CERC proposes amendments to REC framework

The Central Electricity Regulatory Commission (CERC) has released draft amendments to the Renewable Energy Certificate (REC) regulations, marking the first revision since the rules were introduced in December 2022. 

The draft, published on 22 September 2025, seeks to address stakeholder concerns, update the multiplier system, and introduce provisions for Virtual Power Purchase Agreements (VPPAs).

The Commission has invited public comments on the draft until 23 October 2025.  

Clarifications on eligibility and DISCOM timelines

The amendments propose clarity for renewable energy plants with self-consumption that do not qualify as Captive Generating Plants. These plants will now be eligible for RECs, which broadens participation in the mechanism.

For distribution companies (DISCOMs), the existing three-month timeline to apply for certificates against excess renewable energy procurement has been retained. The Commission noted that DISCOMs have faced challenges with this timeline under current state-level energy accounting systems, but emphasised the need for alignment with regulatory requirements.

Revised certificate multiplier methodology

The amendment introduces a revised approach to determine multipliers for projects commissioned after the rules come into effect. The new system assigns weightages to three factors: Tariff Range (40 per cent), Technology Maturity (30 per cent), and Capacity Credit or Peak Support (30 per cent).

As per the draft, offshore wind receives the highest multiplier at 3.5, while pumped hydro and battery energy storage systems are set at 3.0. Large hydro and biomass projects are placed at 2.5, with solar and onshore wind maintained at 1.0. Each assigned multiplier will remain valid for 15 years from the commissioning date.

Framework for VPPA

The draft regulations introduce a new provision for RECs generated under Virtual Power Purchase Agreements. Certificates from such projects will be directly transferred to the consumer or designated party to meet Renewable Purchase Obligations or Renewable Consumption Obligations. These certificates cannot be traded but can be carried forward if not immediately used for compliance.

According to the explanatory memorandum, the changes are intended to expand participation in the REC framework, provide incentives for emerging technologies, and streamline compliance.

Access the full document here.

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