Reviving renewable energy certificates for balancing India’s energy transition

The global energy transition is gathering pace. Corporations around the globe are increasingly embracing renewables and ramping up efforts to reduce their carbon emissions. A global exchange for high-quality carbon credits is expected to go live by the end of 2021 in Singapore. More than 300 influential corporations, many of which operate in India, have already committed to 100 percent renewable electricity. Reliance Industries Ltd (RIL) chairman Mukesh Ambani also recently said that going green was now “a prerequisite” for business survival.

Still, India Inc. must do more to reduce its carbon footprint. But how? One option is using market-linked instruments like renewable energy certificates (RECs), which have been instrumental in deepening renewable energy (RE) penetration in overseas markets like the US, the UK, and Australia. RECs are sold on power exchanges and represent the green attributes of power. By purchasing them, entities with renewable purchase obligations (RPOs)—such as discoms—and voluntary buyers like corporates can meet RE targets without dealing with the uncertainty and transaction costs associated with actual green power procurement. Read More…

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