draft wind tariff fy 13-14

7/30/2019 Draft Wind Tariff FY 13-14

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RAJASTHAN ELECTRICITY REGULATORY COMMISSION,JAIPUR

In the matter of determination of generic tariff for sale of electricity from wind

power plants in the state to Distribution Licensee for FY 2013-14.

Coram:

1. Shri D.C. Samant, Chairman2. Shri S.K.Mittal, Member3. Shri S.Dhawan, Member

Draft Order

1. As per RERC (Terms and Conditions for Determination of Tariff)Regulations, 2009 (hereinafter called as RERC Tariff Regulations, 2009),

Commission may initiate process for determination of generic tariff for

Renewable Energy (RE) generating stations on Suo-Motu basis or on the

basis of Petition filed by the Nodal Agency. Commission, through this

order, contemplates to determine tariff for wind power plants on Suo-

Motu basis.

2. The RERC Tariff Regulations,2009 provide for terms and conditions fordetermination of generic tariff for wind power projects to be

commissioned during the Control Period of FY 2009-10 to FY 2013-14,

based on the parameters outlined in Part VII of these Regulations.

Commission has finalised Fourth Amendment in Tariff Regulations, 2009

vide Notification dated.18.05.2012. The amended regulation 83(6) of

the Tariff Regulations, 2009 provides that Commission shall determine

the Capital cost for wind power plants for FY 2013-14 through a

separate Order.

3. Commission, therefore, based on the benchmark capital cost for windpower plants for FY 2013-14 and performance parameters contained in

the RERC Tariff Regulations 2009 read with the said Fourth Amendment,


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proposes to determine the generic tariff for the wind power projects

getting commissioned during FY 2013-14 as briefly discussed and given

in Appendix and Annexures to the Appendix.

4. Comments/suggestions of the stakeholders on the above proposal areinvited by 25th March ,2013.

Jaipur, dated the 1st March , 2013.

(S. Dhawan)

Member

(S.K. Mittal)

Member

(D.C. Samant)

Chairman


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The levelised generic tariff for wind power projects for FY 2013-14.

1. The levelised generic tariff for wind power plants, getting commissionedduring FY 2013-14, has been worked out based on operational and

performance parameters as specified under Regulation 83(6) of RERC

Tariff Regulations, 2009 and the Financial Principles as stipulated under

Part III of RERC Tariff Regulations, 2009, read with Fourth Amendment

dated 18.05.2012. The parameters adopted in this order have been

discussed in the following sub-paras.

Capital Cost

2. Commission had determined Capital cost of Rs. 530 Lacs/MW, whichincludes Rs. 15 Lacs/MW towards the cost of wind energy evacuation

upto and including pooling station and Rs. 2 Lacs/MW payable to

Rajasthan Rajya Vidyut Prasaran Nigam Ltd for connectivity charges for

FY 2012-13. The regulation 83(6) of the Amended Regulations also

provides that Commission shall determine the Capital cost for wind

power plants for FY 2013-14 through a separate Order.

3. It may be mentioned that CERC had undertaken a fresh exercise todetermine the capital cost of wind energy projects getting

commissioned in FY 12-13. The capital cost of the previous two years

for the wind projects was determined by Central Electricity Regulatory

Commission (Terms and Conditions for Tariff Determination from

Renewable Energy Sources) Regulations, 2009. Based on the said fresh

exercise for determination of the capital cost of wind projects, CERC

specified a capital cost of Rs. 575 Lacs/MW in the new tariff Regulations

namely Central Electricity Regulatory Commission (Terms and

Conditions for Tariff Determination from Renewable Energy Sources)

Regulations, 2012 for the wind power plants getting commissioned in FY

12-13. In the new Regulation, CERC has also specified a capital cost

indexation methodology to determine capital cost of wind projects for

the subsequent years of their control period.

Appendix


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4. The State Commission had also undertaken a similar fresh exercise fordetermining the capital cost of the wind power plants getting

commissioned in FY 12-13 for determination of tariff for FY 12-13 as

against determination of tariff of previous two years on the basis of

indexation methodology given in Regulation, which was subsequently

amended vide notification dated 18.05.2012

5. CERC, for the following year i.e. FY 13-14, have worked out thenormative capital cost of wind energy projects as Rs. 595.9 Lacs/MW by

adopting the indexation formula specified in their Regulations as given

in the Draft Tariff Order of CERC dated 25.10.2012. Thus, CERC after

determining the capital cost for FY 12-13, are using a formula based on

WPI data of change in prices of Electrical Machinery and Steel for

determination of capital cost for FY 13-14.

