This document discusses several policy issues related to clean energy in India and provides recommendations. It addresses inconsistencies in state-level open access policies, poor enforcement of renewable purchase obligations across states, the need for waste heat generation to be recognized as renewable, encouraging renewable energy use in buildings, issues with the PAT program, developing the energy service company model, and establishing a dedicated bank for financing energy efficiency projects. The recommendations generally focus on establishing consistent national policies, incentivizing renewable energy investment and use, and improving access to low-cost financing for clean energy projects.

1. 1
Accelerating Clean Energy
Policy & Business Model for Clean Energy Future
K N Rao
Director - Energy & Environment
ACC Limited

2. 2
ACC Limited EECC 12/6/2017
Open Access Policies – one nation one policy
12/6/2017
Issue Rationale Recommendation
 Central Govt / EC Act support
procurement of power through
Open Access; But different states
are reluctant to encourage it. Even
for states which OA is allowed,
frequent changes in policies /
Additional surcharges above cross
subsidy makes OA power usage
unviable / unpredictable
 No consistency of policies
across states / frequent policy
changes.
Additional surcharge is imposed in
some states even after cross subsidy
charges.
For OA consumers, any grid
consumption is charged at Rs 10/unit
considering it as a temporary supply.
Additional demand charge of Rs 40 is
levied.
States like Maharashtra, Chattisgarh,
Uttar Pradesh do not encourage OA
except for bilateral PPA.
•Consistency in policy
•Not to burden
industries/ OA
customers with
additional charges and
frequent changes in
policies

3. 3
ACC Limited EECC 12/6/2017
Renewable Purchase Obligation
12/6/2017
Issue Rationale Recommendation
 Poor enforcement of
RPO
 Presently all States
have Renewable Purchase
Obligation in varying
proportion. However
potential for RE generation
differs widely among
different states. Each state
requires RE project to be
installed in their state for
Captive consumption
 Many state Discoms do
not buy power from RE
generators which does not
incentivize investment in RE
All states do not have good
renewable energy potential
resulting in lower PLF and lower
returns. This does not favors large
corporate with plants in different
states to set up renewable energy
generation facility in each state.
•Direct deduction of levy of
REC obligation from
obligatory units just like GSTs
•For Large Corporate with
manufacturing units across
various states it would be
economical and viable to
have sizeable RE projects at
one or two locations and
generate RE power and meet
requirement of units across
other states
•Non compliant company‘s
trading may be stopped by
SEBI.
•Green Power corridor for
evacuation of Green power

4. 4
ACC Limited EECC 12/6/2017
Renewable Status for WHR
12/6/2017
Issue Rationale Recommendation
Very high payback Power generation from waste
heat requires 10-15 Cr / MW
and has a payback period of 6-8
years
Green status for power
generated from waste heat
will help in reducing the
payback period

5. 5
ACC Limited EECC 12/6/2017
Encourage RE Use in Buildings
12/6/2017
Issue Recommendation
Lower penetration of RE usage in
buildings
Tax benefits for owners who install renewable
energy sources such
• Solar roof top PV
• Biogas generation from waste
• Effective segregation and utilization of
waste
• Solar Wind hybrid in high rise buildings

6. 6
ACC Limited EECC 12/6/2017
PAT
12/6/2017
Issue Recommendation
• No floor price has resulted in market
crash for ESCerts (Currently trading at
Rs 200 per ESCert)
• Entire energy efficiency market has
collapsed
•Strict enforcement of compliance
• Power Ministry to intervene and
procure ESCerts during first cycle
from Clean Energy Fund to
sustain the ESCert price, and
release after second PAT cycle
when the demand is more.

7. 7
ACC Limited EECC 12/6/2017
Energy Service Company
12/6/2017
Issue Recommendation
 Presently Govt supported EESL is
the major player, successful only in
lighting projects
 No major projects were developed
with ESCO financing
Investors to be encouraged for
ESCO funding, with low cost
funding by Govt

8. 8
ACC Limited EECC 12/6/2017
Bank for Energy Efficiency
12/6/2017
Issue Recommendation
 Higher cost of capital increases
payback period of major energy
efficiency projects making it
unattractive.
 Energy efficiency projects are treated
like normal lending by the conventional
lenders
A dedicated bank, similar to
NABARD, which understands
energy efficiency projects may help
in providing finances at lower interest
rate to projects thereby accelerating
the implementation of Energy
efficiency improvement projects

9. 9
Thank You