jammu & kashmir state electricity regulatory … levelised tariff for res_fy 2014-15...jammu...

Jammu & Kashmir

State Electricity Regulatory Commission

Order

inthe matter of

Determination of Generic LevellisedGeneration Tariff

for Renewable Energy Sources (RES) for FY2014-15

Jammu & Kashmir State Electricity Regulatory Commission Website:http://www.jkserc.nic.in& Email ID: [email protected], [email protected]

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bridge), Srinagar-190014 (J&K) Ph: 0194-2434582, Fax: 0194-2431817

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THIS SPACE IS INTENTIONALLY LEFT BLANK

Determination of Generic Levellised Generation Tariff for RES FY2014-15

JKSERC Order Page 1

Before

Jammu & Kashmir State Electricity Regulatory Commission

Suo-motoPetition No: JKSERC/45 of 2014

In the Matter of:

Determination of generic levellised generation tariff for the FY2014-15 under Regulation 8 of

the Jammu and Kashmir StateElectricity Regulatory Commission (Terms and Conditions for

Tariffdetermination from Renewable Energy Sources) Regulations, 2013.

OrderNo.:JKSERC/ 38 of 2014

(Dated:18th

July, 2014)

1. The Jammu & Kashmir State Electricity Regulatory Commission (hereinafter referred to

as JKSERC or the Commission) has notified the Jammu and Kashmir StateElectricity

Regulatory Commission (Terms and Conditions for Tariffdetermination from Renewable

Energy Sources) Regulations, 2013 on 17th

May 2013 (hereinafter referred to as

“the RE Tariff Regulations 2013”) which provide for terms and conditions and the

procedure for determination of tariff of the following categories of Renewable Energy

(RE) generating stations:

a. Wind Power Project;

b. Biomass Power Projects with Rankine Cycle Technology;

c. Non-fossil fuel-based co-generation project;

d. Small Hydro plants;

e. Solar Photo Voltaic (PV) / Solar Thermal Power Projects;

f. Biomass Gasifier based Power Projects; and

g. Biogas based Power Project.


JKSERC Order Page 2

2. The Regulations enjoin upon the Commission to determine the generic tariff on the basis

of the suo-motu petition, for the RE technologies for which norms have been provided in

the RE Tariff Regulations 2013. Generic Tariff is different from the project specific tariff

for which a project developer has to file petition before the Commission as per the format

provided in the RE Tariff Regulations 2013. Pertinently, project specific tariff has been

envisaged for the new RE technologies and the technologies which are still at the nascent

stage of development, and the Commission shall determine the project specific tariff for

such technologies on a case to case basis.

3. Clause (1) of Regulation 8 of the RE Tariff Regulations 2013 provides that

“the Commission shall determine the generic tariff on the basis of suo-motu petition at

least six months in advance at the beginning of each year of the Control period for

renewable energy technologies for which norms have been specified under the

Regulations”.

4. The Commission, in due discharge of the mandate under Regulation 8(1) of RE Tariff

Regulations 2013, brought out the proposal in the matter of determination of the generic

tariff for renewable energy technologies for the year FY 2014-15 vide the suo-motu

Petition No. JKSERC/45 of 2014 dated 13th

day of March, 2014.

5. The Commission gave a presentation on the proposed generic tariff for generation of

power from Renewable Energy Sources (RES)for the year FY 2014-15 in a meeting

convened with the Members of the State Advisory Committee (SAC) on 22nd

April 2014.

6. The SAC Members advised that JKSERC should go ahead with the notification of the

Draft Tariff Order after seeking suggestions/comments from the stakeholders.

7. In due regard to the Model Code of Conduct imposed by the Election Commission of

India in connection with the 16th

Lok Sabha Elections, the Commission published the gist

of the suo-motu Petition in several widelyread newspapers of the State in June 2014.The

list of newspapers in which gist was published is as follows:

Table 1: List of Newspapers in whichthe gist was published

Sl. No. Newspaper Date of Publication

1. Aftab 04.06.2014

2. Rising Kashmir 04.06.2014

3. Excelsior 04.06.2014

4. Amar Ujala 04.06.2014

5. Greater Kashmir 05.06.2014

8. The Petition was also made available on the website of the Commission. The stakeholders

were requested to submit their written comments / suggestions / objections latest by 30th

June 2014. The suggestions made by the members of the State Advisory Committee and

other points discussed have been considered by the Commission in this Order.


JKSERC Order Page 3

Approved generic levellised tariff for RES for FY 2014-15

9. The approved genericlevellised tariff for generation from renewable energy sourcesfor

FY 2014-15 is summarized in the following tables. The determination and basis of

approval of generic levellised tariff for generation from renewable energy technologies

for FY 2014-15 has been explained in ensuing chapter of this Tariff Order.

Table 2: Generic Levellised tariff for RE technologies without fuel component for FY 2014-15

Particulars

Levellised Total

Tariff

(FY 2014-15)

Benefit of

Accelerated

Depreciation (if

availed)

Net Levellised Tariff

(upon adjusting for

Accelerated

Depreciation

benefit) (if availed)

(Rs/kWh) (Rs/kWh) (Rs/kWh)

WIND ENERGY

Wind Zone -1 (CUF 20%) 6.16 0.36 5.80

Wind Zone -2 (CUF 22%) 5.60 0.33 5.27

Wind Zone -3 (CUF 25%) 4.93 0.29 4.64

Wind Zone -4 (CUF 30%) 4.11 0.24 3.87

Wind Zone -5 (CUF 32%) 3.85 0.23 3.62

SMALL HYDRO

Capacity below 5 MW 4.30 0.39 3.91

Capacity 5 MW upto 25 MW 3.67 0.35 3.32

SOLAR PV & THERMAL

Solar PV 7.50 0.83 6.67

Solar Thermal 11.55 1.32 10.23

Table 3: Generic tariff for RE technologies with fuel component for FY 2014-15

Particulars

Levellised

fixed cost

Variable cost

(FY 2014-15)

Applicable

Tariff

(FY 2014-

15)

Benefit of

Accelerated

Depreciation

(if availed)

Net Levellised

Tariff

(upon adjusting

for

Accelerated

Depreciation

benefit,

if availed)

(Rs/kWh) (Rs/kWh) (Rs/kWh) (Rs/kWh) (Rs/kWh)

BIOMASS 2.11 3.73 5.84 0.16 5.68

NON FOSSIL FUEL

BASED COGENERATION 2.48 3.10 5.58 0.22 5.36

BIOMASS GASIFIER 2.34 4.93 7.27 0.14 7.13

BIOGAS 3.04 2.00 5.04 0.35 4.69


JKSERC Order Page 4

10. This Order does not take into account the incentive or subsidy or financial assistance,

other than accelerated depreciation benefits,as may be available from the Central / State

Government for renewable energy technologies. Accordingly, the Commission directs

the developer availing any such incentive or subsidy (other than accelerated

depreciation benefits) to submit a Petition in accordance with the Regulations 7 and

Regulation 8 of the RE Tariff Regulations 2013 for determination of project specific

tariff.

Implementation of Order

11. In exercise of the powers vested in it under the Jammu & Kashmir Electricity Act, 2010

(Act XIII of 2010), the Commission hereby passes this Order today i.e. on the

18th

July 2014. The tariff approved by the Commission herewith, shall remain in force till

31st March 2015 unless amended or modified by an Order of the Commission.

Ordered as above, read with attached detailed reasons, grounds and conditions.

Dated:18

thJuly2014

Place: Srinagar


JKSERC Page 2

TABLE OF CONTENTS

GENERIC LEVELLISED GENERATION TARIFF FOR VARIOUS RENEWABLE

ENERGY TECHNOLOGIES FOR FY 2014-15 ................................................................... 3

Generic norms ............................................................................................................................ 3

Generation norms ....................................................................................................................... 5

Determination of Capital cost .................................................................................................... 6

Determination of fixed cost components ................................................................................. 13

Determination of fuel cost components ................................................................................... 18

Subsidy or incentive by the Central / State Government ......................................................... 21

APPENDIX-1CAPITAL COST FOR WIND ENERGYPROJECT ................................. 24

APPENDIX-2CAPITAL COST FOR SMALL HYDRO PROJECT................................ 25

APPENDIX-3CAPITAL COST FORBIOMASS BASED PROJECT ............................. 26

APPENDIX-4CAPITAL COST FOR NON FOSSIL FUEL BASED

COGENERATION ................................................................................................................. 27

APPENDIX-5CAPITAL COST FOR BIOMASS GASSIFIER BASED POWER

PROJECTS ............................................................................................................................. 28

APPENDIX-6 CAPITAL COST FOR BIOGAS BASED PROJECTS ............................ 29

APPENDIX-7BIOMASS FUEL PRICE ............................................................................. 30

APPENDIX-8BAGASEE PRICE ........................................................................................ 32

APPENDIX-9BIOGAS PRICE ............................................................................................ 34

ANNEXURES ....................................................................................................................... 37

Annexure 1 AWind Power Projects – Wind Zone 1…….………………………………...40

Annexure 1 BWind Power Projects – Wind Zone 2…….………………………………...43

Annexure 1 CWind Power Projects – Wind Zone 3…….………………………………...46

Annexure 1 DWind Power Projects – Wind Zone 4…….………………………………...49

Annexure 1 EWind Power Projects – Wind Zone 5…….………………………………...52

Annexure 2 ASmall Hydro Power Projects –Capacity below 5 MW…...………………...55

Annexure 2B Small Hydro Power Projects –Capacity 5 MW up to 25 MW…..…………58

Annexure 3 Biomass Power Projects………………….………………………………...61

Annexure 4Non Fossil Fuel Based Cogeneration Power Projects………………………64

Annexure 5Solar PV Power Projects ….……...…..….…………….…...……………....67

Annexure 6Solar Thermal Power Projects………………….……….……..…………...70

Annexure 7 BiomassGassifier Power Projects………………….….…...……………...73

Annexure 8Biogas Power Projects ………………….……………………………….....76


JKSERC Page 3

GENERIC LEVELLISED GENERATION TARIFF FOR VARIOUS

RENEWABLE ENERGY TECHNOLOGIES FOR FY 2014-15

1.1. The generic levellised generation tariff for various Renewable Energy Technologies

(RETs) for FY 2014-15 are discussed below:

Generic norms

Useful life

1.2. Clause (aa) of sub-Regulation (1) of Regulation 2 of the RE Tariff Regulations 2013

defines ‘useful life’ in relation to a unit of a generating station including evacuation

system to mean the following duration from the date of commercial operation (COD)

of such generation facility:

Table 4: Useful life of RE Projects

Renewable energy projects Useful Life (in years)

Wind energy 25

Biomass power project with rankine cycle technology 20

Non-fossil fuel based co-generation 20

Small hydro plant 35

Solar PV/ Solar thermal power project 25

Biomass gasifier 20

Biogas 20

Control period

1.3. Regulation 5 of the RE Tariff Regulations 2013 provides that the control period for

determination of tariff for renewable energy projects (RE projects) shall be of five

years. The first year of the control period was from FY 2013-14.

