members on both the approved Power Exchanges i.e. IEX and PXIL certified for trading RECs.  We trade RECs on behalf of: ♦ Eligible Entities (Registered RE generator) ♦ Obligated Entities (Discom, Captive Power Producer & Open Access Consumer) ♦ Voluntary Entities (Voluntary Corporates / Organisation / Individuals / etc) Membership Facilitation under RSM GC Advisory on Exchange www.general-carbon.com Open new bank account OR link current operating Account Trading on last Wednesday of every month Put Buy / Sell Bids: Quantity & Price (Anonymous Bidding) Bid matched based on approved exchange algorithm 18
  19. 19. Advantages RSM GC  Thought leaders ♦ Participated in regulation formulation (states as well as central) ♦ Sharing Insights through Monthly Newsletter: REC Market Update ♦ Invited to speak at major RE trade fairs, seminars, conferences & workshops  Helped in capacity building exercise in major states for REC  Managing over INR 750 million worth yearly REC transaction portfolio (buy & sell)  Some of the first & largest REC projects in their category  Shortest time for accreditation to registration www.general-carbon.com 19
  20. 20. Experience  Experience with over 8000 MWs power project portfolio ♦ Wind projects of over 2000 MWs across India ♦ Over 350 MW of REC projects across India  Client list includes some of the largest IPPs & CPPs in India ♦ Tata Power, Lanco, GVK, GMR, Renew, GreenKo, JSW, Mahindra, etc.  Broad spectrum of technological expertise ♦ Wind, solar, hydro, biomass, Waste to Energy, etc.  Executed projects under various structures ♦ APPC + REC, Captive, Third party sale, other exotic structures, etc www.general-carbon.com 20
  21. 21. Select Clients www.general-carbon.com 21
  22. 22. Contact Us Mumbai – Mr. Rameez Shaikh Chennai – Ms. Priya Ranganayaki 5th floor, Great Social Building 60, Sir Pherozeshah Mehta Road, Fort Mumbai 400001 E-3, 4th Floor, "RM Towers“ 108 Chamiers Road, Nandanam Chennai 600018 Phone: +91 22 2266 3201/3301 Mobile: +91 99200 33866 Email: rameez.shaikh@general-carbon.com www.general-carbon.com Phone: +91 44 42167331 Mobile: +91 99625 26876 Email: priya.v@general-carbon.com 22
  23. 23. Thank You www.general-carbon.com www.astuteconsulting.com

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