Non-solar REC buy bids in India jump 60% M/M in Aug

Aug 28, 2014 - Demand for non-solar renewable energy certificates (RECs) in India improved to 50,681 units redeemed in August, up by 59% month-on-month, according to data from the REC Registry of India.

Despite the increase, non-solar REC inventory expanded further to 9.03 million units after nearly 557,000 new certificates were issued for the month. Due to the huge gap between supply and demand, these RECs have been trading at the floor level of INR 1,500 (USD 24.8/EUR 18.9) apiece since August 2012.

As for solar RECs, the number of redeemed certificates in the August trading session, which took place yesterday, dropped to 1,163 from 6,633 in July. After the issue of 53,656 new certificates for the month, the total inventory arrived at 341,276. Solar REC prices have also been trading at the lowest price allowed under the REC mechanism, INR 9,300 apiece, since June 2013.

Under the REC scheme, companies that produce renewable power in India but do not take advantage of feed-in tariffs receive one REC per MWh generated. The RECs are traded on the last Wednesday of each month on the Power Exchange India Ltd (PXIL) and the Indian Energy Exchange (IEX). Utilities and certain other power consumers are obliged under the renewable purchase obligation (RPO) to buy RECs or produce green electricity alone to help offset their environmental footprint. However, the poor enforcement of the RPO so far has affected significantly the functioning of the REC trading mechanism.

(INR 100 = USD 1.654/EUR 1.252)

Choose your newsletter by Renewables Now. Join for free!