Sale of green certificates dips 6.61% to 1.73 lakh in July

Sale of renewable energy certificates (RECs) has declined 6.61 per cent to 1.73 lakh in July compared to 1.85 lakh in the previous month.

India has two power exchanges approved by the Central Electricity Regulatory Commission -- Indian Energy Exchange (IEX) and Power Exchange India Limited (PXIL) -- which hold auction of RECs on the last Wednesday of every month.

According to statements issued by two exchanges, sale of 1,73,223 RECs were recorded on Wednesday including 1,24,824 RECs at IEX and 48,399 RECs at PXIL. Last month, 1,85,493 RECs were sold at the auction.

"The REC trading session on July 29 at IEX witnessed participation mainly from Captive Power Producers (CPPs) and Open Access consumers while majority of the distribution companies, that have the highest obligation to fulfill amongst all the obligated entities, continued to keep away from the Market," IEX said in a statement.

It further said that Wednesday's session saw trade of 1,24,824 RECs with an overall market share of 72 per cent.

In comparison to previous fiscals, this fiscal the market started on a high note mainly on account of Supreme Court's judgement directing the Captive Power Producers to comply with Renewable Purchase Obligation (RPO).

The market volume, however, decreased 17 per cent in July over the previous month when a total of 1,50,862 RECs were traded at IEX, it said in the statement.

The total cleared volume on PXIL was 48,399 RECs that led to the exchange having a market share of 27.90 per cent, PXIL said in a statement.

Prior to the auction, more than 1.45 crore RECs were available in the market for trade. However, the traded volume is low on account of non fulfilment of RPO compliance by major utilities, it added. I

It said that the traded volumes are expected to increase in the coming months as many obligated entities would start purchasing RECs to meet their RPO targets.

RPO is an obligation mandated by Central/State Regulatory Commission and is applicable to power distribution companies, open access consumer and captive consumers. They are under obligation to buy RECs from renewable energy producers to meet this norm.