Renewable Energy Certificates in Himachal Pradesh Role of HP regulator and Government By : Navneet Khokhar

PwC Agenda Section one : Role of SERC for promotion of RE (under E-Act’03) Section two : Role of SERC for promotion of RE (under NEP) Section three : Role of SERC for promotion of RE (under NTP) Section four : Role of SERC (under CERC-REC mechanism) Section five : Steps initiated by HPERC (under REC mechanism) Section six : Additional steps to be undertaken by HPERC (under REC mechanism Section seven : Role of State Government 2 4 May 2011

PwC Role of SERC for the promotion of RE (under E-Act’03) 3 1

PwC Provisions under E-Act’03 Act preamble records “ promotion of efficient and environmental benign policies ” Promote co-generation & generation from RE by: Suitable measures for connectivity with the grid ; Sale of electricity to any persons, & also Specify, for purchase of electricity from RE, a percentage of the total consumption of electricity in the area of a distribution licensee. To regulate through agreements for purchase of power for distribution and supply within the state : Electricity purchase; Procurement process of distribution licensees; Price at which electricity shall be procured from the generating companies /licensees /from other sources 4 Section 86 (1) (e) Section 86 (1) (b)

PwC Provisions under E-Act’03 Contd..... Specify the terms and conditions for the determination of tariff Guided by the need for promoting co-generation and generation of electricity from the RE sources Promote development of market (including trading) Make regulation providing for : Manner by which the development of market in power including trading 5 Section 61 (h) Section 66 Section 181 (2)(zi)

PwC Role of SERC for the promotion of RE (under NEP) 6 2

PwC Provisions under National Electricity Policy Such percentage for purchase of power from nonconventional sources should be made applicable for the tariffs to be determined by the SERCs at the earliest Progressively the share of electricity from non- conventional sources would need to be increased as prescribed by SERCs. Considering the fact that it will take some time before non- conventional technologies compete, in terms of cost, with conventional sources, the Commission may determine an appropriate differential in prices to promote these technologies. SERCs may promote arrangements between the co- generator and the concerned distribution licensee for purchase of surplus power from such plants

PwC Role of SERC for the promotion of RE (under NTP) 8 3

PwC Provisions under National Tariff Policy Clause 6.4 Pursuant to provisions of section 86(1)(e) of the Act, the Appropriate Commission shall fix a minimum percentage for purchase of energy from non-conventional sources taking into account availability of such resources in the region and its impact on retail tariffs. Such percentage for purchase of energy should be made applicable for the tariffs to be determined by the SERCs latest by April 1, Clause 6.4 (1)

PwC Role of SERC (under CERC – REC Mechanism) 10 4

PwC Role of SERC : State Agency 11 SERC Designate SA Direct SA in regard to discharge of its functions Fix remuneration & charges payable to SA

PwC Functions of State Agency Accreditation & recommendation of the project for registration 12 1

PwC Functions of State Agency Accreditation & recommendation of the project for registration Submit quarterly status report for the compliance of RPO by the obligated entities & suggest appropriate actions to SERC for RPO compliance 13 12

PwC Functions of State Agency Accreditation & recommendation of the project for registration Submit quarterly status report for the compliance of RPO by the obligation entities & suggest appropriate actions to SERC for RPO compliance Procurement of RECs from power exchange in case of default by obligated entities

PwC Role of SERC : RPO 15 Specify RPO levels (Solar & non-solar) Recognize REC as valid instrument for RPO compliance Definition of Obligated Entities Determination of default deposit amount Directions to obligated entity w.r.t RPO compliance

PwC Steps initiated by HPERC (under REC Mechanism) 16 5

PwC Steps initiated by HPERC In Right Direction 17 ParticularsStatus ( = Yes) RPO specified (Solar & Non- Solar) Recognition of RECs as valid instrument for RPO compliance Clear definition of obligated entities State agency designated Enforcement mechanism for non-compliance of RPO Fixation of fees & charges payable to state agency

PwC Additional Steps to be undertaken by HPERC (under REC Mechanism) 18 6

PwC Additional Steps to be undertaken 19 Steps Specific determination of Pooled cost of power purchase Set solar RPO in line with JNNSM Facilitate educating Obligated Entities regarding RPO compliance Stipulate/provide formats for quarterly status for RPO compliance

PwC Role of State Government 20 7

PwC Role of State Government Technology specific resource assessment studies To facilitate commission in fixation of RPO 1 Formulate RE policies (Technology specific) For the promotion of RE projects in the state 2 Single window clearance provisions for RE projects Accelerated implementation 3 Facilitate power evacuationSupport in development of transmission/ sub transmission infrastructure 4 Favourable land allotment scheme Attract developers 5 21

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