April 3 (Bloomberg) -- Giriraj Enterprises Ltd. of India completed 33 megawatts of solar-power capacity, the most to be built under the nation’s Renewable Energy Credits mechanism.
The company started output from three projects of 19, 11 and 3 megawatts in the western state of Rajasthan last week, Prafulla Khinvasara, the company’s chief executive officer for renewable-power projects, said by telephone.
Companies such as Giriraj, a tobacco trader, are building solar generators to benefit from renewable-energy incentives. Producers of clean power can earn certificates for the output they send to the grid. They can then sell the credits to state power distributors that are obliged to buy a portion of their electricity from clean sources such as wind, solar and water.
Giriraj has signed a power purchase agreement with the local state-owned electricity distributor, Khinvasara said from Sangamner in Maharashtra state, where the company is based. Giriraj will be able to sell electricity at an average price of 2.7 rupees (5 cents) a unit, and expects to trade 53,000 certificates a year, he said.
Indian demand for renewable-energy credits, or RECs, almost tripled last month to 435,481 in the run-up to the fiscal year-end. Solar credits sold for 13,400 rupees apiece on the Indian Electricity Exchange, according to REConnect Energy Solutions Pvt.
“The Indian REC market is considered risky and unpredictable by investors,” said Bharat Bhushan, a New Delhi-based analyst with Bloomberg New Energy Finance. “Thirty-three megawatts is the largest solar REC project in India and it is not a normal practice to see such large investments in solar RECs.”
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