NEW DELHI: India is finalising contours of green markets for short-term trade of renewable energy, moving away from the present preference for setting up such projects on the basis of long-term tie-ups.

Experts said the green markets will give an option to renewable energy companies to sell their power, particularly in context of recent examples of contract reneging by state distribution companies.

They will also encourage renewable developers at a time when spot power prices on exchange are higher than the tariff as low as ₹2.34 per unit discovered through competitive bidding, Amit Kumar, partner-clean energy at PwC said. On the other hand, distribution companies can fulfil their renewable purchase obligations (RPO) from sources other than renewable energy certificates, he said.

Under amendments to the Electricity Act, the government proposes to notify a National Renewable Energy Policy and introduce penalties for shortfall in meeting RPO target.

The Central Electricity Regulatory Commission (CERC) has concluded hearings based on petitions of Indian Energy Exchange and Power Exchange of India seeking permission for trading daily and weekly contracts on green markets. Sources said the government and CERC are working towards bringing about separate platform for trading of renewable generation like wind and solar energy.

CERC had on March 12 concluded hearings and reserved order in the matter. The commission had in December 2016 rejected a similar petition by IEX, citing bad time.

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