{"id":371,"date":"2011-07-05T11:10:45","date_gmt":"2011-07-05T05:40:45","guid":{"rendered":"http:\/\/reconnectenergy.com\/blog\/?p=371"},"modified":"2011-07-05T11:10:45","modified_gmt":"2011-07-05T05:40:45","slug":"significant-changes-are-proposed-in-the-rec-mechanism","status":"publish","type":"post","link":"https:\/\/reconnectenergy.com\/significant-changes-are-proposed-in-the-rec-mechanism\/","title":{"rendered":"Significant Changes are Proposed in the REC Mechanism"},"content":{"rendered":"<p>&nbsp;<br \/>\n<a href=\"http:\/\/www.nldc.in\/REC.aspx\">NLDC <\/a>and <a href=\"http:\/\/www.cbip.org\/\">Central Board of Irrigation and Power (CBIP)<\/a> organized a day-long workshop on the REC mechanism in Delhi in June.<br \/>\n&nbsp;<br \/>\nShri Pramode Deo, Chairman CERC was the key note speaker at the event. In his speech, he gave a preview of the significant changes expected in the REC mechanism. The highlights of these are:<br \/>\n&nbsp;<\/p>\n<ul>\n<li>Quarterly compliance of RPO to be put in place      soon\n<ul>\n<li><a href=\"http:\/\/reconnectenergy.com\/blog\/2011\/05\/rpo-compliance-may-be-required-more-frequently\/\">As we have mentioned earlier<\/a> in our newsletter and on this blog, this is a necessary step to make the market       function smoothly. The interesting point that Shri Deo made was that all       the regulatory requirements to implement this change quickly are in place       \u2013 as a result we may see quarterly compliance sooner that we expected.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li>Vintage based RECs to be considered,      particularly in Solar\n<ul>\n<li>This will help remove a major obstacle in       Solar investments. Faced with rapidly reducing capital costs, investors       opting for the REC mechanism face a sudden reduction in revenue as REC       prices are revised downward, even though they are locked-in with high       capital investment. A vintage-based REC will solve that problem. As an       example, a 2010 Solar REC may be made equal to 1.3X of a 2012 Solar REC       to factor in the higher capital investment required in 2010.<\/li>\n<li>Vintage based RECs are a common feature in international markets.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li>Electricity duty exemption clause to be      reviewed\n<ul>\n<li>A large number of units generating RE power       in captive mode are in-eligible for RECs as they enjoy ED exemption.       However, the ED exemption available and the REC revenue foregone are       disproportionate. At the same time, this clause is preventive entire       states and regions (like UP, Punjab and Vidharba) from participating in       the REC market.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<ul>\n<li>Consider Discom\u2019s to sell RECs when they      purchase RE in excess of their RPO requirement\n<ul>\n<li>This will be a welcome step, as this will       enable Discom\u2019s to lessen the burden of RE power purchase, particularly       as many are not in good financial health. However, this approach also has       risks \u2013 a Discom may disallow open access in the state and monopolize REC       trading. One way out could be to allow this only in states where open       access is allowed in its true spirit and form.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>&nbsp; NLDC and Central Board of Irrigation and Power (CBIP) organized a day-long workshop on the REC mechanism in Delhi in June. &nbsp; Shri Pramode Deo, Chairman CERC was the key note speaker at the event. In his speech, he [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[55,56,66,110,57,100],"tags":[60,128,84,95,129,130,76,64,65,67,69,78,131,132],"_links":{"self":[{"href":"https:\/\/reconnectenergy.com\/wp-json\/wp\/v2\/posts\/371"}],"collection":[{"href":"https:\/\/reconnectenergy.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/reconnectenergy.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/reconnectenergy.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/reconnectenergy.com\/wp-json\/wp\/v2\/comments?post=371"}],"version-history":[{"count":0,"href":"https:\/\/reconnectenergy.com\/wp-json\/wp\/v2\/posts\/371\/revisions"}],"wp:attachment":[{"href":"https:\/\/reconnectenergy.com\/wp-json\/wp\/v2\/media?parent=371"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/reconnectenergy.com\/wp-json\/wp\/v2\/categories?post=371"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/reconnectenergy.com\/wp-json\/wp\/v2\/tags?post=371"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}