Echanda Urja Private Limited (EUPL) has withdrawn its petition before the regulatory authorities after successfully resolving a dispute regarding the sale of Renewable Energy Certificates (RECs). The matter, which had been ongoing for several months, concluded a hearing on September 7, 2023.
EUPL, a prominent player in the renewable energy industry, had filed a petition seeking direction from the National Load Despatch Centre (NLDC) to allow the company to sell its unsold RECs, which were issued for the generation of power up to November 2022.
The crux of the issue stemmed from changes in regulations. On May 28, 2022, the regulatory authority introduced the REC Regulations, 2022, which came into effect on December 5, 2022. These new regulations included provisions that affected the sale of RECs issued to Captive Generating Plants (CGPs). Under the new rules, RECs issued to CGPs for self-consumption were not eligible for sale. However, Regulation 19(2)(b) of these regulations stipulated that RECs issued under the previous REC Regulations, 2010, and not redeemed before the enforcement of the REC Regulations, 2022, would remain valid until redeemed and eligible for exchange under the new regulations.
EUPL, operating a 100.5 MW Wind Power Project in Tamil Nadu, found itself unable to sell its unsold RECs during the period when the new regulations were in force. This situation resulted in severe financial constraints for the company, leading EUPL to approach the Hon’ble High Court of Delhi to seek relief.
In a significant turn of events, the Hon’ble High Court of Delhi, in an order dated May 11, 2023, vacated the stay on trading of RECs issued before October 31, 2022, thereby allowing the sale of these certificates. Following this court order, EUPL approached NLDC intending to sell its unsold RECs, but NLDC responded by citing the REC Regulations, 2022, which EUPL believed prevented them from selling their RECs.
During a hearing on May 30, 2023, EUPL informed the regulatory authorities that NLDC had reconsidered its position in line with the Commission’s direction, allowing EUPL to sell its unsold RECs issued up to November 2022. Consequently, the petition filed by EUPL was rendered moot.
In light of this development, EUPL’s counsel sought permission to withdraw the petition, and the regulatory authorities granted this request. The matter was formally disposed of as withdrawn, bringing an end to the legal dispute.
This resolution marks a positive outcome for Echanda Urja Private Limited and underscores the importance of clear regulatory frameworks in the renewable energy sector. It also highlights the significance of legal recourse in resolving disputes within the industry, ultimately promoting stability and growth in the renewable energy market.
Please read the document for more.