CERC’s Renewable Energy Tariff Regulations to boost sector

In line with the objective to attract new investments in the power sector, and specifically, to promote renewable energy, the CERC, which regulates inter-state power sector, announced new tariff regulations for grid-connected renewable energy power projects. These regulations assure developers of a higher return on the equity invested and indirect incentives if the developer can contain capital and operational costs.
In India, only 8.7% of the total grid-connected power capacity is attributable to the renewable energy segment. Thus at an installed base of 13,242MW, this segment constitutes merely 21% of the potential 62,853MW from only small hydro and wind power. The potential of solar, biomass and waste-based power projects is estimated to be a further 625,500MW, of which solar-based projects alone contribute 600,000MW. Thus, the solar segment alone has the potential to fuel India’s entire present electricity requirement.
We believe that the overriding philosophy of these new regulations is to promote power generation from renewable energy sources by giving a preferential/differential tariff to such projects. This, we believe, will go a long way to help achieve the target of 15% of total generation from renewable energy sources by 2020, a target set under the National Action Plan on Climate Change.

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