India publishes draft Renewable Energy Act for suggestions from stakeholders

Ministry of New and Renewable Energy

India’s ministry of new and renewable energy (MNRE) has published a draft Renewable Energy Act. It now awaits suggestions from the public before feasible amendments and finalization.

Last October, MNRE had constituted an expert committee to draft the Renewable Energy Act. The committee decided to constitute a sub-group to draw suggestions from the public and produce a draft based on the inputs received.

The purpose of the Act is to promote the production of energy using renewable energy sources. It stipulates such production in accordance with climate, environment and macroeconomic considerations to reduce dependence on fossil fuels, ensure security of supply and reduce emissions of CO2 and other greenhouse gases.

This Act shall, in particular, contribute to increasing the proportion of energy produced using renewable energy sources.

According to a report, the Act broadly proposes provisions for institutional structure, supportive ecosystem, economic and financial framework, constitution and operation of national and state level funds to support achieving of its objectives, and renewable energy applications including distributed and grid connected renewable electricity.

Industry, developers, research and development institutions, policy research institutions, think-tanks, academia, electrical utilities and other stakeholders can submit their suggestions online by July 27, 2015.

Meanwhile, Centre for Science and Environment (CSE) has welcomed the draft Act and plans to share a few suggestions with MNRE.

“The draft Act emphasizes that RE should be mainstreamed by offering financial incentives and infrastructural support to manufacturers and developers so as to bring RE on the same level playing field as fossil fuels,” Chandra Bhushan, the deputy director general of CSE said in a release.


Positives in the draft Act

# Special emphasis on distributed renewable energy generation and energy access

# Promotion of decentralised (small-scale units) and stand-alone renewable energy applications (such as heating and cooling) in rural and urban areas

# Issues with integration of large-scale distributed generation including grid connectivity and technical and safety measures addressed

# Process will be devised for informed local consent for projects in writing

# Plans to devise structure for revenue/benefit-sharing with the community

# Plans to identify and develop RE investment zones to meet goals mentioned in National RE Development Plan

# Explains components that can be included in renewable purchase obligation (RPO)

# Penalty has been announced for non-compliance

# Best practices for streamlining project permits, clearances and institutional structure will be adopted


Points of contention

# Lack of clarity on chargeability of distributed generation of power

# Wording “reasonable tariff” could give unfair advantage to developers

# ‘RE investment zones’ not defined clearly. It is not clear whether these are physical zones, special economic zones or areas demarcated for project development.

# Few indicators to ensure environmental protection

# No explicit terms on treatment of ecologically sensitive areas or how Environment Impact Assessment (EIA) will be done for RE projects


Ajith Kumar S