6. Commission has given due consideration to the methodology to beadopted for working out normative capital cost for the wind projects

getting commissioned in FY 13-14. As the capital cost has already

been determined afresh in FY 12-13 in consonance with a similar

exercise undertaken by CERC for FY 12-13; the Commission deems it

appropriate to adopt the same methodology for working out variation

in capital cost for the next year, in relation to cost of FY 12-13 as is

being used by CERC based on their Regulations.

7. It may be mentioned that Draft Tariff order of CERC dated 25.10.2012envisages an increase of 3.65% in capital cost for FY 13-14 as against

the benchmark capital cost of FY 12-13. However, CERC has used WPI

data available upto July, 2012 in the said Draft Order in respect of

prices of Electrical Machinery and Steel.

8. However, the WPI data for Electrical Machinery and Steel have nowbecome available up to December 2012. Considering the same, the

rise works out to be 3.95% as against 3.65% considered by CERC in theirdraft Order.


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9. Accordingly, considering a rise of 3.95%, the capital cost of Rs. 530Lacs/MW specified by the Commission for FY 2012-13, works out to be

Rs. 550.94 Lacs/MW for FY 2013-14.

10. In light of the position discussed above, Commission considers itappropriate to adopt a capital cost of Rs. 550 Lacs/MW for wind

power plants getting commissioned during FY 2013-14, which shall

include Rs. 15 Lacs/MW towards the cost of wind energy evacuation

upto and including pooling station and Rs. 2 Lacs/MW payable

towards connectivity charges.

Debt-Equity Ratio

11. The Debt-Equity ratio of 70:30 as envisaged at regulation 17 of RERCTariff Regulations 2009 has been taken for working out the debt and

equity components of normative capital cost for determination of

levelised generic tariff.

Capacity Utilisation Factor (CUF) & de-ration in CUF

12. Regulation 83(6)(b)(ii) of RERC Tariff Regulations 2009 provides for CUFof 21% for Jaisalmer, Jodhpur and Barmer districts and 20% for other

districts. Further, regulation 83(6)(b)(iii) also stipulates a de-ration of

1.25% from 6th ,10th, 14th & 18th year in the above CUFs. Accordingly,

CUFs along with de-ration have been taken.

Operation & Maintenance Expenses

13. O&M expenses have been taken as 1.25% of capital cost for powerplant and 3% of cost of transmission line in accordance with Regulation

83 (6)(b)(iv) of RERC Tariff Regulations,2009.

Depreciation

14. In accordance with regulation 83(6)(b)(vi), the rate of the depreciationhas been considered as 5.28% of the total project cost for the first 12


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years and remaining depreciable value has been spread over the

balance useful life of the power project and transmission system.

Interest rate on long term loan and Interest on working capital requirement

15. In line with regulation 83(6)(b)(viii), the interest rate on long term loanshas been taken as 300 basis points higher than the average SBI base

rate prevalent during first six months of FY 12-13 . The average SBI base

rate for first six months of FY 2012-13 is 10.00%. Accordingly, the interest

rate of 13.00% (=10.00%+3.00%) has been taken for long term loan.

16. The repayment of loan has been taken equal to the depreciationallowed for that year as stipulated at regulation 22(3) of RERC Tariff

Regulations, 2009.

17. For the purpose of working capital requirement, the composition ofworking capital has been taken as per regulation 83(6)(b)(vii).

18. In line with regulation 83(6)(b)(vii), the interest on working capital forwind power plants has been taken as 250 basis points higher than the

average SBI base rate prevalent during first six months of FY 12-13,

which works out to be 12.50% (=10.00%+2.50%). Accordingly, a rate of

12.50% has been taken as interest rate on working capital

requirements.

Return on Equity

19. Regulation 21 provides for 16% Return on Equity base of 30%determined in accordance with regulation 17. As per regulation 21,

return on equity has been computed by grossing up the base rate of

16% with tax rate equivalent to Minimum alternate Tax (MAT) for first 10

years from COD and normal tax rate for remaining years of the project

life. The MAT rate of 20.01% (= 18.50% MAT rate+5% surcharge + 3%

education cess) has been considered for first year and a MAT rate of

19.06% (= 18.5% MAT rate + 3% education cess) has been considered


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for remaining 9 years of the first 10 years. For remaining 15 years of

project life (also equal to useful life), the normal tax rate of 30.90% (=

30% tax rate + 3% education cess) has been applied for grossing up of

Return on Equity.

