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Abstract: Well designed Renewable Energy (RE) policies and their effective regulation is the key to promote RE generation in the world. Renewable Energy Certificate (REC) mechanism is a market-based policy instrument which facilitates Renewable (Energy) Purchase Obligations (RPOs) in order to increase RE generation in a country. The recently conceived and implemented REC mechanism in India attempts to involve various stakeholders in an economically efficient manner and has been effective in its first year of operation. The paper commences with the background and the genesis of REC mechanism in India. It characterises the REC trading mechanism and analyses the performance of the REC market for the FY 2011–12. Comparing the financial viability for sale of RE by project developers in certain key states, the paper shows that REC mechanism is more profitable than entering into a Power Purchase Agreement (PPA) for sale of RE at Preferential Tariff (Feed-in-Tariffs). Thus, the REC market which has attained a size of 2.3 billion INR in its first year of existence is forecasted to grow manifold in the future and the paper attempts to forecast the market size in near term. Further analysis of the REC market reveals that although there are inherent advantages of the REC mechanism over other methods of promoting growth of RE, the market is currently subject to various distortions and the paper suggests few steps for correcting these distortions by appropriate market re-design. The paper concludes that the REC market mechanism has gained momentum and can effectively promote RE generation in an economically efficient manner, with benefits to all stakeholders, provided it is strictly implemented and continuous corrections are given in the right direction by the market regulator. [Copyright &y& Elsevier]

Abstract: An innovative energy model is explored for techno-economic feasibility evaluation, taking into consideration the geographical advantages, government policies, regional incentives and energy certificates. In India, two energy certification schemes have been started, namely, the Renewable Energy Certification (REC) mechanism, successfully implemented in India during 2011, and the Perform, Achieve and Trade (PAT) for the Enhanced Energy Efficiency Programme in 2012. This paper reviews the state of the art in designing an energy model at a specific location, with the consideration of solar, wind and ground sources for renewable energy and fossil fuel, to gain optimum performances in energy certificate scenario. The key design issues about boundary and target settings for REC and PAT energy certificates are discussed to review the financial performance of the schemes taking into considerations energy generators, designated consumers and traders in the market. Due to major impact of micro-medium and small industries (MSME) on Indian economy, this paper discusses the possibilities of inclusion of MSME in PAT scheme. One more addition in PAT scheme, with respect to large unit with marginal available fund for technology upgradation/financially sick unit, invites the creation of consolidated fund, which will support technology absorption and role of state Government policies for funding this mechanism. The energy model provides the estimation and prediction of hybrid power generation in regard to the parameters of resource potential, technology, efficiency and consumption pattern. The monitoring, statistical and prediction model with inbuilt mechanism for REC and PAT incentives is explored. [Copyright &y& Elsevier]