REC Trading Report July-2014

REC trading session of July-14 was conducted on 30th July 2014.  Below is a summary of the result:-

The total transaction value of non-Solar RECs reached 47.7 INR million and for Solar RECs was 61.5 INR million. The closing balance of RECs showed a whopping increase of 1.3 million in Non Solar RECs and 0.05 million in Solar RECs. The demand in PXIL fared better in PXIL than IEX for Solar this month. The clearing ratio for PXIL in Solar was 5.5 % whereas for IEX it showed 0.28%.

 Non Solar REC

The demand was to the lower side as Total RECs issued were 1.38 million whereas Total Redeemed was 31809 RECs. The demand took a dive by 77% as compared to the month of June. The supply rose by a whopping margin of 235% as compared to June. Non Solar price remained at 1500 INR (Floor Price). This month showed the highest number of issuance of RECs for the financial year. More insight can be seen in the graphical chart below.

 

 

Solar REC

Total RECs issued this month was 55545 whereas the total redeemed was 6633. It rose by 301% w.r.t June whereas, supply shot up by 23%w.r.t.  June session. The solar demand tripled as compared to previous month.  More details can be seen in the graph.

 

Market Clearing Percentage

 

Credits by: Bloomberg NEF

Contributed By: Cigil

DERC hikes power tariff in Delhi

DERC in its order dated 17th July, 2014, approved a tariff hike of 8.32% for three DISCOMs, namely BSES Yamuna Power (BYPL), BSES Rajdhani Power (BRPL) and Tata Power Delhi Distribution Ltd (TPDDL), while the tariff for NDMC has been hiked by 9.52%. Since Delhi has recently notified the open access charges in December, 2013 the tariff hike would increase the leverage to an open access consumer (1 MW and above) to procure cheaper power from the open market.

The other major features of the order include:

  • As a move to help DISCOMs to liquidate the principal of their accumulated deficit, DERC has decided to continue with the surcharge of 8% for all the four DISCOMs including NDMC.

ToD tariff extended for all consumers. This would enable utilities to adopt various DSM measures that would help in lowering the peak demand and thereby reducing costly power purchase.

  • Also an additional surcharge, varying from Rs 0.30/kWh to Rs 3.00/kWh has been levied on purchase of power through open access, there is still potential for an open access consumer in Delhi to purchase power through Power Exchanges such as IEX for six months in a year.
  • The purchases of energy from renewable sources through open access has been exempted from wheeling, transmission and additional surcharge. Thus, the open access consumers can avail green power to procure cheaper power. Many large consumers in Delhi have already started filing open access applications for availing open access.
  • It is anticipated that the recent tariff hike would act as a catalyst in promoting open access in Delhi and large industrial and commercial consumers would flock to PXs and bilateral transactions to reduce the impact of the tariff hike.

The orders can be accessed here.

Contributed by Mithun Dubey

CSERC Drafts RE Tariff for FY 2014-15

Chattisgarh State Electricity Regulatory Commission (CSERC) has released a draft on 18th July 2014 for the determination of preferential tariff for Renewable Sources of Energy. The commission has invited comments and suggestions latest by 12th August 2014 and a public hearing will be held for the same on 22nd August 2014.

The details of the proposed tariff are highlighted in the table below:

The tariff proposed by the CSERC is in line with the tariff determined by CERC (Refer). CSERC has reduced the solar tariff compared to previous years, whereas there is slight increase in tariffs of other RE sources.

The CSERC draft can be accessed be here

Our Previous Blog on CERC RE Tariff can be read here

Contributed by Dheeraj Babariya

Tripura Draft Amendment in RPO Regulation

Tripura Electricity Regulatory Commission (TERC) on 18th July 2014 has notified a draft for the amendment in its Renewable Purchase Obligation (RPO) compliance Regulation 2010. In this amendment, TERC has proposed RPO percentages for the next three years (i.e. till FY 16-17).

It is clearly visible that the TERC in the proposed draft has reduced its total the RPO percentage for 2014-15, as compared to 2013-14, but has increased the percentage of Solar RPO significantly. The decrease in the total RPO may be adjudged to the lack in Renewable Energy generation in the state and the increased solar RPO percentage shows that the state commission is setting an ideology to improve the solar energy generation in the state.

The proposed draft can be accessed here.

Contributed by Dheeraj Babariya.

APERC Approves Fixed Cost Tariff for Biomass

APERC (Regulatory Commission for the states of Andhra Pradesh and Telangana) on 19th July 2014 has rolled out an order determining the fixed cost component of the tariff Payable for the Biomass from the 11th year to 20th year of Operation.

The Details on the tariff approved is as below:

The average escalation is 4.7% over the 10 years.

The Honourable commission has ordered that an incentive of Rs 0.50 per unit for all generation above 80% PLF shall be paid by the concerned DISCOM to the all such generators. The commission also directed that the Electricity Duty paid by the Biomass project developers during this period shall be reimbursed.

More detail on the order can be accessed here.

Our previous blog post on the variable cost here.

Contributed by Bhanu Tejja

Karnataka: Approved Tariff for Biomass Projects

Karnataka Electricity Regulatory Commission (KERC) through an order on 10th July 2014, has determined tariff for Air Cooled Condenser based Biomass Projects. The order has come in response of a petition filed by M/s Haveri Bio Energy Pvt. Ltd.