Subsidy or incentive by the Central Government, including Higher

Depreciation

20. The Generation Based Incentive/Tariff Subsidy, allowed by the CentralGovt. would be governed by the terms and conditions of such

scheme.

21. As regards impact of higher depreciation admissible to wind energyprojects, the methodology as adopted in the Tariff Order dated

7.09.2012 for the wind power plants getting commissioned in FY 12-13

has been followed in this draft order also. Similarly, capitalization as

well as availability of energy in the second half of the year has been

taken exactly as was done for FY 12-13. The following paragraph

elaborates on the said points.

22. Vide GoI Notification No. 15/2012 (F. No. 149/21/2010-SO (TPL)] S.O.694(E) dated 30.03.2012, depreciation has been restricted to 15% for wind

power plants installed after 31.03.2012. However, in addition to this, an

additional depreciation of 20% has been allowed to the wind power

projects during the first year in a recent amendment in the Finance

Act, 2012. Both these rates have been considered in computing

income tax benefit as given at Annexures-I and II. In this computation,the methodology of taking capitalization during the second half of the

year, as has been followed by CERC for working out the benefit of

accelerated depreciation has been applied. The energy available in

the second half of the year has been taken as 30% of annual

generation. The levelised generic tariff has been worked out

considering both the situations viz. if higher depreciation benefit is

availed and if not availed.


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Tariff period and Levelised Tariff

23. The levelised tariff has been determined for the useful life of the windpower projects i.e. for 25 years as per note (ii) of regulation 83(6)(b)(viii)

of RERC Tariff Regulations 2009. Therefore, the PPA should also be for 25

years.

24. In light of the above position, the levelised generic tariff for wind powerplant for FY 2013-14 has been determined as under:

Table: Tariff for wind power plants getting commissioned during FY 13-14

S.

No.Particulars

Tariff (Rs./kWh)

if higherdepreciation

benefit is not

availed

Tariff (Rs./kWh) if

higherdepreciation

benefit is

availed

1 2 3 4

1 Wind Power Plants located

in Jaisalmer, Jodhpur &

Barmer districts

5.48 5.17

2 Wind Power Plants located

in districts other than

Jaisalmer, Jodhpur &Barmer districts.

5.75 5.43

25. A generator claiming the higher tariff worked out as above for projectsnot availing higher depreciation benefit would have to furnish an

undertaking in advance to the buyer regarding higher depreciation

benefit not being availed and this would have to be followed for each

financial year. Similarly, annual undertaking would need to be

furnished if CDM benefit is not availed. However, if CDM benefit is

availed, it would have to be shared with distribution licensee as

envisaged in applicable Regulations.

26. The detailed calculations for determination of tariff are annexed asunder:

(1) Tariff determination of Wind Energy Power Plant - Annexure-Ilocated in Jaisalmer, Jodhpur & Barmer districts


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(2) Tariff determination of Wind Energy Power Plant - Annexure-IIlocated in districts other than Jaisalmer,Jodhpur

& Barmer districts

****************


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TARIFF FOR WIND POWER PLANTS LOCATED IN JAISALMER,BARMER & JODHPUR DISTRICTS

Annexure-I

5.47

5.

0.31

5.16

5.

Case Select Option 1

S. No.Assumption

HeadSub-Head Sub-Head (2) Unit Base Case

1 Power Generation

Capacity

Installed Power Generation Capacity MW

CUF % 21

Life of Transmission system Years

Life of Power Plant Years

2 Project Cost

Capital Cost/MW inc Land,Trans &Connectivity charges(Rs 2 Lacs) Rs Lacs/MW 5Project Cost Power Plant Cost Rs Lacs 5

Tranmssion line Cost Rs Lacs/MW

3 Sources of FundsDebt: Equity

Debt % 70

Equity % 30

Total Debt Amount Rs Lacs 3

Total Equity Amout Rs Lacs 1

Funding Options-1 (Domestic Loan Source-1)

Loan Amount Rs Lacs 3

Moratorium Period years

Intrest Rate % 13.00

Funding Options-2 ( Equity Finance )

Equity amount Rs Lacs 1

Return on Equity % p.a 16.00

Discount Rate (equiv. to WACC) 13.90

4 Financial Assumptions

Fiscal Assumptions

Income Tax % 30.90

MAT Rate (for yr-1) % 20.01

MAT Rate (for yr-2 to yr-10) % 19.06

80 IA benefits Yes/No Y

Higher Depreciation Rs/kWh 0.

