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					</table><p>The Central Electricity Regulatory Commission (<a href="https://cercind.gov.in/" target="_blank" rel="noopener">CERC</a>) has determined the buyout price as an alternative compliance mechanism for electricity distribution licensees, open access consumers, and captive consumers to meet the renewable consumption obligation (RCO) requirements notified by the Ministry of Power.</p>
<p>The Commission determined the buyout price at ₹347 (~$3.83)/MWh for the financial years (FY) 2024–25 and 2025–26, based on the weighted-average renewable energy certificate (REC) price of ₹346.74 (~$3.82)/MWh for the period from December 2024 to November 2025.</p>
<p>From FY 2026–27 onwards, the buyout price will increase annually by 5%, reaching ₹364 (~$4.01)/MWh in FY 2026–27, ₹382 (~$4.21)/MWh in FY 2027–28, ₹401 (~$4.42)/MWh in FY 2028–29, and ₹421 (~$4.64)/MWh in FY 2029–30.</p>
<p>The determined prices will remain in force until FY 2029–30.</p>
<p><strong>Background</strong></p>
<p>The Ministry of Power specified minimum renewable energy consumption shares for designated consumers, including distribution licensees, open access consumers, and captive users.</p>
<p>The notification provided three mechanisms for compliance: direct consumption of renewable electricity, including through storage; purchase or self-generation of RECs; and payment of a buyout price determined by CERC.</p>
<p>Funds collected through the buyout mechanism will be credited to the Central Energy Conservation Fund, with 75% transferred to State Energy Conservation Funds to support renewable energy and storage deployment.</p>
<p>Following the notification, CERC initiated suo motu proceedings and issued a proposal on October 22, 2025, <a href="https://www.mercomindia.com/cerc-proposes-%E2%82%B9245-mwh-as-buyout-price-under-renewable-consumption-obligation" target="_blank" rel="noopener">suggesting</a> a buyout price of ₹245 (~$2.70)/MWh for FY 2024–25, calculated as 105% of the weighted average REC price of ₹232.84 (~$2.57)/MWh, and proposed linking future prices to 105% of the weighted average REC price of the respective financial year.</p>
<p>Some stakeholders argued that a buyout should be a last resort after exhausting renewable procurement and REC purchases, while others stated that the notification did not establish any hierarchy.</p>
<p>Stakeholders also sought clarity on reporting procedures, audit requirements, compliance timelines, GST applicability, and publication of REC price data.</p>
<p>Concerns were raised that a low buyout price could discourage renewable procurement and suppress REC prices, while a high buyout price could increase compliance costs and affect distribution company finances and retail tariffs.</p>
<p><strong>Price Determination</strong></p>
<p>The Commission clarified that it does not intend to create any hierarchy among the three compliance mechanisms, as the Ministry of Power notification provides them as alternative options, and CERC’s mandate is limited to determining the buyout price.</p>
<p>It also stated that procedural aspects, enforcement mechanisms, and fund utilization are outside the scope of the present order.</p>
<p>To determine the buyout price, the Commission adopted a market-linked approach and considered weighted-average REC prices from the Indian Energy Exchange, Power Exchange India, and Hindustan Power Exchange, as well as bilateral trades conducted through traders.</p>
<p>Based on the weighted-average REC price of ₹346.74 (~$3.82)/MWh for the latest 12-month period from December 2024 to November 2025, the Commission determined the buyout price at ₹347 (~$3.83)/MWh for FY 2024–25 and FY 2025–26.</p>
<p>It decided to apply a fixed annual escalation of 5% from FY 2026–27 to provide regulatory certainty and predictability for compliance planning.</p>
<p>Subscribe to Mercom’s real-time <a href="https://mercomindia.com/product/mercoms-renewable-energy-regulatory-updates/" target="_blank" rel="noopener">Regulatory Updates </a>to ensure you don’t miss any critical updates from the renewable industry.</p>


CERC Sets Renewable Consumption Obligation Buyout Price at ₹347/MWh


