NEW DELHI: In what may be a significant step to turn states aggressively to clean energy sources, the Union ministry of new and renewable energy has written to the power ministry suggesting it to 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, states will have to meet 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 the state-owned ailing distribution companies financial viable.
The move will help the government not only to achieve its clean energy target under the National Action Plan on Climate Change but also to 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 the 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.
"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 convenor of the Climate Parliament (forum of legislatures working worldwide to combat climate change) - referring to a letter written to him by the Union 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 the past four years.
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 decision, along with couple of other moves, will push the country go green way under a well-defined path, considering huge solar and wind power potential. Except for renewable power-rich Gujarat and Rajasthan, all other states had failed to comply with their RPO targets last year.
Abdullah in his letter to Jaiswal said that his ministry, in close coordination with the ministry of power, has been making concerted efforts to put in place a "robust RPO compliance regime". His ministry has recently requested all the states to ensure RPO compliance and also monitor the same, he added.
