REC TRADE RESULTS NOVEMBER 2017

Non-solar demand was significantly higher than inNovember 2016, and also higher than last month. In total 22.07 lakh RECs were traded (745% higher than November 2016, and 353% higher than in October 2017), and clearing ratios on IEX and PXIL were 19.39% and 13.33% respectively. The increase in the number of RECs traded was partly because of the push by DISCOMs towards RPO compliance.

Trading of solar RECs  has been suspended due to the stay imposed by the Supreme Court.

 

REC TRADE RESULTS OCTOBER 2017

Non-solar demand was significantly higher than in October 2016, and also higher than last month. In total 4.87 lakh RECs were traded (90.78% higher than October 2016, and 27.51% higher than in September 2017), and clearing ratios on IEX and PXIL were 4.5% and 3.3% respectively. Solar RECs did not trade due to a stay imposed by the Supreme Court.

 

VALIDITY OF RECS WHICH WERE ABOUT TO GET EXPIRED BETWEEN OCTOBER ’17 AND MARCH ’18 GETS EXTENDED BY SIX MONTHS

The Central Electricity Regulatory Commission (CERC) has in its order dated 29/08/2017, declared that those Renewable Energy Certificates (RECs) which were expiring between 1st October 2017 and 31st March 2018 are now going to remain valid till 31st March 2018. In its order dated 30th March 2017, the commission had extended the validity of RECs which were going to expire between 1st April 2017 to 30th September 2017 till 31st March 2018.

 

The order  can be accessed here.

REC TRADE RESULTS SEPTEMBER 2017

Non-solar demand was significantly higher than in September 2016, and also higher than last month. In total 3.82 lakh RECs were traded (47.56% higher than September 2016, and 32% higher than in August 2017), and clearing ratios on IEX and PXIL were 3.56% and 2.36% respectively.

Overall, for the six months ended September, Non-solar demand is up by 11% compared to the same period last year. Solar demand is up by 27% despite reading only in April this year. Since then, trading has been suspended due to the stay imposed by the Supreme Court.

 

GUVNL’S BIDDING FETCHES TARIFF OF Rs 2.65

In a bidding which took place on 19th September 2017 for a 500 MW solar plant of Gujarat Urja Vikas Nigam Ltd. (GUVNL), the lowest price determined was Rs 2.65 per unit. This was slightly higher than the price of Rs 2.44 determined in the last reverse bidding by SECI. This increase in the price determined was attributed to the implementation of GST and the increase in the cost of solar panels being imported from China.

A continuous decreasing trend has been seen in the tariff determined for solar projects in the Country this year. The following graph determines the trend in prices of solar power determined in the past:

The article can be accessed here.

REC TRADE RESULT AUGUST 2017

Supreme Court allowed conditional trading of Non-solar RECs in an order dated July 14, 2017 . Demand was expected to be low for two reasons – 1) obligated entities are required to pay at old RECs rate (Rs 1500/ REC); and 2) compliance is required to be done by March to obligated entities have enough time to comply even after the final order of Aptel is received.

This is the second month when trading has taken place after CERC allowed conditional trading of Non-Solar RECs but the demand was not as robust as last time .

Non-solar demand was marginally higher than in August 2016 , and significantly lower than last month. In total 2.89 lakh RECs were traded (11.83 % higher than August 2016), and clearing ratios on IEX and PXIL were 1.05% and 4.96% respectively.


Solar RECs were not traded as the stay imposed by the Supreme Court remains in force in the case of Solar RECs.

DERC NOTIFIES RPO REGULATION

The DERC has released draft RPO regulations in an order dated 28/07/2017. Following are the salient features of the regulation:

 

  1. RPO Compliance:

  • Aggregate from the gross purchases from generating stations by Obligated entities shall be considered as the quantum of RE purchase for RPO compliance.

  • All the power produced from Waste-to-energy plants shall be procured by the distribution licensee. This will also contribute towards RPO compliance.

  • Quarterly reports shall be submitted by the obligated entities which will include parameters such as capacity addition, generation and purchase of electricity from RE sources. The same shall also be posted on their website.

  1. Role of SNA:

 

  • Protocol development for regular information collection from RE generating companies, obligated entities, SLDC, chief electrical inspector, ets.

  • RE procurement and RPO compliance reports on a monthly basis by obligated entities which shall also go on their websites. This shall be done by the 10th of the next month.

  • It shall also receive information on or before 30th April from captive users who are consuming electricity generated from captive generating plants about electricity consumption and purchase from RE sources.

  • The same shall be applicable for open access consumers.

This regulation isn’t very different from the previous RPO regulation which was released in October 2012.

The order can be accessed here. The public notice can be accessed here.

APERC DETERMINES WIND AND SOLAR FORECASTING AND SCHEDULING REGULATION

Andhra Pradesh Electricity Regulatory Commission (APERC) has released its forecasting, scheduling and Deviation settlement of solar and wind generation on 21/08/2017.

Executive Summary:

★ Applicability:

○ Regulation is effective from Aug 21st, 2017.

○ SLDC to issue detailed guidelines for QCA registration, scheduling procedures, communication protocols and formats etc., on or before Dec 1st, 2017.

○ Forecasting, Scheduling and Deviations Settlement shall commence from Jan 1st, 2018.