1.4. The Provision to the said regulation stipulates that the tariff determined for the RE

projects commissioned duringthe control period shall continue to be applicable for the

entire duration of the tariff period as specified in Regulation 6 of the RE Tariff

Regulations 2013.

Tariff period

1.5. In terms of Regulation 6 of the RE Tariff Regulations 2013, the tariff period in respect

of the RE projects is as under:

Table 5: Tariff period for RE Projects


Wind energy 13*

Biomass power project with rankine cycle technology 13*


JKSERC Page 4


Non-fossil fuel based co-generation 13*

Small hydro plant below 5 MW capacity 35

Small hydro plant - 5 MW upto 25 MW capacity 13*

Solar PV/ Solar thermal power project 25

Biomass gasifier& Biogas 20

*The RE Tariff Regulations provide for a minimum tariff period of thirteen years

1.6. In terms of clauses (e) and (f) of the said regulation, the tariff period specified above

shall be reckoned from the date of commercial operation of the RE projects and the

tariff determined under the regulations shall be applicable for the duration of the tariff

period.

Tariff structure

1.7. Clause (1) of Regulation 9 of the RE Tariff Regulations 2013 stipulates that the tariff

for RE projects shall be single part tariff consisting of the following fixed cost

components:

(a) Return on equity;

(b) Interest on loan capital;

(c) Depreciation;

(d) Interest on working capital;

(e) Operation and maintenance expenses;

1.8. For renewable energy technologies having fuel cost component, like biomass power

projects and non-fossil fuel based cogeneration, single part tariff with two

components, fixed cost component and fuel cost component, is to be determined

Tariff design

1.9. In terms of Regulation 10 of the RE Tariff Regulations 2013, the tariff design for

renewable energy generating stations is as under:

"(1) The generic tariff shall be determined on levellised basis for the Tariff Period.

Provided that for renewable energy technologies having single part tariff with

two components, tariff shall be determined on levellised basis considering the

year of commissioning of the project for fixed cost component while the fuel cost

component shall be specified on year of operation basis.

(2) For the purpose of levellised tariff computation, the discount factor equivalent to

Post Tax weighted average cost of capital shall be considered.


JKSERC Page 5

(3) Levellisation shall be carried out for the ‘useful life’ of the Renewable Energy

project while Tariff shall be specified for the period equivalent to ‘Tariff Period.”

1.10. Accordingly, levellisedtariff is calculated by carrying out levellisation for ‘useful life’ of

each technology considering the discount factor for time value of money.

1.11. The discount factor considered for this purpose is equal to the Post Tax weighted

average cost of the capital on the basis of normative debt: equity ratio (70:30)

specified in the RE Tariff Regulations 2013. Considering the normative debt equity

ratio and weighted average of the post tax rates for interest and equity component, the

discount factor is calculated.

1.12. Interest Rate considered for the loan component (i.e.70% of capital cost) is 13.25%

(as explained later). For equity component (i.e. 30% of capital cost) rate of Return on

Equity (ROE) is considered at Post Tax ROE of 16%. The discount factor derived by

this method for all technology is 10.92 % i.e. ((13.25% × 0.70 × (1 – 33.99%)) +

(16.0% × 0.30)).

Generation norms

Capacity utilisation factor (CUF)/ Plant load factor (PLF)

1.13. Regulations 26, 30, 58 and 62 of the RE Tariff Regulations 2013 specify the norms

for Capacity Utilization Factor (CUF) in respect of the Wind Energy, Small Hydro,

Solar PV and Solar Thermal based power generating stations as per the details given

in the table below which has been considered for determination of tariff.

Table 6: Capacity utilisation factor for RE projects

Sl. No. Renewable energy projects CUF (%)

(A) Wind energy

i. Wind Zone 1 (annual Mean Wind Power Density upto 200 w/m2) 20%

ii. Wind Zone 2 (annual Mean Wind Power Density 201 - 250 w/m2) 22%

iii. Wind Zone 3 (annual Mean Wind Power Density 251 - 300 w/m2) 25%

iv. Wind Zone 4 (annual Mean Wind Power Density 301 - 400 w/m2) 30%

v. Wind Zone 5 (annual Mean Wind Power Density above 400 w/m2) 32%

(B) Small hydro plant 45%

(C) Solar PV power project 18%

(D) Solar thermal power project 23%

1.14. Regulations 36, 49, 68 and 78 of the RE Tariff Regulations 2013 specify the plant

load factor (PLF) for Biomass, Non-fossil fuel based cogeneration, Biomass Gasifier

and Biogas based renewable energy generating stations as given in the following

table which has been considered for determination of fixed charges component

of tariff.


JKSERC Page 6

Table 7: Plant Load factor for RE projects

Sl. No. Renewable energy projects PLF (%)

(A) Biomass based on rankine cycle technology project

i. During stabilization (first 6 months of operation) 60%

ii. During remaining period of first year (i.e. after stabilization) 70%

iii. Second year onwards 80%

(B)

Non-fossil fuel based cogeneration power project

(based on plant availability for 210 operating days i.e. 150

crushing days and 60 off-season days and load factor of 92%)

53%

(C) Biomass gasifier based power project 85%

(D) Biogas based power project 90%

Auxiliary consumption factor

1.15. TheRegulations 31, 37, 50, 64, 69 and 79 of the RE Tariff Regulations 2013

stipulate the auxiliary power consumption factor as under which has been considered

for determination of tariff of the RE projects.

Table 8: Auxiliary consumption factor for RE projects

Sl. No. Renewable energy projects Auxiliary consumption

factor (%)

(A) Small hydro plant 1%

(B) Biomass based on rankine cycle technology project 10%

(C) Non-fossil fuel based cogeneration power project 8.50%

(D) Solar thermal power project 10%

(E) Biomass gasifier based power project 10%

(F) Biogas based power project 12%

Determination of Capital cost

1.16. Regulation 12 of the RE Tariff Regulations 2013 stipulates that the norms for the

capital cost as specified in the technology specific chapter shall be inclusive of all

capital works like plant and machinery, civil works, erection and commissioning,

financing and interest during construction, and evacuation infrastructure up to inter-

connection point.

1.17. The Commission has specified the normative capital cost, applicable for the first year

of control period i.e. FY 2013-14, for various RE technologies viz. Wind Energy,

Small Hydro Power, Biomass Power, Non-Fossil Fuel based Cogeneration, Solar PV,

Solar Thermal, Biomass Gasifier and Biogas based power projects.


JKSERC Page 7

1.18. In order to determine the normative capital cost for FY 2014-15, the regulations

stipulate the indexation mechanism for Wind Energy, Small Hydro Power, Biomass

Power, Non-Fossil Fuel based Cogeneration, Biomass Gasifier and Biogas based

power projects. The indexation mechanism shall take into account adjustments in

capital cost with the changes in Wholesale Price Index of Steel and Wholesale Price

Index of Electrical Machinery as per formulation stipulated under the RE Tariff

Regulations 2013, which is reproduced below:

CC(n) = P&M(n)* (1+F1+F2+F3)

P&M(n) = P&M(0) * (1+d(n))

d(n) = [a*{(SI(n-1)/SI(0))– 1} + b

*{(EI(n-1)/EI(0)) – 1}]/(a+b)

Where,

CC (n) = Capital Cost for nth year i.e. in this case for FY 2014-15

P&M (n) = Plant and Machinery Cost for nth year

P&M (0) = Plant and Machinery Cost for base yeari.e. in this case for FY 2013-14

Note: P&M (0) is to be computed by dividing the base capital cost (for the first

year of the control period) by (1+F1+F2+F3). Factors F1, F2, F3 for each RE

technology has been specified separately, as summarized in following table.

d (n) = Capital Cost escalation factor for year (n) of Control Period

SI (n-1) = Average WPI Steel Index prevalent for calendar year (n-1) of the Control

Period (2013)

SI (0) = Average WPI Steel Index prevalent for calendar year (0) at the beginning of

the Control Period (2011)

EI (n-1) = Average WPI Electrical Machinery Index prevalent for calendar year (n-1)

of the Control Period

EI(0) = Average WPI Electrical Machinery Index prevalent for calendar year (0)

at thebeginning of the Control Period


JKSERC Page 8

a = Constant to be determined by Commission from time to time,(for weightage

to Steel Index)

b = Constant to be determined by Commission from time to time,(for weightage

to Electrical Machinery Index)

F1 = Factor for Land and Civil Works

F2 = Factor for Erection and Commissioning

F3 = Factor for IDC and Financing Cost

1.19. The default values of the factors for various RE technologies as stipulated under the

said Regulations, is summarized in the following table:

Table 9: Default value of constant parameters as per RE Tariff Regulations 2013

Constant

Parameters

Wind

energy

projects

Small

hydro

projects

Biomass based on rankine cycle technology,

non-fossil fuel based co-generation, Biomass

Gasifier and Biogas projects

a 0.6 0.6 0.7

b 0.4 0.4 0.3

F1 0.08 0.16 0.10

F2 0.07 0.10 0.09

F3 0.10 0.14 0.14

1.20. However, the Capital Cost norms for Solar PV and Solar Thermal Power Projects as

determined in the RE Tariff Regulations 2013 shall be reviewed on annual basis and

has been discussed in detail in following sub-section.

1.21. Technology specific capital cost of each type of RE projects is discussed here in

under:

(A) Capital cost for wind energy projects for FY 2014-15

1.22. Regulation 24 of the RE Tariff Regulations 2013 provides that the capital cost for

wind energy project shall include wind turbine generator including its auxiliaries, land

cost, site development charges and other civil works, transportation charges,

evacuation cost up to inter-connection point, financing charges and IDC.