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					</table><p><a href="https://www.mercomindia.com/cerc-proposes-%E2%82%B9245-mwh-as-buyout-price-under-renewable-consumption-obligation?preview_id=85880&amp;preview_nonce=2c8b871e81&amp;post_format=standard&amp;_thumbnail_id=82121&amp;preview=true" target="_blank" rel="noopener">The Central Electricity Regulatory Commission (CERC) proposed that designated entities, including electricity distribution licensees, open access consumers, and captive</a> consumers, can fulfill their renewable consumption obligation (RCO) by paying the buyout price specified. The buyout price for FY25 is ₹245 (~$2.79)/MWh.</p>
<p><a href="https://www.mercomindia.com/grid-india-proposes-transmission-margin-for-full-t-gna-capacity-utilization?preview_id=85714&amp;preview_nonce=33bddd82ac&amp;post_format=standard&amp;_thumbnail_id=61703&amp;preview=true" target="_blank" rel="noopener">The Grid Controller of India (Grid-India) has proposed changes to the CERC’s draft procedure for the grant of temporary general network access (T-GNA) to the interstate</a> transmission system. Grid India has proposed to mandate an adequate margin in the transmission system to enable the scheduling of power projects up to their full T-GNA capacity.</p>
<p><a href="https://www.mercomindia.com/cerc-lays-down-interim-measures-for-load-despatch-centers-to-improve-grid-stability?preview_id=85733&amp;preview_nonce=56517ee7e3&amp;post_format=standard&amp;_thumbnail_id=58598&amp;preview=true" target="_blank" rel="noopener">Considering the growing instability of the grid due to seasonal jumps in power demand, CERC has suggested a few interim measures for regional load dispatch centers, state</a> load dispatch centers (SLDC), and national load dispatch centers (NLDC). Taking note of the unpreparedness and irregularity in the operation of NLDCs and SLDCs, the Commission urged the states to maintain their own adequate power reserves to meet peak-hour demand.</p>
<p><a href="https://www.mercomindia.com/government-proposes-cost-reflective-power-tariffs-in-draft-amendment-bill?preview_id=85431&amp;preview_nonce=b8cc4ec7b5&amp;post_format=standard&amp;_thumbnail_id=84124&amp;preview=true" target="_blank" rel="noopener">To make distribution companies more financially viable, the Ministry of Power has proposed an amendment to the Electricity Act, 2003, mandating the electricity</a> regulators to issue cost-reflective power tariffs. The Power Ministry also proposes to amend the Electricity Act to empower state electricity regulatory commissions to file for tariff revisions suo motu.</p>
<p><a href="https://www.mercomindia.com/cerc-notifies-amendment-to-connectivity-and-gna-regulations-2025?preview_id=85137&amp;preview_nonce=03d0b184e1&amp;post_format=standard&amp;_thumbnail_id=80834&amp;preview=true" target="_blank" rel="noopener">CERC has notified the Connectivity and General Network Access to the Interstate Transmission System (Third Amendment) Regulations, 2025. The new rules modify</a> several aspects of the Principal Regulations of 2022, introducing expanded definitions, revised procedures for application withdrawals, restructuring of bank guarantee requirements, rules for connectivity to interstate transmission system substations, and detailed compliance obligations for renewable generating stations and energy storage systems.</p>
<p><a href="https://www.mercomindia.com/dgft-mandates-registration-end-use-declaration-of-solar-cells-and-modules?preview_id=85468&amp;preview_nonce=6ed36f862f&amp;post_format=standard&amp;_thumbnail_id=76880&amp;preview=true" target="_blank" rel="noopener">Importers of solar and wind energy components must register the items with the Renewable Energy Equipment Import Monitoring System before bringing them into the</a> country and declare the intended end-use of the imported products. Under these amendments, solar component importers of toughened (tempered) safety glass and photosensitive semiconductor devices, including photovoltaic cells, whether or not assembled into modules or made into panels, must register these items.</p>
<p><a href="https://www.mercomindia.com/government-allows-4-hour-1-cycle-bess-operation?preview_id=85072&amp;preview_nonce=f0dd0dabac&amp;post_format=standard&amp;_thumbnail_id=81400&amp;preview=true" target="_blank" rel="noopener">The Ministry of Power has allowed states to implement standalone battery energy storage system (BESS) projects under viability gap funding, supported by the</a> Power System Development Fund, in both two-hour and four-hour configurations. The original guidelines specified that the BESS capacity should preferably have a two-hour discharge duration and average one and a half cycles per 24-hour period.</p>
