MoP proposes redesigning of REC market

The MoP has released a discussion paper on redesigning the renewable energy certificate (REC) market to align it with emerging changes in the power sector and to promote new renewable technologies. The paper proposes to make RECs valid in perpetuity, instead of having a validity period. The REC holders would have complete freedom to decide the timing of the sale; therefore, forbearance prices may not be specified. The CERC will need to devise a monitoring and surveillance mechanism to ensure that there is no hoarding of RECs and artificial rise in market prices. Renewable energy generators will be eligible for REC issuance over a reduced 15-year period from the commissioning date of the project and existing renewable energy projects that are eligible to get RECs will continue getting it for 25 years. The ministry has sought comments and suggestions on the discussion paper by June 25, 2021.