1.23. The Commission under Regulation 24 (2) has specified the normative capital cost for

wind energy projects asRs. 575.00 Lakh/MW for FY 2013-14 which shall be linked to

the indexation mechanism specified under Regulation 25 of the above-mentioned

regulations. Thus, the normative capital cost of the Wind energy Projects shall be

Rs. 603.70 Lakh/MW for FY 2014-15. The detailed computations of the indexation

mechanism and determination of the capital cost for wind energy projects for FY

2014-15 thereof, has been enclosed as Appendix-1 of this Order.


JKSERC Page 9

(B) Capital cost for small hydro projects for FY 2014-15

1.24. Small Hydro Projects for the purpose of the RE Tariff Regulations 2013 cover those

projects which are located at the sites approved by the State Nodal Agencies/ State

Governments using new plant and machinery and with installed power plant capacity

lower than or equal to 25 MW at single location.

1.25. It should be noted that tariff for existing small hydro projects i.e. projects

commissioned prior to notification of RE Tariff Regulations 2013, using old plant and

machinery and with installed power plant capacity lower than or equal to 25 MW at

single location will be determined in accordance with provisions of JKSERC (Hydro

Generation Tariff) Regulations, 2011 and Notification No. JKSERC/13/2011 dated

April 20, 2011.

1.26. The Commission under Regulation 28 (1) of the RE Tariff Regulations 2013 has

specified the normative capital cost for small hydro projects for FY 2013-14 and

summarised in following table.

Table 10: Capital cost for small hydro projects for FY 2013-14

Project size Capital cost (Rs Lakhs/MW)

Below 5 MW 770

5 MW upto 25 MW 700

1.27. In line with the indexation mechanism specified under Regulation 29 of the RE Tariff

Regulations 2013, the normative capital cost for small hydro Projects for FY 2014-15

shall be as under:

Table 11: Capital cost for small hydro projects for FY 2014-15

Project size Capital cost (Rs Lakhs/MW)

Below 5 MW 808.439

5 MW upto 25 MW 734.945

1.28. The detailed computations of the indexation mechanism and determination of the

capital cost for small hydro projects for FY 2014-15 thereof, has been enclosed as

Appendix-2 of this Order.

(C) Capital cost for biomass projects based on Rankine cycle technology for

FY 2014-15

1.29. Biomass power project for the purpose of these Regulations covers the projects using

new plant and machinery based on Rankine cycle technology and using biomass fuel

sources, provided use of fossil fuel is restricted only up to 15% of total fuel

consumption on annual basis.


JKSERC Page 10

1.30. The Commission under Regulation 34 has specified the normative capital cost for the

biomass power projects based on Rankine cycle technology as Rs. 445 Lakh/MW for

FY 2013-14.

1.31. The normative capital cost for FY 2013-14 shall be linked to the indexation

mechanism specified under Regulation 35 of the RE Tariff Regulations 2013 to

determine the capital cost for FY 2014-15. Thus, the normative capital cost of

biomass power projects based on Rankine cycle technology shall be Rs. 466.811

Lakh/MW for FY 2014-15. The detailed calculations of the indexation mechanism

and determination of the capital cost for FY 2014-15 thereof, has been enclosed as

Appendix -3 of this Order

(D) Capital cost for non-fossil fuel based cogeneration projects for FY 2014-15

1.32. Non-fossil based cogeneration has been defined as the process in which more than one

form of energy (such as steam and electricity) are produced in a sequential manner by

use of biomass. As per Regulation 4(d) of RE Tariff Regulations 2013, for a project to

qualify as non-fossil based co-generation project must be using new plant and

machinery with topping cycle mode of operation which uses non-fossil fuel input for

power generation and also utilizes the thermal energy generated for useful heat

applications in other industrial activities simultaneously, and where sum of useful

power output and half useful thermal output is greater than 45% of plant’s energy

consumption during season.


Non-Fossil Fuel Based Cogeneration Projects as Rs. 420 Lakh/MW for FY 2013-14

which shall be linked to the indexation mechanism specified under Regulation 48 of

the RE Tariff Regulations 2013. Thus the normative capital cost of Non-Fossil Fuel

based Cogeneration power projects shall be Rs. 440.59 Lakh/MW for FY 2014-

15.The detailed computations of the indexation mechanism and determination of the

capital cost for FY 2014-15 thereof, has been enclosed as Appendix-4 of this Order

(E) Capital cost for Solar PV based projects for FY 2014-15

1.34. Solar Photo Voltaic (PV) power projects which directly convert solar energy into

electricity using the crystalline silicon or thin film technology or any other technology

as approved by the Ministry of New and Renewable Energy (MNRE) and are

connected to the grid, qualify for purpose of tariff determination under RE Tariff

Regulations 2013.


JKSERC Page 11

1.35. The Regulation 57 of the above-mentioned Regulations specifies the normative

capital cost for the Solar PV power projects as Rs 1000 Lakh/MW for the FY 2013-

14. However, the Commission notes that with the recent decline in capital cost for

Solar PV projects owing to regulatory and technological developments, the normative

capital cost specified in the RE Tariff Regulations 2013 is on the higher side. The

Regulation 5 of the above mentioned regulationsspecify that the benchmark capital

cost for Solar PV and Solar thermal projects may be reviewed annually by the

Commission.

1.36. The Central Electricity Regulatory Commission (CERC) has also taken similar

recourse while determining the benchmark capital cost for Solar PV Projects. The

CERC vide the CERC (RE Tariff Regulations), 2012 specified the benchmark capital

cost norm for Solar PV projects for FY 2012-13 as Rs. 1000 Lakh/MW. However,

owing to the decline in capital cost in the market for Solar PV technology, the CERC

vide Order dated 28th February 2013 in exercise of its powers under Regulation 5 of

the CERC (RE Tariff Regulations), 2012 determined the Benchmark Capital Cost

Norm for Solar PV power projects and Solar thermal power projects for FY 2013-14

as Rs 800 Lakh/MW and Rs 1200 Lakh/MW, respectively. Similarly, the CERC vide

its Order dated 15thMay 2014 had determined the benchmark capital cost for Solar

PV and Solar Thermal for FY 2014-15 as Rs. 691 Lakh/MW and Rs 1200 Lakh/MW,

respectively.

1.37. Based on above, and in exercise of its powers under Regulation 5 of the RE Tariff

Regulations 2013, the JKSERC determines the benchmark capital cost for Solar PV

power projects as Rs. 691 Lakh/MW for FY 2014-15.

(F) Capital cost for Solar Thermal based projects for FY 2014-15

1.38. In order to qualify for tariff determination under the RE Tariff Regulations 2013,

Solar Thermal Power Project shall be based on concentrated solar power technologies

with line focusing or point focusing as may be approved by the MNRE and which

uses direct sunlight to generate sufficient heat to operate a conventional power cycle

to generate electricity.


Solar Thermal power projects as Rs 1300 Lakh/MW for the FY 2013-14.

1.40. The CERC vide the CERC (RE Tariff Regulations), 2012 specified the benchmark

capital cost norm for Solar thermal projects for FY 2012-13 as Rs. 1300 Lakh/MW.

However, owing to the decline in capital cost in the market for Solar PV and thermal

technology, the CERC vide Order dated 28th February 2013 in exercise of its powers

under Regulation 5 of the CERC (RE Tariff Regulations), 2012 determined the

Benchmark Capital Cost Norm for Solar PV power projects and Solar thermal power

projects for FY 2013-14 as Rs 800 Lakh/MW and Rs 1200 Lakh/MW, respectively.

Similarly, the CERC vide its Order dated 15th May 2014 had determined the

benchmark capital cost for Solar PV and Solar Thermal for FY 2014-15 as Rs. 691

Lakh/MW and Rs 1200 Lakh/MW, respectively.


JKSERC Page 12

1.41. Based on above, and in exercise of its powers under Regulation 5 of the RE Tariff

Regulations 2013, the JKSERC determines the benchmark capital cost for Solar thermal

power projects as Rs. 1200 Lakh/MW for FY 2014-15.

(G) Capital cost for biomass gasifier based power projects for FY 2014-15

1.42. The Commission under Regulation 66 has specified the normative capital cost for

the Biomass Gasifier power projects based on Rankine cycle shall be Rs550.00

Lakh/MW for the FY 2013-14 and after taking into account of capital subsidy of

Rs150.00 Lakh/MW; net project cost shall beRs400.00 Lakh/MW for the

FY 2013-14. The normative capital cost specified for FY 2013-14 shall be linked to

the indexation mechanism specified under Regulation 67 of the RE Tariff

Regulations 2013 to determine normative capital cost for FY 2014-15.

1.43. Accordingly, the normative capital cost of Biomass gasifierpower projects shall be

Rs576.957 Lakh/MW for FY 2014-15. After taking into account capital subsidy of

Rs150.00 Lakh/MW, net project cost shall be Rs426.957 Lakh/MW for the

FY 2014-15. The detailed computations of the indexation mechanism and

determination of the capital cost for FY 2014-15 thereof, has been enclosed as


(H) Capital cost for biogas based power projects for FY 2014-15

1.44. In order to qualify for tariff determination under the RE Tariff Regulations 2013,

the project should use new plant and machinery and having grid connected system

that uses 100% Biogas fired engine, coupled with Biogas technology for co-

digesting agriculture residues, manure and other bio waste as may be approved by

the MNRE.

1.45. The Commission under Regulation 76 has specified the normative capital cost for

the Biogas based power projects shall be Rs 1100.00 Lakh/MW for the FY 2013-

14 and after taking into account the capital subsidy of Rs 300.00 Lakh/MW, net

project cost shall be Rs 800.00Lakh/MW for the FY 2013-14.

1.46. The normative capital cost specified for FY 2013-14 shall be linked to the

indexation mechanism specified under Regulation 77 of the RE Tariff

Regulations 2013 to determine normative capital cost for FY 2014-15.

1.47. Accordingly, the normative capital cost of Biogas based power projects shall be

Rs1153.915 Lakh/MW for FY 2014-15. After taking into account the capital

subsidy of Rs300.00 Lakh/MW, net project cost shall be Rs 853.915 Lakh/MW

for the FY 2014-15. The detailed computations of the indexation mechanism and

determination of the capital cost for FY 2014-15 thereof, has been enclosed as



JKSERC Page 13

1.48. The generic tariff is determined on the basis of normative capital cost without

considering capital subsidy except in case of small hydro, biomass gasifier and

biogas power projects. However in case capital subsidy is available, the capital

cost shall be considered after considering capital subsidy.

