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Centre to get tough on states not meeting clean energy targets

NEW DELHI: The Centre may get tough on states which are not meeting the clean energy target. The Union ministry of new and renewable energy has written to the power ministry suggesting that it make it mandatory for states to fulfill their ‘Renewable Purchase Obligation’ (RPO) if they want to get central support for financial restructuring of their electricity distribution companies.

Once the power ministry agrees to the suggestion, the states will have to purchase a certain percentage of their energy requirement from clean (solar or wind) sources. If they fail to do that, they will not be able to get concessions from the Centre to make their ailing distribution companies financial viable.

The move will help the government not only achieve its clean energy target under the National Action Plan on Climate Change but also promote renewable energy generation in a big way. India is supposed to increase its share of renewable energy in the total energy mix to the extent of 15% by 2020.

The Electricity Act, 2003 mandates State Electricity Regulatory Commissions across the country to set targets – known as RPO – for distribution companies to purchase certain percentage of their total power need from renewable energy sources. However, most states – except renewable power-rich Gujarat and Rajasthan – miserably failed to comply with their targets last year.

“The ministry of new and renewable energy (MNRE) has written to the power ministry which will, hopefully, take a final call on this soon,” said Sanjay Jaiswal, Lok Sabha MP and convener of the Climate Parliament (forum of legislatures working worldwide to combat climate change), referring to a letter written to him by new and renewable energy minister Farooq Abdullah.

The move came in the backdrop of the recent decision of Maharashtra to crack the whip on electricity distribution firms to meet their obligation of buying renewable energy.

In a strongest ever move taken by any state or central authority since the launch of the RPO programme in 2010, the Maharashtra Electricity Regulatory Commission (MERC) had in July ordered over 90 entities – including government distribution companies and large private consumers – to attain their renewable purchase obligation targets by March 2014 or face stiff penalty.

It is believed that the MERC’s decision will go a long way in pushing Maharashtra achieve its target. Besides Maharashtra, Punjab is the only other state which has, so far, issued similar direction to its distribution companies and other large entities.

It is believed that the Maharashtra’s decision, along with couple of other moves like the one suggested by the MNRE to the power ministry, will push the country to take green route to its energy requirements under a well-defined path, considering huge solar and wind power potential.

Abdullah, in his letter to Jaiswal, said that his ministry, in close coordination with the power ministry, has been making concerted efforts to put in place a “robust RPO compliance regime”. His ministry has recently requested all the states to ensure such compliance and also monitor the same, he added.