A hearing was held on 15th May 2014. After hearing all the respondents the commission approved the final tariff, the details of which is shown below:

The average of the tariffs works out to be Rs. 5.54/KWh. This tariff shall be applicable for all the Air Cooled Condenser based Biomass Projects achieving commercial operation in the period from 01.04.2014 to 31.03.2018.

The relevant order can be accessed here

Contributed by Dheeraj Babariya.

JERC Drafts Solar Tariff Regulation

Joint Electricity Regulatory Commission (JERC) for Goa and Union Territories (UT) on 4th July 2014 has released a draft Regulation of Solar Tariff applicable to Ground Mounted Grid Connected & Rooftop Solar with Net Metering. The regulation shall be applicable to all grid connected Solar PV (including rooftop PV) and solar thermal projects of Goa and the Union Territories.

The primary objective of the policy is to reduce the power deficit in the Union Territories through Solar Power generation. The policy aims to replace diesel power generation by solar power.

Overall the policy is a good initiative by JERC to reduce the dependency on diesel generators. In the recent meeting of Forum of Regulators, emphasis was laid on Solar Rooftop and Net Metering. It can be expected that various SERC’s may come up with their Solar Rooftop and Net Metering policies, which will definitely encourage the sector, that may face tough times ahead after AD was reintroduced for Wind Power.

The Draft Regulation can accessed here.

Contributed by Dheeraj Babariya.

PSERC Draft RE Tariffs for FY 2014-15

Punjab State Electricity Regulatory Commission (PSERC) has released a draft for determination of tariff for Renewable Energy sources on 11th July 2014. PSERC has Invited comments and suggestions by 6th Aug 2014.

The graph below shows a comparison between tariff’s of CERC and PSERC over last three years (note that the tariff of PSERC for FY 14-15 is proposed and not approved).

It is evident from above that the tariff of PSERC over the period is same as the tariff determined by CERC. So it can be presumed that the final tariff of PSERC for FY 14-15 could be same as tariff determined by CERC. It is worth noting that the tariffs for Wind and Hydro have been marginally increasing over the last 3 years, which is contrary to the trend for Solar.

For further details please refer here.

Contributed by Dheeraj Babariya.

Forum of Regulators discusses Issues of RRF

The 41st meeting of Forum of Regulators held on 27th June 2014 at Delhi. A presentation on the issue “Grid Integration of Renewable Energy Sources” was made by Mr. S.K. Soonee (CEO, POSOCO/NLDC). The mandatory requirement of Forecasting and Scheduling was also been emphasized by regulators present in the meeting.

The key insights related to RRF (Renewable Regulatory Fund) are highlighted below:

  • Forum suggested that the RRF should be put in place to ensure grid discipline.
  • MNRE stressed that when commercial mechanism is suspended, the reaming issues including stabilizing the RRF mechanism, should be taken up on priority.
  • It was emphasized that besides Gujarat, installation of ABT meters has to be implemented in all other wind rich states before the commencement of RRF operations.
  • Emphasis was laid on the need of flexible generation, Forecasting and Scheduling of variable Renewable Energy, and developing Renewable Energy Management Centres (REMC’s).
  • The plan of developing Green Energy Corridors for strengthening RE evacuation and Grid stability was also discussed.
  • It was shown that the change in wind generation is having a negligible effect on deviation from schedule.

It can be inferred from the insights of the meeting that the Regulators are keen to bring the RRF mechanism in force (to ensure gird security) but before that, the Regulators are keen on ensuring that all key hurdles are cleared. Also Regulators have shown their positive response towards Grid Integration of Renewable Energy Sources.

 More information can be accessed here

 Contributed by Dheeraj Babariya.

Forum of Regulators discusses Issues of RPO

Forum of Regulators (FOR) held its 41st meeting on 27th June 2014, in Delhi. The Ministry of New and Renewable Energy (MNRE), through a presentation, raised several issues concerning Renewable Purchase Obligation (RPO).

The Key issues highlighted in the presentations are as below:

  • MNRE suggested that the validity REC’s should be extended by 6 months, arguing that a total of 50059 REC’s will expire in next six months.
  • It was suggested that MNRE could consider purchasing the unsold REC’s by using National Clean Energy Fund.
  • The Floor price of Solar REC’s can be reduced due to drastic change (reduction) in Solar PV tariffs over last three years.
  • Giving “MUST RUN” status to RE generation, so that total RE generation could be evacuated, and  have a provision of “Deemed Generation” in case SLDC asked RE generators to back down.
  • Due to poor RPO compliance in all states, the members agreed upon the need of strong RPO enforcement.
  • RPO compliance cost should be allowed in ARR (Average Revenue requirement).
  • The issue of allowing DISCOM’s to purchase REC’s for procuring Renewable Energy beyond their RPO targets was also discussed.
  • The forum suggested that a concept of Renewable Generation Obligation (RGO) for conventional Thermal power plants need to be introduced.
  • Suggestions were given on considering power generated from Large Hydro Projects as Renewable Energy.
  • The Forum also suggested that the concept of Hydro Power Obligation should be introduced.

 From the issues discussed in the meeting it can be deduced that the regulators may come up with strong steps towards RPO compliance. Also, the regulators are set to promote RE generation by making provision for providing proper transmission network for RE generation.

 More information can be accessed here.

 Contributed by Dheeraj Babariya.

 

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