Renewable Purchase Obligation (RPO) in India

Renewables Obligation in UK was probably the first policy of its kind introduced in 2002 demanding the power suppliers to include renewable power sources in their portfolio.  Its contemporary in the US and other economies is the Renewable Portfolio standard. In 2010/11 renewables contributed to 11% of the power produced in the UK [1]. The US Govt. Is targeting a 3% production from non hydro renewable energy sources between 2011-2013 [2]. India took cue from these economies and adapted this policy in 2010 as Renewable Purchase Obligation (RPO). However the regulation, mandating a policy framework was made way back in 2003.  This is one policy that has been accepted and implemented worldwide in the last decade.

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The RPO in India was implemented as part of the National Action Plan for Climate Change (NAPCC) with an ambitious target of supplying 15% of the energy demand in the national grid by renewable by 2020.  The first target was to meet 10% by 2010 (I think by 2013 we have reached the figure) and an annual increase of 1% until 15% is reached by 2015. India like the US enforced the plan state wise, each state was given the responsibility of ensuring the implementation of this policy. The states in India brought independent policy frameworks for the implementation; wind energy id abundant in India and was specifically targeted with a contribution between 5-7%. Solar power was slatted to grow from a 0.5% in 2010 with an annual increase of 0.5%. The obligated entities were the public power distribution companies, the captive power consumers (Consumers who set up thermal power plants within their factory premises for own consumption, e.g. cement and steel plants) and Industrial consumers who were supplied dedicated power through high voltage distribution system.  Obligate entities could fulfil their requirement by setting up wind farms or solar power plants or they could buy Renewable Energy Certificates (REC) in the market, which is similar to the carbon credits policy and the Renewable Obligation Certificate in the UK. So, with the policy in place are we achieving the results? “Powering Ahead with Renewables: Leaders and Laggards”, the new report by Greenpeace is a timely report assessing the success of the Renewable Purchase Obligation (RPO) mechanism in India.

Overall the policy has failed to achieve the targets in the specified timeline. The failure can be attributed to different reasons but its main cause is lack of state government support in enforcing the regulation and penalising the defaulters. States had formulated the policy framework which expects a 0.5%-1% annual increase, but only 7 out of the 29 states in India have been able to achieve their annual targets so far. Other reasons include the lack of capital and heavily subsidised power for many consumers in the country.  Renewable Energy certificates (REC) have also failed due to the lack of available of renewable power resources which can generate these certificates in the market.

However, I still feel this policy of enforcing renewable power to be part of the energy mix should be adapted worldwide as it gives a perspective to gauge our development towards a sustainable future. In India’s case the 7 states which have achieved their targets have been a source of motivation for others to follow.

References

[1] Renewables Obligation -Wikipedia

[2] Renewable Portfolio Standard -Wikipedia

[3] “Powering Ahead with Renewables: Leaders and Laggards”-Greenpeace

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