Govt considers Renewable Generation Obligation for TPPs set up after April 1, 2024

The Ministry of Power is considering introducing Renewable Generation Obligation (RGO) for thermal power plants (TPPs) set up after April 1, 2024
Thermal power plants (A representative image)
Thermal power plants (A representative image)

New Delhi: The Ministry of Power is considering introducing Renewable Generation Obligation (RGO) for thermal power plants (TPPs) set up after April 1, 2024, an official proposal floated by the Ministry showed. "To enhance the generation and utilisation of Renewable Energy (RE) in the country, Ministry of Power is considering notification of Renewable Generation Obligation in accordance with Tariff Policy," said a proposal document dated November 7. The government is considering asking TPPs to do so with a view to enable bundling of thermal power with renewable energy for sale to consumers.

"Recognising the need for decarbonisation of the economy, India has set a target of net zero by 2070 alongside intermittent targets by 2030. In the recently updated Nationally Determined Contribution (NDC), India has committed to achieving 500 percent of cumulative electric power installed capacity from non-fossil fuel-based energy sources by 2030," said the document. The Ministry of Power has also sought comments from all stakeholders on the policy within 21 days.

TPPs might be required to set up/procure RE equal to 25% of thermal capacity

In the proposal, the ministry has suggested holding coal and lignite-based power plants set up after April 1, 2024 responsible for either setting up or procuring renewable energy equivalent to 25 percent of their thermal capacity. "The capacity of renewable energy to be established/ procured/ supplied by new coal/ lignite based thermal generating station to be minimum twenty five percent of the capacity of thermal generating station being established," the ministry has said.

What is Renewable Generation Obligation?

In order to create an additional avenue for promotion and generation of RE, the Tariff Policy notified on January 28, 2016, had mooted the idea of Renewable Generation Obligation. Clause 6.4.5 of the policy states, "In order to promote renewable energy sources, any generating company proposing to establish a coal/lignite based thermal generation station after a specified date shall be required to establish such renewable energy generating capacity or procure and supply renewable energy equivalent to such capacity, as may be prescribed by the Central Government from time to time after due consultation with stakeholders. The renewable energy produced by each generator may be bundled with its thermal generation for the purpose of sale. In case an obligated entity procures this renewable power, then the SERCs will consider the obligated entity to have met the Renewable Purchase Obligation (RPO) to extent of power bought from such renewable energy generation stations."

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