1.49. The normative capital cost for FY 2014-15 in respect of the renewable energy

power generating stations is summarized as under:

Table 12: NormativeCapital cost for RE projects for FY 2014-15

Sl. No. Renewable energy project Normative Capital cost

(Rs Lakhs/MW)

1. Wind energy projects 603.705

2. Small hydro projects

a) Below 5 MW 808.439

b) 5 MW upto 25 MW 734.945

3. Biomass power projects 466.811

4. Non-fossil fuel based cogeneration power

projects 440.586

5. Solar PV power projects 691.000

6. Solar thermal power projects 1200.00

7. Biomass gasifier power projects (after subsidy) 426.957

8. Biogas power projects (after subsidy) 853.915

1.50. Regulation 22 of the RE Tariff Regulations 2013 provides that the Commission

shall take into consideration any incentive or subsidy offered by the Central or State

Government for the renewable energy power plants while determining the tariff

under these Regulations. Accordingly, the Commission directs the developer

availing any such incentive or subsidy (other than accelerated depreciation benefits)

to submit a Petition in accordance with the Regulations 7 and Regulation 8 of the

RE Tariff Regulations 2013 for determination of project specific tariff.

1.51. The Commission clarifies that the generic tariffs approved in this Order shall not be

applicable to projects availing incentive or subsidy other than accelerated

depreciation benefits from the Central or State Government.

Determination of fixed cost components

Debt-Equity ratio

1.52. Sub-Regulation (1) of Regulation 13 of the RE Tariff Regulations 2013 provides

that the debt-equity ratio of 70:30 is to be considered for determination of generic

tariff based on suomotu petition. Accordingly, the debt and equity components of the

normative capital cost for determination of tariff for the RE projects have been

worked out as under:


JKSERC Page 14

Table 13: Debt-Equity component for RE projects for FY 2014-15

Sl. No. Renewable energy project Debt

(Rs Lakhs/MW)

Equity

(Rs Lakhs/MW)

1. Wind energy projects 422.593 181.111

2. Small hydro projects

a) Below 5 MW 565.908 242.532

b) 5 MW upto 25 MW 514.461 220.483

3. Biomass power projects 326.768 140.043

4. Non-fossil fuel based

cogeneration power projects 308.410 132.176

5. Solar PV power projects 483.700 207.300

6. Solar thermal power projects 840.00 360.00

7. Biomass gasifier power

projects 298.870 128.087

8. Biogas power projects 597.740 256.174

Return on equity


that the value base for the equity shall be 30% of the capital cost for generic tariff

determination. Sub-Regulation (2) of the said Regulation stipulates the normative

return on equity (ROE) shall be as under:

(a) 18% per annum for the first 10 years, and

(b) 22% per annum from the 11th year onwards.

Interest on loan capital


that the loan tenure is to be considered as 12 years for the purpose of determination

of generic tariff for RE projects. Sub-Regulation (2) of the said Regulation provides

for computation of the rate of interest on loan as under:

“(a) The loans arrived at in the manner indicated in the Regulation 13 shall be

considered as gross normative loan for calculation for interest on loan. The

normative loan outstanding as on April 1st of every year shall be worked out

by deducting the cumulative repayment up to March 31st of previous year from

the gross normative loan.

(b) For the purpose of computation of tariff, the normative interest rate shall be

considered as average Jammu and Kashmir Bank Base rate prevalent during

the first six months of the previous year plus 300 basis points.

(c) Notwithstanding any moratorium period availed by the generating company,

the repayment of loan shall be considered from the first year of commercial

operation of the project and shall be equal to the annual depreciation

allowed.”


JKSERC Page 15

1.55. The average Jammu and Kashmir Bank Base rate prevalent during the first six

months considered for determination of tariff is 10.25% applicable as on February

2013.

1.56. Accordingly, the computations of interest on loan carried out for determination of

tariff in respect of the RE projects treating the value base of loan as 70% of the

capital cost and the weighted average of J&K Bank Base rate prevalent during the

first six months of the (i.e. 10.25%) plus 300 basis points which works out to

13.25%.

Depreciation

1.57. Regulation 15 of the RE Tariff Regulations 2013 provides for computation of

depreciation in the following manner:

“(1) The value base for the purpose of depreciation shall be the Capital Cost of the

asset admitted by the Commission. The Salvage value of the asset shall be

considered as 10% and depreciation shall be allowed up to maximum of 90%

of the Capital Cost of the asset.

(2) Depreciation per annum shall be based on ‘Differential Depreciation

Approach' over loan period beyond loan tenure over useful life computed on

‘Straight Line Method’. The depreciation rate for the first 12 years of the

Tariff Period shall be 5.83% per annum and the remaining depreciation shall

be spread over the remaining useful life of the project from 13th year onwards.

(3) Depreciation shall be chargeable from the first year of commercial operation.

Provided that in case of commercial operation of the asset for part of the year,

depreciation shall be charged on pro rata basis”

1.58. In accordance with the above, the rate of depreciation for the first 12 years has

been considered as 5.83% and the rate of depreciation from the 13th

year onwards

has been spread over the balance useful life of the RE project as summarised in

following table.

Table 14: Applicable depreciation rates for RE projects

Details Wind Small

hydro Biomass

Non-fossil

fuel

Solar

PV

Solar

thermal

Biomass

gasifier Biogas

Useful life

(in years) 25 35 20 20 25 25 20 20

Depreciation

rate for first

12 years (%)

5.83 5.83 5.83 5.83 5.83 5.83 5.83 5.83

Depreciation

rate after first

12 years (%)

1.54 0.87 2.50 2.50 1.54 1.54 2.50 2.50


JKSERC Page 16

Interest on working capital

1.59. The working capital requirements for RE projects in accordance with Regulation 17

of the RE Tariff Regulations 2013 has been summarised in following table.

Table 15: Working capital requirement for RE projects

Particulars Wind/ Small hydro/

Solar PV/ Solar Thermal

Biomass/ Non-fossil fuel/

Biomass gasifier/ Biogas

Operation & maintenance (O&M) expenses 1 month 1 month

Receivables (equivalent to energy charges for

sale of electricity calculated on normative CUF) 2 months 2 months*

Maintenance spares 15% of O&M 15% of O&M

Fuel costs (equivalent to normative PLF) N.A. 4 months

Note: *In case of Biomass/ non-fossil fuel/ Biomass gasifier and biogas based projects receivables are estimated on

the basis fixed and variable chargesfor sale of electricity calculated on the target PLF.

1.60. The rate of interest for computation of interest on working capital is considered in

accordance with the sub-Regulation (3) of Regulation 17 of the RE Tariff Regulation

2013, which provides as under:

“Interest on Working Capital shall be at interest rate equivalent to the average Jammu

and Kashmir Bank Base Rate prevalent during the first six months of the previous year

plus 350 basis points”

1.61. The average Jammu and Kashmir Bank Base rate prevalent during the first six

months considered for determination of tariff is 10.25% applicable as on February

2013. Accordingly, rate of interest for computation of interest on working capital

requirements works out to 13.75% (i.e. 10.25% plus 350 basis points) for all RE

technologies.

Operation and maintenance (O&M) expenses

1.62. Regulation 18 of the RE Tariff Regulations 2013 provides for O&M expenses in respect

of RE projects as under:

“(1) ‘Operation and Maintenance or O&M expenses’ shall comprise repair and

maintenance (R&M), establishment including employee expenses and

administrative & general expenses.

(2) Operation and maintenance expenses shall be determined for the Tariff Period

based on normative O&M expenses specified by the Commission subsequently in

these Regulations for the first Year of Control Period.

(3) Normative O&M expenses allowed during first year of the Control Period (i.e.

FY 2013-14) under these Regulations shall be escalated at the rate of 5.72% per

annum over the Tariff Period.”


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1.63. The normative O&M expenses for various RE technologies specified under the

relevant provisions of the RE Tariff Regulations 2013 have been summarised as

under:

(a) Wind Energy: Regulation 27 of RE Tariff Regulations 2013 provides that

the normative O&M expenses for FY 2013-14 as Rs 9 lakh per MW and

shall be escalated at the rate of 5.72% per annum over the tariff period for

determination of the levellised tariff. Accordingly, the Commission has

considered O&M cost norm for wind energy as Rs 9.51 Lakh/MW for

FY 2014-15.

(b) Small Hydro:Regulation 32 of RE Tariff Regulations 2013 provided for

the normative O&M expenses for small hydro projects for the FY 2013-14

which shall be escalated at the rate of 5.72% per annum over the tariff

period for determination of the levellised tariff. The table below presents

the normative O&M Expenses considered by the Commission for small

hydro projects for FY 2013-14:

Table 16: O&M cost for small hydro projects for FY 2013-14

Project size O&M cost (Rs Lakhs/MW)

Below 5 MW 25

5 MW upto 25 MW 18

Based on escalation rate of 5.72% p.a.,the normative O&M Expenses

considered by Commission for small hydro projects for FY 2014-15:

Table 17: O&M cost for small hydro projects for FY 2014-15

Project size O&M cost (Rs Lakhs/MW)

Below 5 MW 26.43

5 MW upto 25 MW 19.03

(c) Biomass: Regulation 39 of RE Tariff Regulations 2013 provides that the

normative O& M expenses for biomass based projects for the FY 2013-14

shall be Rs 24 Lakh per MW and which shall be escalated at the rate of

5.72% per annum over the tariff period for determination of the levellised

tariff. Accordingly, the Commission has considered O&M cost norm for

biomass power as Rs25.37 Lakh/MW for FY 2014-15.

(d) Non-fossil fuel based co-generation: As per Regulation 55 of RE Tariff

Regulations 2013, the normative O&M Expenses for non-fossil fuel based

co-generation projects for the FY 2013-14 has been specified as Rs 16

Lakh per MW which shall be escalated at the rate of 5.72% per annum

over the tariff period for determination of the levellised tariff.

Accordingly, the Commission has considered O&M cost norm for non-

fossil fuel based co-generation as Rs16.92 Lakh/MW for FY 2014-15.


JKSERC Page 18

(e) Solar PV: Regulation 59 of RE Tariff Regulations 2013 provides that the

normative O&M expenses for solar PV projects for the FY 2013-14 shall

be Rs11 Lakh per MW which shall be escalated at the rate of 5.72% per

annum over the tariff period for determination of the levellised tariff.

