Co-generation power plants do not have to meet ‘renewable purchase obligations’ (RPO), even if they generate electricity using fossil fuels; also, the entities mandated to meet RPO can buy power from these co-generation plants to discharge their obligations, according to the Appellate Tribunal for Electricity.
This means big industries that are ‘obligated entities’ and have to meet the prescribed renewable purchase obligations, could just put up a captive co-generation plant and buy electricity from that plant, to meet their obligations.
The implication of this is that a large chunk of potential buyers of green power (or renewable energy certificates, instead) are effectively out of the net. For instance, if an aluminium smelter has a co-gen plant, it can buy power from that plant even if it is coal-fired, and yet be considered to have met the ‘renewable purchase obligation.’
In its recent decisions on appeals filed by Emami Paper Mills and Vedanta Aluminium, APTEL did not go into the fundamental issue —whether a plant that produces electricity using fossil fuels produces ‘green’ power or not. Instead, it went by the legal definition of who are all counted as ‘obligated entities’.
“The definition nowhere provides that a co-generation plant having fossil fuel as its basis would be a conventional captive generating plant, and that therefore, it is an ‘obligated entity’,” Justice Karpaga Vinayakam, Chairperson, APTEL, said in his judgment on a petition filed by Emami Papers.