Renewable energy sector under the GHG emission reduction standards

Posted on March 31, 2011 by

Non-conventional energy sources such as wind, solar, hydropower result in zero emission of green house gases and are therefore eligible to earn carbon credits as they displace GHG intensive fossil fuel derived electricity. There are therefore a number of GHG mitigation opportunities for the RE developers. Renewable Energy development also contributes to the sustainable development of the country by reducing its fossil fuel dependence. The principle behind any GHG mitigation (carbon credits) project based on renewable energy is the reduction of GHG gases by generating clean energy that would have otherwise been generated from the conventional source i.e. fossil fuel.  To illustrate, if say 100 MWh electrical energy is generated from the wind turbines, it would displace (effectively) avoid the same quantum to be generated from a fossil fuel fired plant (coal based power) in absence of the clean source. The wind turbine thus can become eligible to claim GHG emission reduction.

The renewable energy sector in India is a treasure-trove of opportunities for the carbon markets. Consistent and continued support in the form of tax incentives, preferrential tariffs and clear policy framework has encouraged enterprises in both public and private sector to deploy renewable energy sources.  A transition from conventional energy systems to those based on renewable resources is necessary to meet the ever-increasing demand for energy and to address environmental concerns and hence this has become a part of Prime Minister’s National Action Plan on Climate Change (NAPCC).

Presently CDM and VCS are the predominant GHG reduction standards for the RE based projects. Following categories are eligible to earn carbon credits under these standards;

  1. Wind Energy
  2. Solar Power
  3. Biomass Power (Bagasse, Rice husk, Biomass briquettes, Other agricultural crop residues)
  4. Small Hydro, Mini Hydro, Micro Hydro Power
  5. Waste to energy (Methane capture and utilization-Biogas, etc)
  6. Geothermal

How to register your RE project under any of the GHG reduction standard?

All renewable energy project may not be eligible to be registered under the CDM/VCS standards. There are some modalities and procedures (Concept of baseline, additionality, etc) for the registration of such projects.  Technically any project that generate considerable quantity of energy using renewable resource and supplies it to a demand center to displace the same quantity of energy from any conventional/fossil fuel based energy generating system can earn/claim green house gas emission reductions (equivalent to one ton of carbon dioxide: 1tCO2 = 1 Certified Emission Reduction).

Presently 2044 CDM projects are registered worldwide under the category Renewable Energy including following sectors – Wind, Solar, Biomass, Bio-fuels and Small hydro. These project have been so far issued more than 35 crore CERs  (Worth about Rs. 19,400 Crores) till the end of March 2011.  In India, 417 CDM projects are registered under the same category and sectors having been issued more than 14 crore CERs (Worth about Rs. 7800 Crores) till the end of March 2011.

Above mentioned numbers show the vast potential of carbon mitigation capabilities of RE sector. Resolving technical issues and being in line with the CDM/VCS modalities and procedures can help eligible RE based projects to get registered under these standards leading to tradable carbon credits.

Visit us at Agneya