Accordingly, O&M expense norm for solar PV power project has been

considered as Rs11.63 Lakh/MW for FY 2014-15.

(f) Solar Thermal: Regulation 63 of RE Tariff Regulations 2013 provides

that the normative O&M expenses for solar thermal projects for the

FY 2013-14 shall be Rs15 Lakh per MW which shall be escalated at the

rate of 5.72% per annum over the tariff period for determination of the

levellised tariff. Accordingly, O&M expense norm for solar thermalpower

project has been considered as Rs15.86 Lakh/MW for FY 2014-15.

(g) Biomass Gasifier: Regulation 71 of the RE Tariff Regulations 2013 specified

the normative O&M expenses for biomass gasifier based power projects shall

be Rs40 Lakh/MW for the FY 2013-14, which shall be escalated at the rate of



biomass gasifier based power plant as Rs42.29 Lakh/MW for FY 2014-15.

(h) Biogas: Regulation 80 of the RE Tariff Regulations 2013 specified the

normative O&M expenses for biogas based power projects shall be

Rs40 Lakh/MW for the FY 2013-14, which shall be escalated at the rate of



biogas based power plant as Rs42.29 Lakh/MW for FY 2014-15.

1.64. The normative O&M expenses have been worked out as specified above for

determination of generic levellisedtariff for the renewable energy generating stations.

Determination of fuel cost components

Station heat rate (SHR)

1.65. The Regulations 38 and 51 of the RE Tariff Regulations 2013 specify the SHR for

biomass and non-fossil fuel based co-generation projects as under:

Table 18: SHR for RE Projects

RE Project SHR (kCal/kWh)

Biomass power projects 4000

Non-fossil fuel based

cogeneration power projects 3600


JKSERC Page 19

Fuel mix

1.66. Sub-Regulation (1) of Regulation 40 and 72 of the RE Tariff Regulations 2013 stipulates

that the Biomass and Biomass gasifier based power generating stations are to be

designed in a way that it uses different types of non-fossil fuels available within the

vicinity of biomass power project such as crop residues, agro-industrial residues, forest

residues etc. and other biomass fuels as may be approved by the MNRE.

1.67. Further, the biomass and biomass gasifier based power generating companies are to

ensure fuel management plan to ensure adequate availability of fuel to meet the

respective project requirements.

1.68. In addition to above, Regulation 70 of the RE Tariff Regulations 2013 stipulates that the

normative specific fuel consumption shall be 1.25 kg per kWh for Biomass Gasifier

based power generating stations, while the Regulation 81 of the RE Tariff Regulations

2013 stipulates that the normative specific fuel consumption shall be 3 kg of substrate

mix per kWh for Biogas based power generating stations.

Use of fossil fuel

1.69. In case of biomass based projects, as per Regulation 41 of the RE Tariff Regulations

2013, the use of fossil fuel is to be limited to the extent of 15% of total fuel consumption

on annual basis and Regulation 42 of the RE Tariff Regulations provides the mechanism

for monitoring the use of fossil fuel for these projects.

Gross Calorific value

1.70. Regulation 43 of the RE Tariff Regulations 2013 provides that the gross calorific

value of biomass fuel used for determination of tariff shall be at 3300 kCal/kg.

1.71. Further, Regulation 52 of the RE Tariff Regulations 2013 provides that the gross

calorific value for bagasse to be considered in case of non-fossil fuel co-generation

projects is 2250 kCal/kg and for the use of biomass fuels other than bagasse, the

calorific value as specified above shall be applicable.

Fuel cost

A) Biomass power project

1.72. The Commission, in terms of Regulation 44 of the RE Tariff Regulations 2013, has

specified the biomass fuel price applicable during the period 2013-14 as Rs. 2500 per

tonne and has specified fuel price indexation mechanism, in case developer wishes to

opt, for the remaining years of the control period.


JKSERC Page 20

1.73. The data for price of diesel and WPI, as per regulations, latest figures for April, 2013

and April, 2012 corresponding to nth and (n-1)th year has been considered while

calculating the fuel price indexation for biomass and also non-fossil fuel based co-

generation power projects.

1.74. The detailed computations of the fuel price indexation mechanism and the

determination of the biomass fuel prices for FY 2014-15 thereof, has been enclosed

as Appendix-7 to this order. Accordingly, the biomass fuel price applicable for

FY 2014-15 is computed as Rs. 2773 per tonne.

B) Non-fossil fuel based cogeneration projects


specified the price of bagasse applicable during the period 2013-14 for non-fossil fuel

based cogeneration projects as Rs. 1600 per tonne and has specified fuel price

indexation mechanism, in case developer wishes to opt, for the remaining years of

the control period.


determination of the bagasse fuel prices for FY 2014-15 thereof, has been enclosed

as Appendix-8of this Order. Accordingly, the price of bagasse (for non-fossil fuel

based co-generation projects) applicable for FY 2014-15 shall beRs. 1775 per tonne.

C) Biomass gasifier projects


specified the biomass fuel price during first year of the Control Period i.e. FY 2013-

14 as Rs 2500 per tonne and has specified fuel price indexation mechanism for the

Biomass Gasifier project developer. Accordingly, the biomass fuel price for the

Biomass gasifier based power project applicable for FY 2014-15 shall be the same as

for the biomass based power project (Rankine cycle) i.e. Rs. 2773 per tonne. The

detailed computations of the fuel price indexation mechanism and the determination

of the biomass fuel prices for FY 2014-15 thereof, has been enclosed as Appendix-7

of this Order.

D) Biogas projects


specified the feed stock price during first year of the Control Period i.e. FY 2013-14

at Rs 990/MT(net of any cost recovery from digester effluent) and has specified fuel

price indexation mechanism for the Biogas project developer.


determination of the fuel prices for FY 2014-15 thereof, has been enclosed as

Appendix-9 of this Order. The price of fuel applicable for the biogas based power

plant for FY 2014-15 shall be at Rs 1098/MT(net of any cost recovery from digester

effluent).


JKSERC Page 21

1.80. In case of Biomass Power Projects, non-fossil fuel based co-generation projects,

Biomass Gasifier based power Projects and Biogas based power projects, variable

component of tariff is calculated based on the fuel cost for FY 2014-15. This variable

component will change each year based on whether a Renewable Energy Power

Project developer opts for fuel price indexation or escalation factor of 5% p.a. Hence,

while calculating the total applicable tariff for Biomass Power Projects, non-fossil

fuel based co-generation projects, Biomass Gasifier based power Projects and Biogas

based power projects, levellisation of only fixed component is considered and the

variable component for the first year of operation (i.e. 2014-15) is specified.

Subsidy or incentive by the Central / State Government

1.81. Regulation 22 of the RE Tariff Regulations 2013 provides as under:

“The Commission shall take into consideration any incentive or subsidy offered by

the Central or State Government, including accelerated depreciation benefit if

availed by the generating company, for the renewable energy power plants while

determining the tariff under these Regulations.

Provided that the following principles shall be considered for ascertaining income

tax benefit on account of accelerated depreciation, if availed, for the purpose of tariff

determination:

i) Assessment of benefit shall be based on normative capital cost, accelerated

depreciation rate as per relevant provisions under Income Tax Act and corporate

income tax rate.

ii) Capitalization of RE projects during second half of the fiscal year. Per unit benefit

shall be derived on levellised basis at discount factor equivalent to Post Tax

weighted average cost of capital.”

1.82. In terms of the above regulation, for the projects availing the benefit of accelerated

depreciation as per applicable Income tax rate @ 33.99% (30% IT rate+ 10%

surcharge +3% Education cess) has been considered. For the purpose of determining

net depreciation benefits, depreciation @ 5.28% as per straight line method (Book

depreciation as per Companies Act) has been compared with depreciation as per

Income Tax rate i.e. 80% of the written down value method (except for Wind energy

generator, as per Income-tax (Fourth Amendment Rules), 2012, depreciation is now

restricted to 15% on wind mills installed after 31-3-2012), Notification No. 15/2012

[F.No.149/21/2010-SO(TPL)] S.O.694(E), dated 30-3-2012). Moreover, additional

20% depreciation in the initial year is proposed to be extended to new assets acquired

by power generation companies vide amendment in the section 32, sub-section (1)

clause (iia) of the Income Tax Act.


JKSERC Page 22

1.83. Depreciation for the first year has been calculated at the rate of 50% of accelerated

depreciation of 80% and 50% of additional depreciation 20% (as project is

capitalized during the second half of the financial year as per proviso (ii) to

Regulation 22). Income tax benefits of accelerated depreciation and additional

depreciation, has been worked out as per normal tax rate on the net depreciation

benefit. Per unit levellised accelerated depreciation benefit has been computed

considering the post tax weighted average cost of capital as discount factor.

1.84. Regulation 22 of the RE Tariff Regulations 2013 provides that the Commission

shall take into consideration any incentive or subsidy offered by the Central or State

Government for the renewable energy power plants while determining the tariff

under these Regulations. Accordingly, the Commission directs the developer

availing any such incentive or subsidy (other than accelerated depreciation benefits)

to submit a Petition in accordance with the Regulations 7 and Regulation 8 of the

RE Tariff Regulations 2013 for determination of project specific tariff.

1.85. The Commission clarifies that the generic tariffs approved in this Order shall not be

applicable to projects availing incentive or subsidy other than accelerated

depreciation benefits from the Central or State Government.

1.86. In the light of the discussion made in the preceding paragraphs, the generic tariffs of

the following RE projects for the financial year 2014-15 have been summarisedin the

following tables.