Depreciation

Depreciation Rate(power plant) % 5.28

Depreciation Rate(Transmission) % 5.28

Years for 5.28% rate

5 Working Capital Requirement

O&M Charges Months

Maintenance Spare (% of O&M exepenses) % 15

Receivables for Debtors Months 1

Intrest On Working Capital % 12.50

6 Operation & Maintenance Expenses

power plant % of capital cost % 1.25

Transmission lines % of transmission line cost % 3.0

Total O & M Expenses Escalation % 5.72

Months of Operations MU

Working Hours/Day Hrs

No. of Days Days 3

Total No. of Hours Hrs 87

Levelised Tariff (Rs/kWh) without HD

Higher Depreciation benefit(Rs/kWh)

Levelised Tariff (Rs/kWh) with DD

Levelised Tariff (Rs/kWh) with HD (Rounding off)

Levelised Tariff (Rs/kWh) without HD(Rounding off)


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TARIFF FOR WIND POWER PLANTS LOCATED IN JAISALMER,BARMER & JODHPUR DISTRICTS Annexure-I contd

Units Generation Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24D er at io n i n c ap ac it y % 0% 0% 0% 0% 0% 1.25% 1.25% 1.25% 1.25% 2.50% 2.50% 2.50% 2.50% 3.75% 3.75% 3.75% 3.75% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00Installed Capacity MW 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Generation MU 1.84 1.84 1.84 1.84 1.84 1.82 1.82 1.82 1.82 1.79 1.79 1.79 1.79 1.77 1.77 1.77 1.77 1.75 1.75 1.75 1.75 1.75 1.75 1.75

Cost of generat ion Uni t Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24O&M Ex pens es Rs Lakh 7.14 7.55 7.98 8.43 8.92 9.43 9.97 10.54 11.14 11.77 12.45 13.16 13.91 14.71 15.55 1 6.44 17.38 18.37 19.43 20.54 21.71 22.95 2 4.27 25. 6

D ep re ci at io n Rs L ak h 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9 .0 4 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 1 1. 14 1 1. 14 1 1. 14 1 1 .1 4 1 1 .1 4 1 1. 14 1 1. 14 1 1. 14 1 1. 14 1 1. 14 1 1 .1 4 1 1. 1

Interest on term loan Rs Lakh 48.16 44.39 40.61 36.84 33.06 29.29 25.51 21.74 17.96 14.19 10.41 6.64 4.02 2.58 1.13 0.20 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Interest on working Capital Rs Lakh 2.07 2.03 1.99 1.95 1.91 1.87 1.84 1.80 1.77 1.74 1.80 1.77 1.48 1.49 1.51 1.53 1.57 1.62 1.67 1.72 1.77 1.83 1.89 1.95

Return on Equity Rs Lakh 33.00 32.61 32.61 32.61 32.61 32.61 32.61 32.61 32.61 32.61 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38. 2

Total Cost of generat ion Rs Lakh 119.42 115.61 112.23 108.87 105.54 102.24 98.97 95.73 92.52 89.35 91.90 88.81 68.76 68.12 67.53 67.52 68.30 69.34 70.44 71.60 72.83 74.12 75.50 76.9

Per unit Cost of generation Rs/kWh 6.49 6.28 6.10 5.92 5.74 5.63 5.45 5.27 5.09 4.98 5.12 4.95 3.83 3.85 3.81 3.81 3.86 3.97 4.03 4.10 4.17 4.24 4.32 4.40

Levellised Tariff (Rs/kWh) 5.48 25 years

Note(s):

1.Levelised tariff has been worked out by carrying out levelisation over 25 years and with normative debt equity ratio (70:30). Discounting rate equivalent to weighted average cost of capital i.e.13.90% (=0.7x 13.00%+0.3*16.0%) has been considered.

2. Figures may not tally exactly on account of rounding of .


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Determination of Higher Depreciation Benefit for Wind Power Projects

Depreciation amount 90% Annexure-I contd...

