Ministry of Power Proposes Cut in Renewable Generation Obligation for Coal and Lignite-Based Power Plants
The Ministry of Power has unveiled a draft notification outlining plans to drastically reduce the Renewable Generation Obligation (RGO) for upcoming coal and lignite-based power plants in India.
October 11, 2023. By News Bureau
The proposed mandate seeks to lower the RGO from the current 40% to a range of 6-10%, contingent on the commissioning dates of these power plants.
The latest draft notification, issued by the Ministry of Power on October 6, represents a concerted effort to align with the Energy Conservation Act of 2001, with the ultimate goal of curbing fossil fuel consumption within the nation.
Under the proposed amendments, power plants commencing operations by March 31, 2023, will be subject to an RGO of 6 percent, while those commissioned between April 1, 2023, and March 31, 2025, will adhere to a 10 percent mandate. Subsequent RGO percentages post-April 1, 2025, will be determined based on the commercial operation dates of the power plants.
The draft emphasises the pivotal role that coal and lignite-based stations play in reducing fossil fuel reliance by incorporating electricity from renewable sources.
These revised RGO percentages are presented as a strategic move to promote a larger share of non-fossil fuel-derived electricity within the energy mix.
Notably, the draft gives designated power producers the flexibility to choose between setting up renewable energy generation facilities or procuring the required renewable energy. Moreover, companies with multiple coal or lignite-based plants can aggregate their RGO requirements to streamline compliance.
While the ministry warns of penalties for non-compliance, specific penalty structures are still under deliberation.
This draft notification is expected to supersede the previous notification dated February 27, 2023, regarding the Renewable Generation Obligation, reflecting a significant shift in India's approach to energy generation and environmental sustainability.
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