THERMAL POWER generation companies will now be able to supply renewable energy under existing Power Purchase Agreements (PPAs) with distribution companies (discoms) under the revised guidelines issued by the Power and New and Renewable Energy Ministries on Tuesday.
The revised guidelines allow thermal generation companies “to set up renewable energy generation capacity either by themselves (or) through developers by open bids,” and supply power to consumers under existing PPAs, according to the government release.
Under the revised guidelines, any savings to thermal power plants from lower cost of power generation through renewable energy would be shared with procurers, such as distribution companies on a 50:50 basis.
The move is aimed at boosting the installed capacity of renewable energy to 500 GW (Giga Watts) by 2030 in line with commitments made by Prime Minister Narendra Modi at the COP26 climate change conference earlier this month.
In line with commitments made by Prime Minister Narendra Modi at the COP26 climate change conference earlier this month, the move is aimed at boosting the installed capacity of renewable energy to 500 GW (Giga Watts) by 2030.
“This will enable the replacement of fossil fuel based energy by renewable energy under the existing PPAs,” the release said, noting that the discoms would be allowed to count renewable energy purchased under the scheme towards their Renewable Purchase Obligation (RPO).
Under the long-term growth trajectory of RPOs, states have been asked to increase the proportion of power procured from renewable sources to 21.2 per cent of their total procurement in FY2022.
This is a very significant step towards achieving the goal of 500 GW of non-fossil fuel capacity by 2030, the Ministry said, adding that the government was set to issue orders on additional steps for achieving the target soon.