B oo k De pr ec ia ti on r at e 5 .2 8%

Tax Depreciation rate 15%

Additional depreciation rate

applicable during first year

20%

Income Tax 32.45% 30.90%

Capital Cost 550.00 Rs Lacs/MW

Year(s)--> Unit 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Book Depreciation % 2.64% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 2.88%

Book Depreciati on Rs Lacs 1 4. 52 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9 .0 4 2 9. 04 2 9. 04 2 9 .0 4 29 .0 4 2 9. 04 1 5 .8 4 0 .0 0 0 .0 0 0 .0 0 0 .0 0 0. 00 0 .0 0

Higher Depreciation Benefit

Opening balance % 100.00% 82.50% 70.13% 59.61% 50.67% 43.07% 36.61% 31.11% 26.45% 22.48% 19.11% 16.24% 13.81% 11.73% 9.97% 8.48% 7.21% 6.13% 5.21% 4.43% 3.76% 3.20% 2.72% 2.31% 1.

Allowed during the year % 17.50% 12.38% 10.52% 8.94% 7.60% 6.46% 5.49% 4.67% 3.97% 3.37% 2.87% 2.44% 2.07% 1.76% 1.50% 1.27% 1.08% 0.92% 0.78% 0.66% 0.56% 0.48% 0.41% 0.35% 0.

Closing % 82.50% 70.13% 59.61% 50.67% 43.07% 36.61% 31.11% 26.45% 22.48% 19.11% 16.24% 13.81% 11.73% 9.97% 8.48% 7.21% 6.13% 5.21% 4.43% 3.76% 3.20% 2.72% 2.31% 1.96% 1.

H ig he r d ep re ci ati on Rs L ac s 96.25 68.06 57.85 49.18 41.80 35.53 30.20 25.67 21.82 18.55 15.76 1 3.40 1 1.39 9.68 8.23 6.99 5.95 5.05 4.30 3.65 3.10 2.64 2.24 1.91

Net depreciation benefit Rs Lacs 81.73 39.02 28.81 20.14 12.76 6.49 1.16 (3.37) (7.22) (10.49) (13.28) (15.64) (17.65) (19.36) (20.81) (22.05) (23.09) (10.79) 4 .30 3.65 3.10 2.64 2.24 1.91 1

Tax Benefit Rs Lacs 2 6. 52 1 2. 06 8 .9 0 6 .2 2 3 .9 4 2 .0 1 0. 36 ( 1. 04 ) ( 2. 23 ) ( 3. 24 ) ( 4. 10 ) (4 .8 3) ( 5.4 5) ( 5. 98 ) (6 .4 3) ( 6.8 1) ( 7. 14 ) (3 .3 3) 1 .3 3 1 .1 3 0 .9 6 0 .8 2 0 .6 9 0 .5 9 0

D is co unt ed T ax Be ne fit Rs L ac s 2 6. 52 1 1. 32 7 .3 4 4 .5 0 2 .5 1 1 .1 2 0. 18 ( 0. 45 ) ( 0. 84 ) ( 1. 07 ) ( 1. 19 ) (1 .2 3) ( 1.2 2) ( 1. 18 ) (1 .1 1) ( 1.0 3) ( 0. 95 ) (0 .3 9) 0 .1 4 0 .1 0 0 .0 8 0 .0 6 0 .0 4 0 .0 3 0

L ev el is ed t ax b ene fi t Rs L ac s 5 .1 8

Energy Generation MU 0.55 1.84 1.84 1.84 1.84 1.82 1.82 1.82 1.82 1.79 1.79 1.79 1.79 1.77 1.77 1.77 1.77 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1

Discounted Generation MU 0.55 1.73 1.52 1.33 1.17 1.01 0.89 0.78 0.69 0.59 0.52 0.46 0.40 0.35 0.31 0.27 0.24 0.20 0.18 0.16 0 .14 0.12 0.11 0.09 0

Levelised generation MU 1.66

Per Unit Benefit Rs/kWh 4 .8 0 0 .6 6 0 .4 8 0 .3 4 0 .2 1 0 .1 1 0. 02 ( 0. 06 ) ( 0. 12 ) ( 0. 18 ) ( 0. 23 ) ( 0. 27 ) ( 0.3 0) ( 0. 34 ) ( 0. 36 ) ( 0.3 8) (0 .4 0) (0 .1 9) 0 .0 8 0 .0 6 0 .0 5 0 .0 5 0 .0 4 0 .0 3 0

Discount Factor 1.00 0.88 0.77 0.68 0.59 0.52 0.46 0.40 0.35 0.31 0.27 0.24 0.21 0.18 0.16 0.14 0.12 0.11 0.10 0.08 0.07 0.07 0.06 0.05

Applicable Discount Factor 1.00 0.94 0.82 0.72 0.64 0.56 0.49 0.43 0.38 0.33 0.29 0.26 0.22 0.20 0.17 0.15 0.13 0.12 0.10 0.09 0.08 0.07 0.06 0.05

Levelised ITAX benefit Rs/kWh 0.3115

Note(s):

1.In the above calculations, depreciation for the first year has been considered as 17.50%(= 50% of (15%+20%)) as per CERC methodology

3. For working out Tax benefit, income tax rate for the first year has been considered as 32.45% and a tax rate of 30.90% for subsequent years.

