Renewable energy regulatory framework

The development of grid interactive renewable power took off with the coming into force of the Electricity Act 2003 (EA 2003), which, among other things, provides for regulatory interventions for promotion of renewable energy (RE) sources through a) determination of tariff; b) specifying renewable purchase obligation (RPO); c) facilitating grid connectivity; and d) promotion of development of market.

The National Tariff Policy (NTP) 2006 requires the State Electricity Regulatory Commissions (SERCs) to fix a minimum percentage of Renewable Purchase Obligation (RPO) from such sources taking into account availability of such resources in the region and its impact on retail tariffs and procurement by distribution companies at preferential tariffs determined by the SERCs. NTP has further elaborated on the role of regulatory commission; mechanism for promoting renewable energy and timeframe for implementation, etc. The policy was amended in January 2011 to prescribe solar-specific RPO be increased from a minimum of 0.25 per cent in 2012 to 3 per cent by 2022. Further, the National Action Plan on Climate Change (NAPCC) suggests increasing the share of renewable energy in the total energy mix at-least up to 15 percent by 2020.

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