<p><a href="https://www.mercomindia.com/mnre-issues-standard-operating-procedure-for-almm-wind-turbine-enlistment?preview_id=86166&amp;preview_nonce=8b03c6a9f9&amp;post_format=standard&amp;_thumbnail_id=84291&amp;preview=true" target="_blank" rel="noopener">The Ministry of New and Renewable Energy issued standard operating procedures for the Approved List of Models and Manufacturers Wind (ALMM-Wind) and the Approved</a> List of Models and Manufacturers Wind Turbine Components. For a wind turbine model to qualify for ALMM-Wind, it must possess a valid type certificate issued by an accredited certification body.</p>
<p><a href="https://www.mercomindia.com/uttar-pradesh-new-framework-captive-renewable-projects?preview_id=86066&amp;preview_nonce=ea7c509532&amp;post_format=standard&amp;_thumbnail_id=85840&amp;preview=true" target="_blank" rel="noopener">The Uttar Pradesh Electricity Regulatory Commission notified the Captive and Renewable Energy Generating Plants Regulations, 2024, setting a comprehensive</a> framework for renewable and captive generation in the state from April 1, 2024, to March 31, 2029. The regulations apply to renewable and captive renewable energy projects, including cogeneration-based systems. As per the regulations, the Commission has limited the number of wheeling and banking agreements to two for the project’s lifetime to ensure the system’s proper management.</p>
<p><a href="https://www.mercomindia.com/global-solar-sector-attracts-17-3-billion-corporate-funding-in-9m-2025-down-22-yoy?preview_id=85926&amp;preview_nonce=4c934b905d&amp;post_format=standard&amp;_thumbnail_id=62498&amp;preview=true" target="_blank" rel="noopener">Total corporate funding, including venture capital funding, public market, and debt financing, for the solar sector globally, stood at $17.3 billion in the first nine months</a> (9M) of 2025, 22% lower than the $22.3 billion raised in 9M 2024. However, financing picked up in the third quarter (Q3) of 2025, totaling $6.5 billion across 49 deals —a 38% year-over-year increase from $4.7 billion across 29 deals in Q3 2024.</p>
<p><a href="https://www.mercomindia.com/indias-utility-scale-solar-tender-and-auction-activity-surges-in-q3-2025?preview_id=85829&amp;preview_nonce=e01ffe6312&amp;post_format=standard&amp;_thumbnail_id=82617&amp;preview=true" target="_blank" rel="noopener">A total of 16.5 GW of utility-scale solar tenders were issued by various agencies in the Q3 of the calendar year 2025, representing a 137.6% increase from 6.9 GW in the</a> previous quarter and a decrease of 17.8 % from 20 GW in the same quarter last year, according to Mercom India research.</p>
<p><a href="https://www.mercomindia.com/mnre-notifies-cfa-release-rules-for-utility-led-pm-surya-ghar-projects?preview_id=85740&amp;preview_nonce=436aa7e99e&amp;post_format=standard&amp;_thumbnail_id=84509&amp;preview=true" target="_blank" rel="noopener">The Ministry of New and Renewable Energy amended the operational guidelines for implementing the utility-led aggregation model under the PM Surya Ghar: Muft Bijli</a> Yojana to release central financial assistance (CFA) in a single tranche. The CFA will be released after the physical installation, inspection, and commissioning of the rooftop solar installation.</p>
<p><a href="https://www.mercomindia.com/rajasthan-electricity-regulator-allows-virtual-and-group-net-metering?preview_id=85524&amp;preview_nonce=e358a316f5&amp;post_format=standard&amp;_thumbnail_id=83784&amp;preview=true" target="_blank" rel="noopener">The Rajasthan Electricity Regulatory Commission notified the third amendment to its Grid-Interactive Distributed Renewable Energy Generating Systems Regulations,</a> opening up virtual and group net metering across consumer categories, codifying charge waivers, and adding battery storage incentives. According to the amendment, under virtual or group net metering, an eligible consumer may install a distributed renewable energy project of more than 1 kW and up to 1 MW.</p>
<p><a href="https://www.mercomindia.com/india-added-48-4-mwh-of-energy-storage-capacity-in-1h-2025?preview_id=85182&amp;preview_nonce=e0fcc938e1&amp;post_format=standard&amp;_thumbnail_id=82402&amp;preview=true" target="_blank" rel="noopener">India added 48.4 MWh of energy storage capacity in the first half (1H) of 2025, a 74% decline from 186 MWh added in the same period last year, according to the newly</a> released India’s Energy Storage Landscape 1H 2025 Report by Mercom India Research. India’s cumulative installed energy storage capacity reached 490 MWh by the end of June 2025.</p>