TARIFF FOR WIND POWER PLANTS LOCATED IN JAISALMER,BARMER & JODHPUR DISTRICTS


2. Generation for the first year has been considered as 30% of the normative generation for the second half of the financial year.


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TARIFF FOR WIND POWER PLANTS LOCATED IN DISTRICTS OTHER THAN JAISALMER,BARMER & JODHPUR

Annexure-II

5.75

5.

0.32

5.42

5.

Case Select Option 2

S. No.Assumption

HeadSub-Head Sub-Head (2) Unit Base Case

1 Power Generation

Capacity

Installed Power Generation Capacity MW

CUF % 20

Life of Transmission system Years

Life of Power Plant Years

2 Project Cost

Capital Cost/MW inc Land,Trans &Connectivity charges(Rs 2 Lacs) Rs Lacs/MW 5Project Cost Power Plant Cost Rs Lacs 5

Tranmssion line Cost Rs Lacs/MW

3 Sources of FundsDebt: Equity

Debt % 70

Equity % 30

Total Debt Amount Rs Lacs 3

Total Equity Amout Rs Lacs 1

Funding Options-1 (Domestic Loan Source-1)

Loan Amount Rs Lacs 3

Moratorium Period years

Intrest Rate % 13.00

Funding Options-2 ( Equity Finance )

Equity amount Rs Lacs 1

Return on Equity % p.a 16.00

Discount Rate (equiv. to WACC) 13.90

4 Financial Assumptions

Fiscal Assumptions

Income Tax % 30.90

MAT Rate (for yr-1) % 20.01

MAT Rate (for yr-2 to yr-10) % 19.06

80 IA benefits Yes/No Y

Higher Depreciation Rs/kWh 0.

Depreciation

Depreciation Rate(power plant) % 5.28

Depreciation Rate(Transmission) % 5.28

Years for 5.28% rate

5 Working Capital Requirement

O&M Charges Months

Maintenance Spare (% of O&M exepenses) % 15

Receivables for Debtors Months 1

Intrest On Working Capital % 12.50

6 Operation & Maintenance Expenses

power plant % of capital cost % 1.25

Transmission lines % of transmission line cost % 3.0

Total O & M Expenses Escalation % 5.72

Months of Operations MU

Working Hours/Day Hrs

No. of Days Days 3

Total No. of Hours Hrs 87

Levelised Tariff (Rs/kWh) without HD

Higher Depreciation benefit(Rs/kWh)

Levelised Tariff (Rs/kWh) with DD

Levelised Tariff (Rs/kWh) with HD (Rounding off)

Levelised Tariff (Rs/kWh) without HD(Rounding off)


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TARIFF FOR WIND POWER PLANTS LOCATED IN DISTRICTS OTHER THAN JAISALMER,BARMER & JODHPUR Annexure-II contd

Units Generation Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24D er at io n i n c ap ac it y % 0% 0% 0% 0% 0% 1.25% 1.25% 1.25% 1.25% 2.50% 2.50% 2.50% 2.50% 3.75% 3.75% 3.75% 3.75% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00Installed Capacity MW 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Generation MU 1.75 1.75 1.75 1.75 1.75 1.73 1.73 1.73 1.73 1.71 1.71 1.71 1.71 1.69 1.69 1.69 1.69 1.66 1.66 1.66 1.66 1.66 1.66 1.66

Cost of generat ion Uni t Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24O&M Ex pens es Rs Lakh 7.14 7.55 7.98 8.43 8.92 9.43 9.97 10.54 11.14 11.77 12.45 13.16 13.91 14.71 15.55 1 6.44 17.38 18.37 19.43 20.54 21.71 22.95 2 4.27 25. 6

D ep re ci at io n Rs L ak h 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9 .0 4 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 1 1. 14 1 1. 14 1 1. 14 1 1 .1 4 1 1 .1 4 1 1. 14 1 1. 14 1 1. 14 1 1. 14 1 1. 14 1 1 .1 4 1 1. 1

