No Increase in RPO of Captive Projects if Additional Capacity Not Added: Ministry of Power

The Ministry for Power has set solar RPO for the financial year 2019-2020 at 7.25 percent

February 22, 2019


The Ministry of Power has passed an order stating that the renewable purchase obligations (RPO) of captive power projects should be fixed at the appropriate level in the year such projects are commissioned.

However, the order clarifies that if a company adds to the capacity of captive power projects, then additional RPO will be provided as obligated in the year of new capacity addition.

The order makes it clear that there will be no increase in RPO of captive power projects if additional fossil fuel capacity is not added.

The ministry was responding to a request made by various stakeholders regarding the capping of RPO for captive power projects. The Ministry of New and Renewable Energy was also consulted for its opinion.

Earlier, Mercom reported that the Ministry for Power had set solar RPO for the financial year 2019-2020 at 7.25 percent. The non-solar RPO for FY 2019-2020 has been set at 10.25 percent.

The solar RPO for FY 2020-2021 is 8.75 percent while non-solar RPO is 10.25 percent. This further increases to solar RPO of 10.50 percent in FY 2021-2022 and non-solar RPO of 10.50 percent in FY 2021-2022.

The RPO targets were increased to help increase the momentum of renewable energy installations, especially solar, across all the states in the country.

However, Mercom recently reported that as many as twenty-seven Indian states and union territories in the country had achieved less than 60 percent of their RPO.

In May 2018, the MNRE created a compliance cell for RPOs. The cell coordinates with states, the CERC, and state electricity regulatory commissions to ensure RPO compliance. The cell aims to work with these institutions to make monthly reports on RPO compliance. It will also take up non-compliance related issues with the appropriate authorities. The formation of this compliance cell is the culmination of efforts undertaken in 2017.