The REC mechanism supports the renewable purchase obligation (RPO) for various obligated entities, including power distribution companies, in 27 states and 7 union territories in India (ERIA, 2015). After the REC process is completed with buy bids and sell bids on power exchanges, the trading price and volume is determined by the market. The REC market has, however, remained sluggish with low prices and many unsold certificates owing to an overall low demand for RECs caused by the lack of compliance of RPO by the obligated entities (Mediratta, 2015). In order to correct for the market imbalance, the State Electricity Regulatory Commissions (SERCs) should enhance the compliance of RPO.