Interest on term loan Rs Lakh 48.16 44.39 40.61 36.84 33.06 29.29 25.51 21.74 17.96 14.19 10.41 6.64 4.02 2.58 1.13 0.20 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Interest on working Capital Rs Lakh 2.07 2.03 1.99 1.95 1.91 1.87 1.84 1.80 1.77 1.74 1.80 1.77 1.48 1.49 1.51 1.53 1.57 1.62 1.67 1.72 1.77 1.83 1.89 1.95

Return on Equity Rs Lakh 33.00 32.61 32.61 32.61 32.61 32.61 32.61 32.61 32.61 32.61 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38. 2

Total Cost of generat ion Rs Lakh 119.42 115.61 112.23 108.87 105.54 102.24 98.97 95.73 92.52 89.35 91.90 88.81 68.76 68.12 67.53 67.52 68.30 69.34 70.44 71.60 72.83 74.12 75.50 76.9

Per unit Cost of generation Rs/kWh 6.82 6.60 6.41 6.21 6.02 5.91 5.72 5.53 5.35 5.23 5.38 5.20 4.03 4.04 4.00 4.00 4.05 4.17 4.23 4.30 4.38 4.45 4.54 4.62

Levellised Tariff (Rs/kWh) 5.75 25 years

Note(s):

1.Levelised tariff has been worked out by carrying out levelisation over 25 years and with normative debt equity ratio (70:30). Discounting rate equivalent to weighted average cost of capital i.e.13.90% (=0.7x 13.00%+0.3*16.0%) has been considered.



15/17

Determination of Higher Depreciation Benefit for Wind Power Projects

Depreciation amount 90% Anne xur e- II c ont d. ..

B oo k De pr ec ia ti on r at e 5 .2 8%

Tax Depreciation rate 15%

Additional depreciation rate

applicable during first year

20%

Income Tax 32.45% 30.90%

Capital Cost 550.00 Rs Lacs/MW

Year(s)--> Unit 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Book Depreciation % 2.64% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 2.88%

Book Depreciati on Rs Lacs 1 4. 52 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9 .0 4 2 9. 04 2 9. 04 2 9 .0 4 29 .0 4 2 9. 04 1 5 .8 4 0 .0 0 0 .0 0 0 .0 0 0 .0 0 0. 00 0 .0 0

Higher Depreciation Benefit

Opening balance % 100.00% 82.50% 70.13% 59.61% 50.67% 43.07% 36.61% 31.11% 26.45% 22.48% 19.11% 16.24% 13.81% 11.73% 9.97% 8.48% 7.21% 6.13% 5.21% 4.43% 3.76% 3.20% 2.72% 2.31% 1.

Allowed during the year % 17.50% 12.38% 10.52% 8.94% 7.60% 6.46% 5.49% 4.67% 3.97% 3.37% 2.87% 2.44% 2.07% 1.76% 1.50% 1.27% 1.08% 0.92% 0.78% 0.66% 0.56% 0.48% 0.41% 0.35% 0.

Closing % 82.50% 70.13% 59.61% 50.67% 43.07% 36.61% 31.11% 26.45% 22.48% 19.11% 16.24% 13.81% 11.73% 9.97% 8.48% 7.21% 6.13% 5.21% 4.43% 3.76% 3.20% 2.72% 2.31% 1.96% 1.

H ig he r d ep re ci ati on Rs L ac s 96.25 68.06 57.85 49.18 41.80 35.53 30.20 25.67 21.82 18.55 15.76 1 3.40 1 1.39 9.68 8.23 6.99 5.95 5.05 4.30 3.65 3.10 2.64 2.24 1.91

Net depreciation benefit Rs Lacs 81.73 39.02 28.81 20.14 12.76 6.49 1.16 (3.37) (7.22) (10.49) (13.28) (15.64) (17.65) (19.36) (20.81) (22.05) (23.09) (10.79) 4 .30 3.65 3.10 2.64 2.24 1.91 1

Tax Benefit Rs Lacs 2 6. 52 1 2. 06 8 .9 0 6 .2 2 3 .9 4 2 .0 1 0. 36 ( 1. 04 ) ( 2. 23 ) ( 3. 24 ) ( 4. 10 ) (4 .8 3) ( 5.4 5) ( 5. 98 ) (6 .4 3) ( 6.8 1) ( 7. 14 ) (3 .3 3) 1 .3 3 1 .1 3 0 .9 6 0 .8 2 0 .6 9 0 .5 9 0

