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Andhra Pradesh announces Renewable Energy Certificate regulations

According to reports, the Andhra Pradesh Electricity Regulatory Commission (APERC) has announced the much-awaited renewable purchase obligation (RPO) regulations, for 2012-13 to 2016-17. The main features of it are: RPO of 5 per cent, including a ‘solar RPO of 0.25 per cent’. The ‘average pooled purchase cost (APPC)’ has been determined to be Rs 2 a unit between now and May 31, 2012, “which is the ad-hoc notional pooled cost of power purchase of the previous year.” Distribution liecensee, open access consumers and captive power plants (1 MW and above) have been identified as ‘obligated entities’. Penalty for non-fulfilment of RPO will be on the basis of shortfall in units of RPO and forbearance price of RECs.

“The regulation is perfectly in line with the CERC guidelines,” says Mr Vishal Pandya, Director, REConnect, a consultancy that operates in the area of RPO. He points out that the APPC price excludes the cost of power purchased from liquid fuel-based plants. The APPC of Rs 2 is much lesser than Rs 2.37 in Tamil Nadu and Rs 2.73 in Karnataka. However, it holds only up to end-May, after which one might expect the APERC to announce a more remunerative price.

It is also seen that the RPO of 5 per cent is static for the five-year period. This is against the spirit of the intent of the National Action Plan for Climate Change, which wants to give a push to renewable energy by imposing an increasing obligation on specified buyers of conventional power.

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