Cement, Energy and Environment

included the mandatory application of quality characteristics to fuels. The National Action Plan on Climate Change announced by the Prime Minister of India in the year 2008 advocates a greater use of Renewable Energy in the country. It targets a minimum of 5% RE in the supply mix of the entire country by 2010, 15% by 2015 and 20% by 2020. To fulfill the ambitious target new renewable energy policy is introduced. In terms of the policy, obligation has been cast on certain categories of power producers/ generators to either generate power from renewable energy source or purchase Renewable Energy Certificates (RECs) from the market. Captive Power Plant (CPP), which is producing power for own consumption and selling will be liable for renewable energy purchase obligation (RPO). Accordingly, most of the cement units having CPPs is liable for Renewable energy obligation. This obligation will also be applicable when power is being purchased through Indian Energy Exchange (lEX). However power taken directly from state electricity board is not covered under Renewable energy obligation. The Price f or Solar REC Floor Price ~9.300 (€155) Forbearance Price ~13,400 (€223) percentage of renewable energy obligation increases every year for solar. POLICY The nature and quantum of Renewable Energy obligation is specified by the State Government. Certain states have cast separate obligations for renewable energy from solar and from non-solar sources. In line with RPOs, there are two categories of RECs - solar and non-solar. Solar RECs include both PV and CSP technologies. Non-solar RECs include a basket of renewable energy technologies such as wind, biomass, bio-fuel cogeneration and small hydro. RECs are traded on the Indian Energy Exchange (lEX) and the Power Exchange of India Ltd. (PXIL). 1 REC = 1MWh. Every MWh of solar energy produced generates one REC. Solar RECs are traded. The trade price is discovered based on their demand and supply. In addition, and in order to provide a minimum of certainty on REC prices, the Central Electricity Regulatory Commission (CERC) has fixed a floor and forbearance price for the period 2012 to 2017 between which the RECs can be traded. Renewal Energy Obl igation for Solar in cement producing St at es State 2010-11 (%) 2011-12 (%) 2012-13 (%) 2013-14 (%) 2014-15 (%) 2015-16 (%) Madhya Pradesh Andhra Pradesh Rajasthan 0.50 Chattisgarh 0.25 Gujrat 0.25 0.5 Kamataka 0.25 0.25 Tamilnadu 0.15 0.05 Maharastra 0.25 0.25 Meghalaya 0.20 0.30 Note of CERC Pol icy: Captive REC The Commission had notified the CERC (Terms and Conditions for recognition and issuance of Renewable Energy Certificate for Renewable Energy Generation) Regulations, 2010 (hereinafter CERC REC Regulations) vide No. L-1/12/2010-CERC Dated: 29th September, 2010 . Amendment of Regulation 5 of principal regulations: The following provisos shall be added at the end of the Sub-clause (c) of Clause (1) of Regulation 5 of the principal regulations, 0.4 0.6 0.8 1.0 0.25% 0.25% 0.75 0.25 0.5 1.0 0.25 0.25 0.25 0.25 0.10 0.25 0.50 0.50 0.50 0.40 Solar Power Plant can be established as CPP with the following conditions. • Captive Power Producer (CPP) based on renewable energy sources shall be eligible for the entire energy generated from such plant including self consumption for participating in the REC scheme subject to the condition that such CPP has not availed or does not propose to avail any benefit in the form of concessional/promotional transmission or