Discounted Tax Benefit Rs Lacs 26.52 11.32 7.34 4.50 2.51 1.12 0.18 (0.45) (0.84) (1.07) (1.19) (1.23) (1.22) (1.18) (1.11) (1.03) (0.95) (0.39) 0.14 0.10 0.08 0.06 0.04 0.03 0

Levelised tax benefit Rs Lacs 5.18

Energy Generation MU 0.53 1.75 1.75 1.75 1.75 1.73 1.73 1.73 1.73 1.71 1.71 1.71 1.71 1.69 1.69 1.69 1.69 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1

Discounted Generation MU 0.53 1.65 1.44 1.27 1.11 0.97 0.85 0.74 0.65 0.57 0.50 0.44 0.38 0.33 0.29 0.26 0.22 0.19 0.17 0.15 0.13 0.12 0.10 0.09 0

Levelised generation MU 1.58

Per Unit Benefit Rs/kWh 5 .0 5 0 .6 9 0 .5 1 0 .3 6 0 .2 3 0 .1 2 0. 02 ( 0. 06 ) ( 0. 13 ) ( 0. 19 ) ( 0. 24 ) ( 0. 28 ) ( 0.3 2) ( 0. 35 ) ( 0. 38 ) ( 0.4 0) (0 .4 2) (0 .2 0) 0 .0 8 0 .0 7 0 .0 6 0 .0 5 0 .0 4 0 .0 4 0

Discount Factor 1.00 0.88 0.77 0.68 0.59 0.52 0.46 0.40 0.35 0.31 0.27 0.24 0.21 0.18 0.16 0.14 0.12 0.11 0.10 0.08 0.07 0.07 0.06 0.05

Applicable Discount Factor 1.00 0.94 0.82 0.72 0.64 0.56 0.49 0.43 0.38 0.33 0.29 0.26 0.22 0.20 0.17 0.15 0.13 0.12 0.10 0.09 0.08 0.07 0.06 0.05

Levelised ITAX benefit Rs/kWh 0.3271

Note(s):

1.In the above calculations, depreciation for the first year has been considered as 17.50%(= 50% of (15%+20%)) as per CERC methodology

3. For working out Tax benefit, income tax rate for the first year has been considered as 32.45% and a tax rate of 30.90% for subsequent years.

TARIFF FOR WIND POWER PLANTS LOCATED IN DISTRICTS OTHER THAN JAISALMER,BARMER & JODHPUR


2. Generation for the first year has been considered as 30% of the normative generation for the second half of the financial year.


16/17

Rajasthan Electricity Regulatory Commission

Vidyut Viniyamak Bhawan, Near State Motor Garage,Sahakar Marg, Jaipur-302001

Phone: 0141-2741299,2740067, Fax:0141-2741018, E-mail: [email protected]

website: www.rerc.rajasthan.gov.in

PUBLIC NOTICE

Notice is hereby issued under Section 64 (2) read with 61(h),62(1)(a) and 86 (1) (e) of

the Electricity Act, 2003 for determination of levelised generic tariff for sale of

electricity by Wind power plants to distribution companies of the State based on the

parameters specified in RERC(Terms & Conditions for determination of Tariff)

Regulations, 2009 read with Fourth Amendment in RERC Tariff Regulations. The

levelised generic Tariff proposed for FY 2013-14 is as under:

S.

No.Particulars

Tariff

(`/kWh) ifhigher

depreciation

benefit is not

availed

Tariff

(`/kWh) ifhigher

depreciation

benefit is

availed

1 2 3 4

1 Wind Power Plants located in Jaisalmer,

Jodhpur & Barmer districts

5.48 5.17

2 Wind Power Plants located in districts other

than Jaisalmer, Jodhpur & Barmer districts.

5.75 5.43

The above tariff is levelised for 25 years.

Any persons desirous of offering suggestions/comments on the aforesaid tariff

proposal may do so in five copies, so as to reach this office by 25 th March, 2013with

copies of supporting details. The suggestions/comments can also be sent to the

Commission through e-mail at [email protected] . The copy of the draft order is

also available with the Receiving Officer of the Commission and can be obtained

on payment of Rs 100/-. The draft order is also available on Commissions website

www.rerc.rajasthan.gov.in. The hearing in the matter shall be held on 9th April, 2013

at 11.30 AM in RERCs office, Jaipur. Persons giving suggestions/comments by the

said date and desiring personal hearing could do so during the said hearing.

G.K.Sharma

(Secretary )

(Not to be published)

G.K.Sharma

(Secretary)


17/17

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draft wind tariff fy 13-14

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