Table 19: Generic Levellised tariff for RE technologies without fuel component for FY 2014-15

Particulars

Levellised Total

Tariff

(FY 2014-15)

Benefit of

Accelerated

Depreciation (if

availed)

Net Levellised Tariff

(upon adjusting for

Accelerated

Depreciation

benefit) (if availed)

(Rs/kWh) (Rs/kWh) (Rs/kWh)

WIND ENERGY

Wind Zone -1 (CUF 20%) 6.16 0.36 5.80

Wind Zone -2 (CUF 22%) 5.60 0.33 5.27

Wind Zone -3 (CUF 25%) 4.93 0.29 4.64

Wind Zone -4 (CUF 30%) 4.11 0.24 3.87

Wind Zone -5 (CUF 32%) 3.85 0.23 3.62

SMALL HYDRO

Capacity below 5 MW 4.30 0.39 3.91

Capacity 5 MW upto 25 MW 3.67 0.35 3.32

SOLAR PV & THERMAL

Solar PV 7.50 0.83 6.67

Solar Thermal 11.55 1.32 10.23


JKSERC Page 23

Table 20: Generic tariff for RE technologies with fuel component for FY 2014-15

Particulars

Levellised

fixed cost

Variable cost

(FY 2014-15)

Applicable

Tariff

(FY 2014-

15)

Benefit of

Accelerated

Depreciation

(if availed)

Net Levellised

Tariff

(upon adjusting

for

Accelerated

Depreciation

benefit,

if availed)

(Rs/kWh) (Rs/kWh) (Rs/kWh) (Rs/kWh) (Rs/kWh)

BIOMASS 2.11 3.73 5.84 0.16 5.68

NON FOSSIL FUEL

BASED COGENERATION 2.48 3.10 5.58 0.22 5.36

BIOMASS GASIFIER 2.34 4.93 7.27 0.14 7.13

BIOGAS 3.04 2.00 5.04 0.35 4.69

1.87. The detailed computations for the generic tariff for various RE technologies have

been enclosed to this Order as per the details given hereunder:

Sl. No. Renewable Energy Projects Annexures

1. Wind Power Projects

Wind Zone – 1 Annexure 1A

Wind Zone – 2 Annexure 1B

Wind Zone – 3 Annexure 1C

Wind Zone – 4 Annexure 1D

Wind Zone - 5 Annexure 1E

2. Small Hydro Power Projects

Capacity below 5 MW Annexure 2A

Capacity 5 MW upto 25 MW Annexure 2B

3. Biomass Power Projects Annexure 3

4. Non-fossil fuel based cogeneration Power Projects Annexure 4

5. Solar PV Power Projects Annexure 5

6. Solar Thermal Power Projects Annexure 6

7. Biomass GasifierPower Projects Annexure 7

8. Biogas Power Projects Annexure 8


JKSERC Page 24

Appendix-1

Capital cost for wind energy project (FY 2014-15)

Indexation Formulation:

CC( n ) = P&M (n) * [1 + F1 + F2 + F3]

P&M(n) = P&M(0)*(1+ d (n))

P&M(0) = CC (0) / [1 + F1 + F2 + F3]

d (n) = (a * (SI(n-1)/SI(0))-1) +b* (EI(n-1)/EI(0))-1)) / (a+b)

Variable Description Value

a Weightage for Steel Index 0.60

b Weightage for Electrical Machinery Index 0.40

F1 Factor for Land and Civil Work 0.08

F2 Factor for Erection and Commissioning 0.07

F3 Factor for IDC and Financing 0.10

Month ElectricalMachinery Steel

2013 2011 2013 2011

January 133.900 125.100 126.200 118.600

February 133.800 125.100 126.200 113.000

March 134.100 126.400 126.200 113.000

April 134.500 127.200 126.200 113.000

May 135.500 127.600 126.200 113.000

June 135.600 128.000 126.200 119.600

July 135.600 128.700 126.200 126.200

August 135.700 129.200 126.200 126.200

September 136.300 130.900 126.200 126.200

October 137.100 130.600 126.200 126.200

November 137.000 130.800 126.200 126.200

December 136.800 131.000 126.200 126.200

Average 135.492 128.383 126.200 120.617

Source: Office of Economic Advisor, Ministry of Commerce and Industry (www.eaindustry.nic.in)

Description Parameters Value

Capital Cost for the Base Year i.e. FY 2013-14 (Rs Lakh/MW) CC(0) 575.000

Plant & Machinery Cost for the Base Year i.e. for FY 2013-14 (Rs Lakh/MW) P&M(0) 460.000

Capital Cost escalation Factor (%) d(n) (%) 4.992%

Plant & Machinery Cost for the nth Year i.e. FY 2014-15 (Rs Lakh/MW) P&M(n) 482.964

Capital Cost for the nth Year i.e. FY 2014-15 (Rs Lakh/MW) CC(n) 603.704

http://www.eaindustry.nic.in/


JKSERC Page 25

Appendix-2

Capital cost for small hydro project (FY 2014-15)


CC( n ) = P&M (n) * [1 + F1 + F2 + F3]

P&M(n) = P&M(0)*(1+ d (n))

P&M(0) = CC (0) / [1 + F1 + F2 + F3]









2013 2011 2013 2011

January 133.900 125.100 126.200 118.600

February 133.800 125.100 126.200 113.000

March 134.100 126.400 126.200 113.000

April 134.500 127.200 126.200 113.000

May 135.500 127.600 126.200 113.000

June 135.600 128.000 126.200 119.600

July 135.600 128.700 126.200 126.200

August 135.700 129.200 126.200 126.200

September 136.300 130.900 126.200 126.200

October 137.100 130.600 126.200 126.200

November 137.000 130.800 126.200 126.200

December 136.800 131.000 126.200 126.200

Average 135.492 128.383 126.200 120.617


Description Parameters SHP

(<5MW)

SHP

(5-25 MW)

Capital Cost for the Base Year i.e. FY 2013-14 (Rs Lakh/MW) CC(0) 770.000 700.000

P&M Cost for the Base Year i.e. for FY 2013-14 (Rs Lakh/MW) P&M(0) 550.000 500.000

Capital Cost escalation Factor (%) d(n) (%) 4.992% 4.992%

P&M Cost for the nth Year i.e. FY 2014-15 (Rs Lakh/MW) P&M(n) 577.457 524.961

Capital Cost for the nth Year i.e. FY 2014-15 (Rs Lakh/MW) CC(n) 808.439 734.945



JKSERC Page 26

Appendix-3

Capital cost for biomassbased project (FY 2014-15)


CC( n ) = P&M (n) * [1 + F1 + F2 + F3]

P&M(n) = P&M(0)*(1+ d (n))

P&M(0) = CC (0) / [1 + F1 + F2 + F3]









2013 2011 2013 2011

January 133.900 125.100 126.200 118.600

February 133.800 125.100 126.200 113.000

March 134.100 126.400 126.200 113.000

April 134.500 127.200 126.200 113.000

May 135.500 127.600 126.200 113.000

June 135.600 128.000 126.200 119.600

July 135.600 128.700 126.200 126.200

August 135.700 129.200 126.200 126.200

September 136.300 130.900 126.200 126.200

October 137.100 130.600 126.200 126.200

November 137.000 130.800 126.200 126.200

December 136.800 131.000 126.200 126.200

Average 135.492 128.383 126.200 120.617










JKSERC Page 27

Appendix-4

Capital cost for non-fossil fuel cogeneration projects (FY 2014-15)


CC( n ) = P&M (n) * [1 + F1 + F2 + F3]

P&M(n) = P&M(0)*(1+ d (n))

P&M(0) = CC (0) / [1 + F1 + F2 + F3]









2013 2011 2013 2011

January 133.900 125.100 126.200 118.600

February 133.800 125.100 126.200 113.000

March 134.100 126.400 126.200 113.000

April 134.500 127.200 126.200 113.000

May 135.500 127.600 126.200 113.000

June 135.600 128.000 126.200 119.600

July 135.600 128.700 126.200 126.200

August 135.700 129.200 126.200 126.200

September 136.300 130.900 126.200 126.200

October 137.100 130.600 126.200 126.200

November 137.000 130.800 126.200 126.200

December 136.800 131.000 126.200 126.200

Average 135.492 128.383 126.200 120.617










JKSERC Page 28

Appendix-5

Capital cost for biomass gasifier based power projects (FY 2014-15)


CC( n ) = P&M (n) * [1 + F1 + F2 + F3]

P&M(n) = P&M(0)*(1+ d (n))

P&M(0) = CC (0) / [1 + F1 + F2 + F3]









2013 2011 2013 2011

January 133.900 125.100 126.200 118.600

February 133.800 125.100 126.200 113.000

March 134.100 126.400 126.200 113.000

April 134.500 127.200 126.200 113.000

May 135.500 127.600 126.200 113.000

June 135.600 128.000 126.200 119.600

July 135.600 128.700 126.200 126.200

August 135.700 129.200 126.200 126.200

September 136.300 130.900 126.200 126.200

October 137.100 130.600 126.200 126.200

November 137.000 130.800 126.200 126.200

December 136.800 131.000 126.200 126.200

Average 135.492 128.383 126.200 120.617










JKSERC Page 29

Appendix-6

Capital cost for biogas based power projects (FY 2014-15)


CC( n ) = P&M (n) * [1 + F1 + F2 + F3]

P&M(n) = P&M(0)*(1+ d (n))

P&M(0) = CC (0) / [1 + F1 + F2 + F3]









2013 2011 2013 2011

January 133.900 125.100 126.200 118.600

February 133.800 125.100 126.200 113.000

March 134.100 126.400 126.200 113.000

April 134.500 127.200 126.200 113.000

May 135.500 127.600 126.200 113.000

June 135.600 128.000 126.200 119.600

July 135.600 128.700 126.200 126.200

August 135.700 129.200 126.200 126.200

September 136.300 130.900 126.200 126.200

October 137.100 130.600 126.200 126.200

November 137.000 130.800 126.200 126.200

December 136.800 131.000 126.200 126.200

Average 135.492 128.383 126.200 120.617










JKSERC Page 30

Appendix-7

Biomass fuel price (FY 2014-15)

(As per fuel price Index Mechanism outlined under Regulation 45 & 74

and the availability of required information)

Fuel Price Indexation Formulation:

P(n) = P(n-1)*{a

*(WPI(n)/WPI(n-1)+b

*(1+IRC(n-1)+c

*(Pd(n)/Pd(n-1))}

Description Parameter Value

Wholesale Price Index for all commodities for month of April 2012 * WPI n-1 163.500

Wholesale Price Index for all commodities for month of April 2013 * WPI n 171.300

Average Annual Inflation Rate for Indexed Energy Charge Component

for (n-1) i.e. FY 2013-14 ** IRC n-1 9.81%

Price/Ton for HSD for (n-1)th (2012) year * Pd n-1 175.242

Price/Ton for HSD for (n)th (2013) year* Pd n 210.908

Factor Representing Fuel Handling Cost a 0.20

Factor Representing Fuel Cost b 0.60

Factor Representing Transportation Cost c 0.20

Biomass fuel price for FY 2013-14 (Rs/MT) P n-1 2500

Biomass Fuel Price for FY 2014-15 (Rs/MT) P n 2773

Sources: * Office of Economic Advisor, Ministry of Commerce and Industry (www.eaindustry.nic.in);

**CERC Order for determination of Annual Inflation Rate for Indexed Energy charge component for

‘payment purpose’ of Competitive bidding guidelines for FY 2013-14 (www.cercind.gov.in)

Notes:

1. The Calculation of WPI (n) and WPI (n-1) is based on the figures available on April

2013 and April 2012 respectively.

