REC trading for June was conducted today (June 27, 2012). Compared to last month, there were a few surprises:

  • Supply exceeded demand for Non-Solar RECs for the first time since start of trading
  • Demand for Solar RECs grew significantly

Detailed analysis of Non-solar REC trading:

Price on IEX remained the same as in May (Rs 2,402), while on PXIL it increased from Rs 2,150 to Rs 2,460 (increase of 14%). Aggregate demand reduced to 349,000 RECs from 365,000 last month (-4%). At the same time, supply of RECs increased from 275,000 to 361,000 (increase of 31%). Of these, 236,000 RECs were sold.

As mentioned above, this was the very first time that supply of RECs exceeded demand. Given the mismatch, it was good to see prices hold/ increase slightly. However, if the situation persists, the peak pricing has probably been reached until stronger enforcement signals emerge from the regulators.

Detailed analysis of Solar REC trading:

June was the second month when solar RECs were traded. Demand has grown significantly since last month (from 1,642 to 9,619; approximately a 6X growth). Available RECs increased to 563 from 249 last month (2.2X). Pricing fell marginally from the high of Rs 13,000 last month to Rs 12,750 on IEX and Rs 12, 506 on PXIL. 342 Solar RECs were sold, up from 10 RECs last month.

Total market value exceeded Rs 57 crore, of which Rs 44 lakhs were from Solar RECs.

The Hindu quoted Vishal Pandya of REConnect which covered the June trading news:
“The overall market growth in both solar as well non-solar space seems good. However, with the first quarter of the financial year getting almost over, it would be highly desirable now to see state regulators and nodal agencies acting strictly on the RPO compliance,” says Mr Vishal Pandya, Director, REConnect.

Other links which covered the trading news :