<p><a href="https://mercomindia.com/electric-vehicle-sales-clock-12-5-yoy-growth-in-q3-2025" target="_blank" rel="noopener">Electric vehicle (EV) sales in India reached 560,637 units in Q3 for 8% of the overall automobile sales, which totaled 5,796,216 units in Q3, according to data released by</a> the Ministry of Road Transport and Highways through its Vahan Dashboard. India now has over 7.02 million registered EVs.</p>
<p><a href="https://www.mercomindia.com/government-notifies-guidelines-for-charging-stations-under-pm-e-drive?preview_id=85092&amp;preview_nonce=0d1fc6a3cc&amp;post_format=standard&amp;_thumbnail_id=85093&amp;preview=true" target="_blank" rel="noopener">The Ministry of Heavy Industries has notified operational guidelines for deploying EV public charging stations under the PM Electric Drive Revolution in</a> the Innovative Vehicle Enhancement program. Subsidies will be provided for EV public charging stations and battery swapping stations or battery charging stations.</p>


Month in a Minute: Top Headlines from the Indian Renewable Sector in October 2025


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					</table><p>The Central Electricity Regulatory Commission (<a href="https://cercind.gov.in/" target="_blank" rel="noopener">CERC</a>) has proposed that designated entities, including electricity distribution licensees, open access consumers, and captive consumers, can fulfill their renewable consumption obligation (RCO) through payment of the buyout price specified by it.</p>
<p>The buyout price for the financial year (FY) 2024-25 will be set at ₹245 (~$2.79)/MWh, which is about 5% above the weighted average REC price for the year computed from transactions on power exchanges and via trading licensees.</p>
<p>The buyout price for a financial year will be 105% of the weighted average REC price. By April 30 of every financial year up to FY 2029-30, the National Load Despatch Centre will publish the weighted average price of REC and the buyout price for the previous financial year.</p>
<p>Stakeholders can submit their comments and suggestions by November 21, 2025.</p>
<p>The buyout price is the newly proposed means by the CERC to meet RCO, along with the existing method of consuming renewable electricity directly or through an energy storage system and purchasing or self-generating renewable energy certificates (REC).</p>
<p>The buyout price will reflect the green attribute cost and electricity component cost separately in an unbundled form. The obligated entity seeking to adopt a buyout price would pay this price, which would represent a green attribute equivalent to the REC price. In addition, such an obligated entity will have to meet its energy requirements by purchasing the electricity separately.</p>
<p>The sum received through the buyout mechanism will be credited to the Central Energy Conservation Fund under a separate head, from which 75% of the amount will be transferred to the respective state energy conservation funds.</p>
<p>These sums will be utilized to support the development of specified renewable energy sources and storage capacities, thereby increasing the share of non-fossil fuel energy in the overall energy mix. The government will specify the mechanism for utilizing these sums to support the development of such non-fossil fuel capacities.</p>
<p>CERC has noted that the two existing options clearly lead to investment and, in turn, the establishment of renewable energy capacities, making them the preferred options for RCO compliance. It is only when either of these two options is exhausted that the designated consumers should lean on buyout price payment for RCO compliance.</p>
<p>CERC recently <a href="https://www.mercomindia.com/cerc-proposes-amendments-boost-renewable-energy-certificates-trading/" target="_blank" rel="noopener">issued</a> draft amendments to the REC Regulations proposing clearer eligibility criteria for captive projects. They establish a new timetable for REC applications, update the methodology for certificate multipliers, and address RECs under virtual power purchase agreements.</p>
<p>Subscribe to Mercom’s real-time <a href="https://mercomindia.com/product/mercoms-renewable-energy-regulatory-updates/" target="_blank" rel="noopener">Regulatory Updates </a>to ensure you don’t miss any critical updates from the renewable industry.</p>


CERC Proposes ₹245/MWh as Buyout Price Under Renewable Consumption Obligation

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