The Electricity Act 2003 (EA 2003) stimulated the development of RE based power generation by mandating State Electricity Regulatory Commissions (SERC) with the function of RE promotion within the State. Under EA 2003, the SERCs set targets for distribution companies to purchase certain percentage of their total power requirement from renewable energy sources. This target is termed as Renewable Purchase Obligation (RPO).
REC mechanism was proposed to enable and recognize the inter-State RE transactions is critically required for further promotion and development of RE sources.
In January this year, The Union Cabinet approved the proposal of the Ministry of Power to amend Para 6.4(1) of the Tariff Policy, which provides for Non-conventional sources of energy generation including co-generation. The present amendment in para 6.4(1) of the Tariff Policy is as per the proposal of the National Solar Mission strategy (Implementation of the National Solar Mission) which was approved by the Cabinet in its Meeting held on November 19, 2009.
According to reports, Steel Authority of India Ltd (SAIL) is exploring options to float joint ventures with ‘green’ power producers to meet its renewable energy commitment.
SAIL, one of the largest captive power producers, not only proposes to buy green power from renewable producers, but is also open for joint ventures for producing green energy, sources said.
SAIL produces about 600 MW yearly through its conventional captive units. As part of their renewable purchase obligation (RPO), the State utilities and captive producers are expected to source about five per cent of their requirement from green sources.
“Since our requirement is substantial, we are open to form joint ventures with companies in wind, solar, bio-mass and even small hydro projects,” sources said. The company has invited expression of interest from both domestic and global green power producing firms and expects to firm up its plans by the year-end.