India emerged as a key player in the recent international climate talks in Paris. On the global stage, India reiterated its commitment towards clean energy and reducing carbon emissions.1 India’s increased thrust on renewable energy is outlined in the 2015 national budget, which set a five-fold increase in renewable energy targets to achieve 175 GW by 2022.

State distribution companies (Discoms) are by far the largest purchaser of electricity, including that from renewable energy sources. Therefore, the ability of the Discoms to purchase such power lies at the heart of the success of the national level directional shift from conventional to renewable power. However, presently, Discoms are reeling under massive debts and their actions are often dictated by local political factors rather than the achievement of operational and technical efficiency.

This CPR-RAP paper proposes to analyse the existing constitutional and regulatory framework within which Discoms and other key stakeholders in the renewable power sector operate. The paper also offers an insight into the perspectives of Discoms, regulators and governments on RPO compliance. Further, the larger debate surrounding electricity sector reform and its implications for the renewable power sector have been analysed.

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