India proposes renewable energy certificate scheme

The Indian government is reportedly working on plans for a new renewable energy certificate (REC) scheme designed to drive investment in low-carbon energy projects.

According to local reports, the country's power regulator last week announced new rules that would allow generators of renewable energy to obtain RECs that could be bought by companies and government bodies to count towards renewable energy targets.

The scheme, which appears to be loosely modelled on the system of RECs in the US, would provide renewable energy developers with an additional revenue stream while giving companies the ability to bolster their green credentials by demonstrating that they have purchased renewable energy.

A central agency will be set up to issue and administer RECs, while renewable energy generators will be allowed to sell the electricity at an above-market tariff set by local power regulators, or sell the electricity and associated REC separately.

"This concept seeks to address the mismatch between availability of renewable energy sources and the requirement of the obligated entities to meet their renewable purchase obligation," the regulator said in a statement.

The scheme is the latest in a series of initiatives designed to increase investment in India's renewable energy capacity and deliver on a government target to double renewable energy capacity to 25GW within four years.

The country launched a feed-in tariff scheme for renewable energy last year and is also working on a high-profile project, dubbed the Solar Mission, to deliver about 20GW of solar energy capacity in the next decade.