The Central Electricity Regulatory Commission (CERC) has granted permission to modify renewable energy certificate (REC) agreements, resulting in alterations to the trading dynamics at both the Indian Energy Exchange and Power Exchange India Limited. This adjustment is intended to align REC contracts with the updated regulations for renewable energy certificates established in 2022. The commission has instructed the Grid Controller of India to arrange two renewable energy certificate trading sessions every month, specifically on the second and last Wednesday of each month, for the next six months, commencing from October.
The Commission has clarified that energy generated from renewable sources and sold by entities registered under the REC system in traditional power exchange contracts is eligible for REC issuance. While, power sold in the clean energy market segment at power exchanges will not qualify for REC issuance. Furthermore, the Commission opted to retain the existing pricing mechanism, the double-sided uniform price auction, for RECs in the market. This decision came after evaluating various suggestions for alterations, including the elimination of floor and forbearance prices, the introduction of reverse auctions, forward auctions, bilateral trade methods, and permitting both buyers and sellers to initiate auctions.
Additionally, the Commission has also approved REC fungibility, permitting obligated entities to meet their renewable purchase obligations by interchangeably utilising RECs from different renewable energy technologies.