Renewable Energy Certificate (REC) mechanism is a market-based instrument to promote renewable energy and facilitate compliance of renewable purchase obligations (RPO). It aims at addressing the mismatch between availability of RE resources in state and the requirement of the obligated entities to meet the renewable purchase obligation (RPO). One Renewable Energy Certificate (REC) is treated as equivalent to 1 MWh.
Renewable Purchase Obligation (RPO):
It is the obligation mandated by the State Electricity Regulatory Commissions (SERCs) under the Act, to purchase minimum level of renewable energy out of the total consumption by the Obligated Entity.
There are two categories of RECs, viz., solar RECs and non-solar RECs. Solar RECs are issued to eligible entities for generation of electricity based on solar as renewable energy source, and non-solar RECs are issued to eligible entities for generation of electricity based on renewable energy sources other than solar.
Features of REC (Renewable Energy Certificate)
| Particulars |
Description |
| REC Types |
1. Solar REC |
| 2. Non-Solar REC |
| Trading Platforms |
CERC approved Power Exchanges |
| REC Equivalence |
1 MWhr |
| Validity |
1095 Days |
| Resale of Certificates |
Not Allowed |
| Banking |
Not Allowed |
| Eligibility |
Grid connected RE (Renewable Energy Technologies approved by MNRE (Ministry of New & Renewable Energy) |
| Trading Entities |
1.Eligible Entity
|
| 2.Obligated Entity
|
| 3.Voluntary Entity |
| Forbearance Price (Maximum Price) |
As per CERCs circular |
| Floor Price (Minimum Price) |
As per CERCs circular |
| Trade Date |
Last Wednesday of the month or as per the circular issued by the exchange (During Holidays) |
|