**Tata Power’s Stance on International Renewable Energy Certificates**
Tata Power, one of India’s leading renewable energy producers, has opted not to engage in the country’s emerging International Renewable Energy Certificates (IRECs) market, which serves as an alternative to carbon credits, due to a lack of buyers. Praveer Sinha, the managing director and CEO of Tata Power, emphasized the need for policy intervention, including target-based incentives and disincentives, to invigorate the IREC and carbon credit markets in India. “Currently, there are no buyers,” Sinha stated. “India lacks regulations that incentivize or penalize major polluters for their emissions. Without such measures, the carbon credit market will struggle to gain traction.”
Although Tata Power has registered with the Green Certificate Company (GCC), based in Sheffield, UK, to issue IRECs, Sinha clarified that the company is not pursuing these certificates at this time. IRECs are certificates that signify the holder has consumed renewable energy, with each IREC representing one megawatt-hour (MWh) of electricity. These certificates are issued to renewable energy producers, who can sell them in a secondary market. Companies relying on non-renewable energy sources may buy IRECs to fulfill their sustainability goals.
In India, IRECs are traded on platforms like the Indian Energy Exchange (IEX) and Power Exchange India Ltd (PXIL), primarily purchased by power distribution companies, captive power plants, and large consumers to meet their Renewable Purchase Obligations (RPO), which are minimum renewable energy consumption targets set by the power ministry. However, IREC prices hit a record low in September due to oversupply, as reported by S&P Platts, which noted that the market is flooded with unconsumed certificates while demand remains significantly low.
Additionally, the Bureau of Energy Efficiency (BEE) is working on India’s Carbon Credit Trading Scheme (CCTS), which will establish a framework for both voluntary and compliance-based carbon trading in the country. A carbon credit represents the avoidance of one tonne of carbon dioxide emissions, allowing companies with high emissions to purchase credits to mitigate their environmental impact.
Tata Power, which has experienced profit growth for 21 consecutive quarters, is expected to maintain this upward trajectory in the mid-term as its investments across the power value chain begin to yield returns.
