Prices of the certificates are down 45% when compared to 2011 with buyers unwilling to buy and sellings holding out for better prices, reported The Economic Times.
Each renewable energy certificate represents 1,000 units of renewable power.
State utilities had earlier agreed to source a part of their electricity from renewable such as biofuels, biomass, solar, wind and small hydro sectors for supply to the grid.
Commenting on the turn of events Indian Energy Exchange senior business development Rajesh K Mediratta was quoted by the agency, "If energy certificates are not sold, their incentive for generating power declines."
Causing a further tricky situation the certificates lapse at the end of a year and their declining demand has also resulted in the declining investments into the renewable energy sector of the country.
According to Bloomberg, the first three quarters of 2012 brought in investments of $125m while the corresponding figures in 2011 had stood at $337m.