2. The Calculation of Pd (n) is based on the weighted average of the WPI (Price of HSD)

figures available for the months from January 2013 to December 2013 and the

Calculation of Pd (n-1) is based on the weighted average of the WPI (Price of HSD)

figures available for the months from January 2012 to December 2012, as shown

below.

Month 2013 2012

Jan 198.800 167.800

Feb 202.700 167.800

Mar 201.700 167.800

Apr 202.300 167.800

May 203.400 167.800

Jun 207.000 167.800


http://www.cercind.gov.in/


JKSERC Page 31

Jul 212.000 167.800

Aug 215.400 168.600

Sep 219.800 182.800

Oct 220.500 192.300

Nov 222.400 192.300

Dec 225.000 192.300

Average Pd (n): 210.908 Pd (n-1): 175.242


JKSERC Page 32

Appendix-8

Bagasse price (FY 2014-15)

(As per fuel price Index Mechanism outlined under Regulation 54



P(n) = P(n-1)*{a

*(WPI(n)/WPI(n-1)+b

*(1+IRC(n-1)+c

*(Pd(n)/Pd(n-1))}





for (n-1) i.e. FY 2013-14 ** IRC n-1 9.81%











Notes:







below.

Month 2013 2012

Jan 198.800 167.800

Feb 202.700 167.800

Mar 201.700 167.800

Apr 202.300 167.800

May 203.400 167.800

Jun 207.000 167.800




JKSERC Page 33

Jul 212.000 167.800

Aug 215.400 168.600

Sep 219.800 182.800

Oct 220.500 192.300

Nov 222.400 192.300

Dec 225.000 192.300

Average Pd (n): 210.908 Pd (n-1): 175.242


JKSERC Page 34

Appendix-9

Biogas price (FY 2014-15)

(As per fuel price Index Mechanism outlined under Regulation 83



P(n) = P(n-1)*{a

*(WPI(n)/WPI(n-1)+b

*(1+IRC(n-1)+c

*(Pd(n)/Pd(n-1))}





for (n-1) i.e. FY 2013-14 ** IRC n-1 9.81%











Notes:







below.

Month 2013 2012

Jan 198.800 167.800

Feb 202.700 167.800

Mar 201.700 167.800

Apr 202.300 167.800

May 203.400 167.800

Jun 207.000 167.800




JKSERC Page 35

Month 2013 2012

Jul 212.000 167.800

Aug 215.400 168.600

Sep 219.800 182.800

Oct 220.500 192.300

Nov 222.400 192.300

Dec 225.000 192.300

Average Pd (n): 210.908 Pd (n-1): 175.242


JKSERC Page 36



JKSERC Page 37

Annexures


JKSERC Page 38


Sl. No. Renewable Energy Projects Annexures

1 Wind Power ProjectsWind Zone – 1 Annexure 1A

Wind Zone – 2 Annexure 1B

Wind Zone – 3 Annexure 1C

Wind Zone – 4 Annexure 1D

Wind Zone - 5 Annexure 1E

2 Small Hydro Power ProjectsCapacity below 5 MW Annexure 2A

Capacity 5 MW upto 25 MW Annexure 2B

3 Biomass Power Projects Annexure 3

4 Non-fossil Fuel Based Cogeneration Power Projects Annexure 4

5 Solar PV Power Projects Annexure 5

6 Solar Thermal Power Projects Annexure 6

7 Biomass Gasifier Power Projects Annexure 7

8 Biogas Power Projects Annexure 8

INDEX

JKSERC Page 39

Annexure 1AWind Power Projects (Wind Zone 1)Assumptions

S. No. Assumption Head Sub-Head Sub-Head (2) Unit Amount

1 Power GenerationCapacity

Installed Power Generation Capacity MW 1Capacity Utilization Factor % 20%Auxiliary consumption % 0.00%Commercial operation date mm/yyyy Apr-14Useful Life Years 25

2 Project Cost Base Year (FY 2013-14) Rs Lacs 575Capital Cost/MW Power Plant Cost - FY 2014-15 Rs Lacs 603.70

Capital subsidy (if any) Rs Lacs 0

Net capital cost Rs Lacs 604

3 Sources of FundTariff Period Years 13

Debt: EquityDebt % 70%Equity % 30%Total Debt Amount Rs Lacs 422.593Total Equity Amout Rs Lacs 181.111

Debt ComponentLoan Amount Rs Lacs 423Moratorium Period years 0Repayment Period(incld Moratorium) years 12Interest Rate % 13.25%

Equity ComponentEquity amount Rs Lacs 181Return on Equity for first 10 years % p.a 18.0%RoE Period Year 10Return on Equity 11th year onwards % p.a 22.0%Weighted average of ROE % 20.4%Discount Rate (Equiv. to WACC) % 10.92%

4 Financial AssumptionsFiscal Assumptions

Income Tax % 33.99%MAT Rate (for first 10 years) % 20.01%80 IA benefits Yes/No Yes

DepreciationDepreciation Rate for first 12 years % 5.83%Depreciation Rate 13th year onwards % 1.54%Years for 5.83% rate Years 12Salvage value % 10%

5 Working CapitalFor Fixed ChargesO&M Charges Months 1Maintenance Spare (% of O&M exepenses) % 15%Receivables for Debtors Months 2on energy chargesInterest On Working Capital % 13.75%

6 Operation & MaintenanceBase Year - FY 2013-14 Rs Lakh 9.00FY 2014-15 9.51Total O & M Expenses Escalation % 5.72%

7 Incentives (if any)GBI Rs Lakh p.a. 0.00Period for GBI Years 0.00

JKSERC Page 40

Determination of Tariff Component

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 24 25Installed 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 1Gross/Net Generation MU 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75

Tariff Components

(Fixed Charge) 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 24 25O&M Expenses Rs Lakh 9.51 10.06 10.63 11.24 11.89 12.57 13.28 14.04 14.85 15.70 16.59 17.54 18.55 19.61 20.73 21.92 23.17 24.49 25.90 27.38 28.94 30.60 32.35 34.20 36.16Depreciation Rs Lakh 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29Interest on term loan Rs Lakh 53.66 48.99 44.33 39.66 35.00 30.33 25.66 21.00 16.33 11.67 7.00 2.33 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Interest on working Capital Rs Lakh 3.38 3.31 3.23 3.15 3.08 3.01 2.94 2.87 2.81 2.75 2.86 2.80 2.20 2.26 2.32 2.39 2.46 2.53 2.61 2.69 2.78 2.87 2.97 3.08 3.19Return on Equity Rs Lakh 32.60 32.60 32.60 32.60 32.60 32.60 32.60 32.60 32.60 32.60 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84Total Fixed Cost Rs Lakh 134.38 130.18 126.01 121.87 117.78 113.72 109.70 105.73 101.80 97.93 101.51 97.74 69.88 71.00 72.18 73.43 74.76 76.16 77.64 79.20 80.86 82.61 84.45 86.41 88.48

Levallised tariff corresponding to Useful lifePer Unit Cost of Generation Unit Levellised 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25O&M expn Rs/kWh 0.86 0.54 0.57 0.61 0.64 0.68 0.72 0.76 0.80 0.85 0.90 0.95 1.00 1.06 1.12 1.18 1.25 1.32 1.40 1.48 1.56 1.65 1.75 1.85 1.95 2.06Depreciation Rs/kWh 1.67 2.01 2.01 2.01 2.01 2.01 2.01 2.01 2.01 2.01 2.01 2.01 2.01 0.53 0.53 0.53 0.53 0.53 0.53 0.53 0.53 0.53 0.53 0.53 0.53 0.53Int. on term loan Rs/kWh 1.48 3.06 2.80 2.53 2.26 2.00 1.73 1.46 1.20 0.93 0.67 0.40 0.13 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Int. on working capital Rs/kWh 0.17 0.19 0.19 0.18 0.18 0.18 0.17 0.17 0.16 0.16 0.16 0.16 0.16 0.13 0.13 0.13 0.14 0.14 0.14 0.15 0.15 0.16 0.16 0.17 0.18 0.18RoE Rs/kWh 1.99 1.86 1.86 1.86 1.86 1.86 1.86 1.86 1.86 1.86 1.86 2.27 2.27 2.27 2.27 2.27 2.27 2.27 2.27 2.27 2.27 2.27 2.27 2.27 2.27 2.27Total COG per unit Rs/kWh 6.16 7.67 7.43 7.19 6.96 6.72 6.49 6.26 6.03 5.81 5.59 5.79 5.58 3.99 4.05 4.12 4.19 4.27 4.35 4.43 4.52 4.62 4.71 4.82 4.93 5.05

LevellisedDiscount Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140 0.126 0.113 0.102 0.092 0.083Levellised Tariff 107.95 Rs LakhsLevellised Tariff 6.16 Rs/Unit

JKSERC Page41

Accelerated DepreciationDepreciation amount 90%Book Depreciation rate 5.28%Tax Depreciation rate 15%Additional Depreciation 20.00%Income Tax (Normal Rates) 33.990%Capital Cost 603.705

Years -----------------> Unit 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Book 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% 0.00% 0.00%Book Depreciation Rs Lakh 15.94 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 17.39 0.00 0.00

Accelerated DepreciationOpening % 100.00% 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91%Allowed during the year % 17.50% 20.63% 9.28% 7.89% 6.71% 5.70% 4.84% 4.12% 3.50% 2.98% 2.53% 2.15% 1.83% 1.55% 1.32% 1.12% 0.95% 0.81% 0.69% 0.59%Closing % 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91% 3.32%Accelerated Deprn. Rs Lakh 105.65 124.51 56.03 47.63 40.48 34.41 29.25 24.86 21.13 17.96 15.27 12.98 11.03 9.38 7.97 6.77 5.76 4.89 4.16 3.54

