CERC Allows IEX to Revise Green Market Contracts Under New RCO Framework, Sellers Must Furnish Category-Specific NOC; NLDC Directed to Update NOAR Portal and T-GNA Procedures Within 4 Weeks

In a significant milestone for India’s power market evolution, the Central Electricity Regulatory Commission (CERC) has issued an order dated May 28, 2026, approving the Indian Energy Exchange’s (IEX) proposal to overhaul its Green Contracts framework. The decision effectively bridges the regulatory gap between the Electricity Act, 2003, and the Energy Conservation (Amendment) Act, 2022, by aligning exchange-traded products with the Ministry of Power’s (MoP) Renewable Consumption Obligation (RCO) framework notified in September 2025.

Transitioning to Technology-Specific RE Classifications

The Commission’s approval marks a formal departure from the legacy “Solar,” “Non-Solar,” and “Hydro” classifications, which regulators and market experts have increasingly viewed as inadequate for a maturing grid. This shift, driven by the Energy Conservation (Amendment) Act, 2022, acknowledges that different renewable technologies offer varying levels of grid supportiveness and maturity. By moving to a granular structure, the framework allows for more precise accounting of the “Consumption” obligations now required of a broader range of “Designated Consumers,” including energy-intensive industries like steel, cement, and railways.

Eligibility and Rationale for New Categories:

• Wind RE: Limited to wind projects commissioned after March 31, 2024, to incentivize new capacity.
• Hydro: Encompasses all hydro projects (including pumped storage and small hydro) commissioned after March 31, 2024, reflecting the technology’s role in grid balancing.
• Distributed RE (DRE): Covers projects under 10 MW, specifically capturing high-growth segments such as rooftop solar and behind-the-meter installations that are increasingly critical for commercial and industrial (C&I) decarbonization.
• Other RE: Aggregates technology types such as biomass and municipal solid waste-to-energy.

Market Democratization via Technical Revisions

This reclassification permeates IEX’s entire green market suite, impacting the Green Day Ahead Market (G-DAM), Green Day Ahead Contingency (G-DAC), Green Intra-day Contracts (G-IDC), and all Daily, Weekly, Monthly, and Any Day(s) Single Sided Contracts (G-ADSS).

Crucially, the CERC approved a reduction in the minimum volume quotation for Green Intra-Day and Green-DAC contracts from 220 kW (0.220 MW) to 100 kW (0.1 MW). This is not merely a technical adjustment but a strategic alignment with Regulation 26.4 of the GNA Regulations and the Green Energy Open Access Rules. By lowering the entry threshold, the Commission is effectively democratizing the green market, enabling smaller C&I consumers to actively participate and manage their renewable energy portfolios.

Operational Mandates: NOCs and Traceability

To ensure the integrity of the new framework, the CERC has tightened documentation requirements. Sellers must now provide category-specific No Objection Certificates (NOC) or standing clearances that explicitly identify the source (e.g., Wind, DRE) to allow for automated compliance tracking.

A key regulatory focus in the order is the directive regarding portfolio-based sales by DISCOMs. To prevent the risk of “double counting”—where the same green attribute might be claimed under both RPO and RCO regimes—IEX is now required to explicitly disclose the name and specific RE source of the generating plants. This level of transparency is vital for the traceability of green power as it moves through the exchange.

NLDC Directives and Implementation Timelines

Recognizing that the operational success of this transition hinges on technical infrastructure, the Commission has directed the National Load Despatch Centre (NLDC) to update the National Open Access Registry (NOAR) portal and Temporary General Network Access (T-GNA) procedures within a 4-week deadline.

These modifications are essential because NOAR serves as the central clearinghouse for standing clearances. Without these updates, sellers would remain unable to secure the category-specific clearances needed to distinguish between “Wind” or “Hydro” in market bids, effectively stalling the implementation of the new RCO framework.

RCO Compliance Trajectory and Fungibility Protocols

The order is a prerequisite for meeting India’s escalating RCO trajectory, which sees total renewable obligations rising from 29.91% in FY25 to 43.33% by FY30. To provide market flexibility while maintaining technology-specific goals, the CERC upheld the following fungibility protocols:

• Wind, Hydro, and Other RE: Surplus procurement in any of these categories may offset shortfalls in others, as per the MoP’s flexibility norms.
• Distributed RE (DRE): Reflecting its status as a high-priority segment, DRE obligations remain non-fungible. Shortfalls in DRE cannot be covered by surpluses in other categories, making it a “hard” obligation for participants.

Software Alignment and Strategic Intent

IEX is now mandated to execute comprehensive software updates to its trading platform and align its business rules, bye-laws, and operational frameworks with this revised structure. This regulatory shift represents a strategic evolution in Indian power trading, moving toward a more sophisticated market that rewards not only the volume of renewable energy generated but also the specific technology and grid-supportive characteristics of the energy consumed.