Overview
The International Tracking Standard Foundation (I-TRACK Foundation) follows the laws and regulations of national actors in all markets with Accredited Market Facilitators.
During the course of transitioning local issuance responsibilities for I-REC(E) in India from the Green Certificate Company (GCC) to ICX, the I-TRACK Foundation was provided a more precise interpretation of recent policy directives affecting the treatment of registered I-REC(E) facilities under the national renewable purchase obligation (RPO).
As with any potential regulatory claim on the attributes of renewable energy generation from registered facilities, this will require additional documentation from Registrants and additional reviews by ICX and GCC to ensure that no I-REC(E)s are exposed to double-counting risk. These process changes are described in more detail below.
We appreciate ICX’s rigorous review of the local regulatory environment. ICX was accredited and appointed as Local Issuer for India by the I-TRACK Foundation, with the expectation of bringing just this level of expertise and experience to the role, using their knowledge of national and local legislation to issue I-REC(E)s in accordance with the Code. The process benefits arising from these local insights will strengthen the integrity and accuracy of Indian I-REC(E)s and contribute to a more robust global I-REC(E) market.
We would like to take this opportunity to remind Registrants and project owners of their responsibility to remain aware of local power market regulations and ensure declarations made during facility registration or issuance request are accurate and comprehensive. It is worthwhile to highlight that the issuance of I-REC(E)s through the Evident Registry is public and thus may be subject to independent external scrutiny.
Summary of RPO Regulation as Clarified by ICX
A 2022 Ministry of Power order defined large hydropower plants (LHPs) of at least 25MW as renewable energy sources. The same order formalised a hydropower purchase obligation (HPO) as a subset of the general non-solar RPO (containing technology specific targets for wind, hydro, and ‘other’ renewable sources) on distribution companies and other designated consumers. The 2022 order mandated that the HPO could only be met by power from LHPs commissioned after March 8, 2019. Older LHPs and other renewable sources not captured in the ‘wind’ or ‘HPO’ categories could be used to meet the ‘other’ renewables obligation of the RPO.
A subsequent Ministry of Power order issued in 2023 modified these terms, requiring that from April 2024, the HPO could only be met by hydropower projects (including pumped storage projects and small hydropower projects) commissioned after March 31, 2024. Any hydropower projects (of any size, i.e. no longer subject to the 25MW minimum) commissioned on or before that date can be used to satisfy the ‘Other RPO’ requirement.
Process Updates
These clarifications definitively identify hydropower, as well as other renewable energy generation facilities in India, as potentially subject to various RPO regulations. While this will require additional scrutiny of I-REC(E) issuance requests, we do not expect many facilities in India to be excluded from issuance due to RPO requirements. Rather, Registrants will need to provide additional evidence demonstrating the energy generation underpinning an issuance request was not being used by the buyer to meet RPO requirements.
Additionally, ICX and GCC are in the process of conducting a regulatory audit of all registered facilities in India to re-evaluate double-counting exposure linked to the RPO. Facilities must undergo this regulatory audit before new issuance requests are approved.
We do not expect a significant proportion of facilities to be affected by this audit. As of 20 November 2024, of 435 new and existing facilities reviewed, only 13 (2.9%) have been denied registration or issuance. For most facilities, the regulatory review results in a clarification of the total generation eligible for I-REC(E) issuance due to RPO exposure or banked generation with the grid, rather than outright rejection.
Resources
On 28 October 2024, ICX, GCC, the I-TRACK Foundation, and Evident hosted a webinar detailing the policy clarifications and related evidentiary requirements, attended by over 90 market participants.
The most current information on issuance restrictions for India is available on Evident’s issuance guidance page.
For any questions or further clarification requests related to these updates, please email irecsupport@icx-international.com.
Thank You for Your Engagement
The I-TRACK Foundation extends its sincere gratitude and appreciation to all partners, Market Players, and associated actors that have contributed to the resounding success of the I-REC(E) market in India.