Overview of indian renewable energy certificate mechanism

The Renewable Energy Certificate (REC) Mechanism has proved to be quite successful across the globe and is prevalent in many countries including the U.S., the U.K., Japan, Australia, etc.. It is expected to play similar role in promoting the renewable energy technologies in India. India has launched its REC Mechanism in November 2010. It is a pan India market based instrument and has been introduced to meet ‘Renewable Purchase Obligation (RPO)’ and ‘Voluntary'purchase of the RECs. REC Mechanism provides two different markets to the RE Generators - one from sale the electricity component as ‘conventional electricity’ and the other for the associated environmental attributes in the form of REC(s) and expected to bring about a paradigm shift for the renewable based electricity in future. The REC framework has been established and about 3400 MW capacity has been registered under the Mechanism. In March 2011, in the first trading session for RECs, the issuance of RECs was just 532. In February 2013, the twenty fourth trading session was held which witnessed the issuance of RECs crossing the 5 millionth mark. Though the RECs continue to hold promise, the market's performance has been weak in recent months. This paper presents a brief overview in terms of the concept, salient features, status, trends, issues and the way forward in the Indian Renewable Energy Certificate(s) Mechanism.