Demand for non-solar RECs in India falls in March, new prices from April

Demand for solar renewable energy certificates (RECs) in India increased in March to 143,622 units sold, up by 190% month-on-month, while non-solar RECs sales fell by 15% to 888,703.

From the start of April there are new forbearance and floor prices for both types of certificates (as shown in the table below), approved by the Central Electricity Regulatory Commission. In March, the last month of India’s fiscal year, REC trading usually surges but this time the decrease in the floor prices from April 1 has had its effect on demand.

For several years RECs in India have been trading at floor prices because certificate supply is much greater than demand. Indian consultant REConnect Energy Solutions Pvt warned in a post last week that regular price cuts for the certificates serve as an incentive to delay purchase of RECs, and the weak enforcement of the Renewable Purchase Obligations (RPO) is not helping either.

Under the REC scheme, renewable power producers in India receive credits for the power they produce if they do not take advantage of other incentives. The RECs are traded on the last Wednesday of each month, sold to entities that are obliged to use a certain percentage of renewable power.

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