India’s Installed RE Capacity Exceeds 180 GW; Distribution Licensees to Adhere to New Consumption Norms from April 1, 2024

In a bid to bolster India’s renewable energy capacity, the Ministry of Power has mandated distribution licensees to adhere to a specified percentage of renewable energy consumption. This move, in accordance with Section 14 (x) of the Energy Conservation Act, 2001, aims to accelerate the integration of clean energy sources into the nation’s electricity grid.

The Union Minister for New & Renewable Energy and Power recently disclosed significant developments regarding the installation of renewable energy capacity across the country. This announcement aligns with Section 86 (1) (e) of the Act, which empowers State Electricity Regulatory Commissions (SERCs) to establish a renewable purchase obligation (RPO) for electricity distribution utilities (DISCOMs).

Under the purview of Section 14 (x) of the Energy Conservation Act, 2001, as amended by the Energy Conservation (Amendment) Act, 2022, the Ministry of Power has been granted authority to specify the minimum share of consumption of non-fossil resources by designated consumers. Notably, distribution licensees have been designated as consumers under this act.

The Ministry of Power, through a notification dated 20.10.2023, has delineated the minimum share of renewable energy consumption that distribution licensees must uphold as a percentage of total energy consumption. This directive aims to diversify energy sources and reduce dependence on fossil fuels, fostering sustainability and environmental preservation.

The issuance of guidelines on Renewable Purchase Obligation (RPO) trajectories, coupled with the specification of renewable energy consumption requirements for distribution licensees, underscores the government’s commitment to fostering a robust renewable energy ecosystem in India.

The above notification will come into force on 1^st April 2024 and therefore the distribution licensees will have to comply with the specified renewable energy consumption norms w.e.f. FY 2024-25.

All schemes being implemented by the Ministry of New and Renewable Energy aim to promote the utilization of renewable energy sources in all regions of the country, including the tribal areas.

The source and state-wise details of the renewable energy capacity installed in the country as on 31.12.2023 are given below.

The details of provisions in place for encouraging the installation of Renewable Energy Plants are as follows:

1. Permitting Foreign Direct Investment (FDI) up to 100 percent under the automatic route.
2. Waiver of Inter State Transmission System (ISTS) charges for inter-state sale of solar and wind power for projects to be commissioned by 30th June 2025.
3. As per MoEFCC’s provisions of the EIA Notification 2006 Solar PV Power Projects, Wind Power Projects are exempted from Environment Impact Assessment (EIA).
4. Accelerated Depreciation at the rate of 40% is available on Solar and Wind Power Projects.
5. Central pollution control board has included Solar Power generation through solar photovoltaic cell plants of all capacities, Wind Power Plants of all capacities and hydel Power Plants upto and including capacity of 25 MW under white category.