According to reports, involving public sector units and providing incentives to buyers are the main challenges for creating voluntary markets for renewable energy certificate (REC) in India, said Pramod Deo, chairman of the Central Electricity Regulatory Commission.
He was speaking in a workshop on renewable energy certificate mechanism on Friday. REC is a market mechanism which helps states that do not have the potential to meet the minimum renewable energy purchase obligations set by the regulatory commission. Deo said a consortium needed to be formed by agencies involved in renewable energy generation and distribution in order to create awareness about the REC market.
The workshop, ‘Creation of voluntary REC market in India’, was organised by the World Institute of Sustainable Energy (WISE) and focused on how a voluntary REC market could be created in India so that more trading takes place.
Deo said, “REC trading has been in operation for more than a year in India and about 15 transactions have been carried out. However, it has been noticed that these transactions have been mostly carried out by government entities. We want more corporate houses to volunteer and do trading in the REC market. Only then will the REC market expand in India.”
Deo said the process of registration for REC was so cumbersome that even if corporates wished to trade they desisted from doing so. “WThere was an IT company which was keen on buying renewable energy in order to portray the green image of the company. However, eventually it realised that the process was cumbersome and backed out. So, w
e need to look at how we can make trading simple and hassle-free for everybody,” Deo said. He said that orders have been issued to public sector units across the country to buy green energy and make it a part of their corporate social responsibility.
G M Pillai, founder director-general, WISE, said, “There has to be some motivation for corporate houses to get involved in REC. A financial benefit or tax rebate will encourage them to be players in the market.”It is certain that renewable energy is going to undergo a major transformation by 2020, but for that we need to build enough awareness from now,” he added.