Dec. 31 (Bloomberg) — Demand for Indian renewable-energy
credits more than doubled in December from the previous month
with volumes rising to the second-highest level this year.
Bids from companies seeking to buy credits climbed 106
percent from the November trading session, while sell bids
gained 18 percent, according to data from REConnect Energy
Solutions Pvt., an Indore-based trader. The credits sold for
1,500 rupees ($27) each, the floor price set by the regulator.
“One of the reasons for the increase could be that India’s
Central Electricity Regulator is deciding on increasing the
validity of renewable-energy credits for more than one year,”
said Bharat Bhushan, a New Delhi-based analyst with Bloomberg
New Energy Finance. “This could lead to a rise in prices in the
future as sellers may tend to hold on to credits.
In India, significant buying happens in the second half of
the financial year as companies try to meet their fiscal targets.
That could be another reason for the increase, said Bhushan.
The government requires companies including state-run power
distributors, Coal India Ltd., Oil & Natural Gas Corp., Tata
Power Co. and other large power consumers to buy as much as 10
percent of their electricity every year from renewable sources.
Those unable to secure enough clean power locally can meet their
target by purchasing credits sold by wind and solar farms,
hydropower and biomass plants from the country’s two power
exchanges.
Each credit represents one megawatt-hour of clean
electricity fed into the grid.
To contact the reporter on this story:
Archana Chaudhary in New Delhi at
achaudhary2@bloomberg.net
To contact the editor responsible for this story:
Reed Landberg at
landberg@bloomberg.net