Further, generators commissioning on or after Jan 1st, 2018 shall not be allowed to be commissioned unless they start providing schedules as per this regulation.

○ Levy and collection of DSM Charges shall commence from Jul 1st, 2018

★ Regulation Applicable on: All the GRID Connected Wind and Solar Power Generators in AP.

★ Deviation Accounting:

★ Point of Forecasting: Pooling Station or STU/DISCOM Feeder where injection is made.

★ Virtual Pool: To enable benefits of larger geographical area and diversity, aggregation of forecast is permitted under “Virtual Pool” where Generators have an option to account for their deviations at an aggregated level through a Qualified Coordinating Agency (QCA).

○ A similar provision is also permitted in Karnataka by Hon. KERC in its final regulation which is already being implemented w.e.f 1st June 2017.

 

★ Role of a QCA:

○ Provide forecast, schedules and periodic revisions;

○ Coordination with DISCOM/STU/SLDC for metering, data collection, communication/issuance of dispatch/curtailment;

○ Commercial settlement of DSM charges and de-pooling of charges among generators;

○ All other ancillary and incidental matters.

★ Important differences between wind and solar power scheduling:

○ 16 revisions (excluding collective transactions) are permitted starting from 00:00 Hrs of the     day for Wind Generators

○ 9 revisions (excluding collective transactions) are permitted starting from 05:30 Hrs upto 19:00 Hrs of the day for Solar Generators

○ All the revisions are effective from the 4th time-block

○ Aggregation “seems” to be allowed between wind and solar generation as the concept of virtual pool aims to capture not only the larger geographical area but also the diversity (among different asset class).

 

★ Important differences between intrastate and interstate transactions:

○ Wind and Solar generators having common interface meter at a pooling station but carrying out both – interstate and intrastate transactions at the same pooling station, the scheduling for the same shall to be carried out separately.

○ Approved open-access capacity (in MW) in such cases alone shall be considered as AvC for the purpose of DSM charges calculations.

■ Observation: Since the regulation permits common interface meter for such transactions and AvC determination is also clarified, the DSM charges may be computed in pro-rata basis for such pooling station as the common interface meter would only provide Pooling Station level actual generation.

 

○ Further, aggregation is permitted only for similar type of transactions i.e., interstate transactions are not allowed to be aggregated with intrastate transactions for the purpose of DSM charges determination.

○ QCA shall separately settle DSM charges for intrastate and interstate transactions.

★ Determination of DSM Charges for INTRASTATE transactions:

Note: DX is the absolute error in kWh for a given error band starting from X% as outlined in column 2.

 ★ Determination of DSM Charges for INTERSTATE transactions: 

Note: DX is the absolute error in kWh for a given error band starting from X% as outlined in column 2.

CERC REJECTS IEX’S PROPOSAL FOR GDAM

The Indian Energy Exchange (IEX), so as to provide the obligated entities more number of ways to fulfill their RPO compliance, had proposed to the CERC to allow the existing renewable energy generators to trade RE on IEX.

 

For the same, it had proposed that the following contracts including Green Day Ahead Market (G-DAM) which includes Solar and non-solar day ahead market be introduced. If the bid made in the G-DAM is not cleared or cleared partially, they can bid in DAM. Also, in lieu of the bid cleared in DAM, the seller will get equal number of RECs.

This order was rejected by the CERC and the following reasons were given for the same:

  • As per CERC, the status regarding the availability of surplus power is not clear. Also, based on the experiences in the past, it can be established that such trade will not lead to addition of new RE capacity.

  • The IEX has supposed that there are no discrepancies in the forecasting and scheduling for RE generators which is not the case. Therefore, their suggestions of remove the need for revision flexibility during the day is not valid.

  • Based on the suggestions of IEX which mentioned that in case if the bid made in the G-DAM is not cleared or cleared partially, they can bid in DAM, it can be assumed that the situation will lead to registration of RE sellers for FIT route as well as REC mechanism. This will demand that a system be established where there is proper accreditation, registration, accounting of RE generation and settlement mechanism.

  • The G-DAM market may dissuade the buyers from entering into long term contracts which provide comfort to RE investors.

  • The guidelines related to the timelines for scheduling of power traded will have to be amended as per IEX which the commission felt will be an unnecessary step right now.

  • IEXs recommendations assume that the the green power traded in G-DAM will follow the same scheduling procedure as that followed by conventional power. Therefore, the commission feels that there is no need to introduce a separate segment for trading.

The order can be accessed here.

REC TRADE RESULT JULY 2017

Supreme Court allowed conditional trading of Non-solar RECs on July 14, 2017 (our blog on the same can be accessed here). Demand was expected to be low for two reasons – 1) obligated entities are required to pay at old RECs rate (Rs 1500/ REC); and 2) compliance is required to be done by March to obligated entities have enough time to comply even after the final order of Aptel is received.

However, demand for Non-solar RECs was robust. In total 4.95 lakh RECs were bought (110.76 % higher than July 2016), and clearing ratios on IEX and PXIL were 4.31% and 3.52% respectively. Higher demand was primarily driven by demand for some utilities where state regulators had given RPO enforcement orders in recent months.

Solar RECs were not traded as the stay imposed by the Supreme Court remains in force in the case of Solar RECs.
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