Net Depreciation Benefit Rs Lakh 89.71 92.64 24.16 15.75 8.61 2.53 -2.63 -7.01 -10.74 -13.91 -16.61 -18.90 -20.84 -22.50 -23.91 -25.10 -26.12 -12.49 4.16 3.54Tax Benefit Rs Lakh 30.49 31.49 8.21 5.35 2.93 0.86 -0.89 -2.38 -3.65 -4.73 -5.64 -6.42 -7.09 -7.65 -8.13 -8.53 -8.88 -4.25 1.41 1.20Energy generation MU 0.88 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1.75Per unit benefit Rs/Unit 3.48 1.80 0.47 0.31 0.17 0.05 -0.05 -0.14 -0.21 -0.27 -0.32 -0.37 -0.40 -0.44 -0.46 -0.49 -0.51 -0.24 0.08 0.07Discounting Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140

0.95 0.86 0.77 0.70 0.63 0.57 0.51 0.46 0.41 0.37 0.34 0.30 0.27 0.25 0.22 0.20 0.18 0.16 0.15Tax Benefit Levellised 5.97 Rs LakhElectricity Generation (Levellised) 1.65 MULevellised benefit 0.36 Rs/Unit

JKSERC Page 42

Annexure 1BWind Power Projects (Wind Zone 2)

Assumptions



Installed Power Generation Capacity MW 1

Capacity Utilization Factor % 22%

Auxiliary consumption % 0.00%

Useful Life Years 25

2 Project Cost Base Year (FY 2013-14) Rs Lacs 575

Capital Cost/MW Power Plant Cost - FY 2014-15 Rs Lacs 603.70




Debt: Equity

Debt % 70%

Equity % 30%

Total Debt Amount Rs Lacs 422.593

Total Equity Amout Rs Lacs 181.111

Debt Component

Loan Amount Rs Lacs 423

Moratorium Period years 0

Repayment Period(incld Moratorium) years 12

Interest Rate % 13.25%

Equity Component

Equity amount Rs Lacs 181

Return on Equity for first 10 years % p.a 18.0%

RoE Period Year 10

Return on Equity 11th year onwards % p.a 22.0%

Weighted average of ROE % 20.4%

Discount Rate (Equiv. to WACC) % 10.92%


Income Tax % 33.99%

MAT Rate (for first 10 years) % 20.01%

80 IA benefits Yes/No Yes

Depreciation

Depreciation Rate for first 12 years % 5.83%

Depreciation Rate 13th year onwards % 1.54%

Years for 5.83% rate Years 12

Salvage value % 10%

5 Working CapitalFor Fixed Charges

O&M Charges Months 1

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

Receivables for Debtors Months 2

on energy charges

Interest On Working Capital % 13.75%

6 Operation & MaintenanceBase Year - FY 2013-14 Rs Lakh 9.00

FY 2014-15 9.51

Total O & M Expenses Escalation % 5.72%

7 Incentives (if any)GBI Rs Lakh p.a. 0.00

Period for GBI Years 0.00

JKSERC Page 43



Tariff Components(Fixed Charge) 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 24 25O&M Expenses Rs Lakh 9.51 10.06 10.63 11.24 11.89 12.57 13.28 14.04 14.85 15.70 16.59 17.54 18.55 19.61 20.73 21.92 23.17 24.49 25.90 27.38 28.94 30.60 32.35 34.20 36.16Depreciation Rs Lakh 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29Interest on term loan Rs Lakh 53.66 48.99 44.33 39.66 35.00 30.33 25.66 21.00 16.33 11.67 7.00 2.33 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Interest on working Capital Rs Lakh 3.38 3.31 3.23 3.15 3.08 3.01 2.94 2.87 2.81 2.75 2.86 2.80 2.20 2.26 2.32 2.39 2.46 2.53 2.61 2.69 2.78 2.87 2.97 3.08 3.19Return on Equity Rs Lakh 32.60 32.60 32.60 32.60 32.60 32.60 32.60 32.60 32.60 32.60 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84Total Fixed Cost Rs Lakh 134.38 130.18 126.01 121.87 117.78 113.72 109.70 105.73 101.80 97.93 101.51 97.74 69.88 71.00 72.18 73.43 74.76 76.16 77.64 79.20 80.86 82.61 84.45 86.41 88.48


LevellisedDiscount Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140 0.126 0.113 0.102 0.092 0.083Levellised Tariff 5.60 Rs/Unit

JKSERC Page 44

Accelerated Depreciation

Depreciation amount 90%

Book Depreciation rate 5.28%

Tax Depreciation rate 15%

Additional Depreciation 20.00%

Income Tax (Normal Rates) 33.990%

Capital Cost 603.705

Years -----------------> Unit 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Book 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% 0.00% 0.00%

Book Depreciation Rs Lakh 15.94 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 31.88 17.39 0.00 0.00


Opening % 100.00% 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91%

Allowed during the year % 17.50% 20.63% 9.28% 7.89% 6.71% 5.70% 4.84% 4.12% 3.50% 2.98% 2.53% 2.15% 1.83% 1.55% 1.32% 1.12% 0.95% 0.81% 0.69% 0.59%

Closing % 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91% 3.32%

Accelerated Deprn. Rs Lakh 105.65 124.51 56.03 47.63 40.48 34.41 29.25 24.86 21.13 17.96 15.27 12.98 11.03 9.38 7.97 6.77 5.76 4.89 4.16 3.54

Net Depreciation Benefit Rs Lakh 89.71 92.64 24.16 15.75 8.61 2.53 -2.63 -7.01 -10.74 -13.91 -16.61 -18.90 -20.84 -22.50 -23.91 -25.10 -26.12 -12.49 4.16 3.54

Tax Benefit Rs Lakh 30.49 31.49 8.21 5.35 2.93 0.86 -0.89 -2.38 -3.65 -4.73 -5.64 -6.42 -7.09 -7.65 -8.13 -8.53 -8.88 -4.25 1.41 1.20

Energy generation MU 0.96 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93 1.93

Per unit benefit Rs/Unit 3.16 1.63 0.43 0.28 0.15 0.04 -0.05 -0.12 -0.19 -0.25 -0.29 -0.33 -0.37 -0.40 -0.42 -0.44 -0.46 -0.22 0.07 0.06

Discounting Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140

Tax Benefit Levellised 5.97 Rs Lakh

Electricity Generation (Levellised) 1.82 MU

Levellised benefit 0.33 Rs/Unit

JKSERC Page 45

Annexure 1CWind Power Projects (Wind Zone 3)

Assumptions



Installed Power Generation Capacity MW 1Capacity Utilization Factor % 25%Auxiliary consumption % 0.00%








Equity ComponentEquity amount Rs Lacs 181Return on Equity for first 10 years % p.a 18.0%RoE Period Year 10Return on Equity 11th year onwards % p.a 22.0%Weighted average of ROE % 20.4%




DepreciationDepreciation Rate for first 12 years % 5.83%Depreciation Rate 13th year onwards % 1.54%Years for 5.83% rate Years 12

Salvage value % 10%





JKSERC Page 46



Tariff Components




JKSERC Page 47











Opening % 100.00% 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91%


Closing % 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91% 3.32%







0.95 0.86 0.77 0.70 0.63 0.57 0.51 0.46 0.41 0.37 0.34 0.30 0.27 0.25 0.22 0.20 0.18 0.16 0.15




JKSERC Page 48

Annexure 1DWind Power Projects (Wind Zone 4)

Assumptions
















Salvage value % 10%





JKSERC Page 49



Tariff Components(Fixed Charge) 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 24 25O&M Expenses Rs Lakh 9.51 10.06 10.63 11.24 11.89 12.57 13.28 14.04 14.85 15.70 16.59 17.54 18.55 19.61 20.73 21.92 23.17 24.49 25.90 27.38 28.94 30.60 32.35 34.20 36.16Depreciation Rs Lakh 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 35.22 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29 9.29Interest on term loan Rs Lakh 53.66 48.99 44.33 39.66 35.00 30.33 25.66 21.00 16.33 11.67 7.00 2.33 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Interest on working Capital Rs Lakh 3.38 3.31 3.23 3.15 3.08 3.01 2.94 2.87 2.81 2.75 2.86 2.80 2.20 2.26 2.32 2.39 2.46 2.53 2.61 2.69 2.78 2.87 2.97 3.08 3.19Return on Equity Rs Lakh 32.60 32.60 32.60 32.60 32.60 32.60 32.60 32.60 32.60 32.60 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84 39.84Total Fixed Cost Rs Lakh 134.38 130.18 126.01 121.87 117.78 113.72 109.70 105.73 101.80 97.93 101.51 97.74 69.88 71.00 72.18 73.43 74.76 76.16 77.64 79.20 80.86 82.61 84.45 86.41 88.48



JKSERC Page 50











Opening % 100.00% 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91%


Closing % 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91% 3.32%







0.95 0.86 0.77 0.70 0.63 0.57 0.51 0.46 0.41 0.37 0.34 0.30 0.27 0.25 0.22 0.20 0.18 0.16 0.15




JKSERC Page 51

Annexure 1EWind Power Projects (Wind Zone 5)

Assumptions












Debt: Equity

Debt % 70%

Equity % 30%



Debt Component





Equity Component



RoE Period Year 10





Income Tax % 33.99%



Depreciation




Salvage value % 10%





on energy charges



FY 2014-15 9.51




JKSERC Page 52



Tariff Components




JKSERC Page 53



Accelerated DepreciationOpening % 100.00% 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91%Allowed during the year % 17.50% 20.63% 9.28% 7.89% 6.71% 5.70% 4.84% 4.12% 3.50% 2.98% 2.53% 2.15% 1.83% 1.55% 1.32% 1.12% 0.95% 0.81% 0.69% 0.59%Closing % 82.50% 61.88% 52.59% 44.70% 38.00% 32.30% 27.45% 23.34% 19.84% 16.86% 14.33% 12.18% 10.35% 8.80% 7.48% 6.36% 5.41% 4.59% 3.91% 3.32%Accelerated Deprn. Rs Lakh 105.65 124.51 56.03 47.63 40.48 34.41 29.25 24.86 21.13 17.96 15.27 12.98 11.03 9.38 7.97 6.77 5.76 4.89 4.16 3.54

Net Depreciation Benefit Rs Lakh 89.71 92.64 24.16 15.75 8.61 2.53 -2.63 -7.01 -10.74 -13.91 -16.61 -18.90 -20.84 -22.50 -23.91 -25.10 -26.12 -12.49 4.16 3.54Tax Benefit Rs Lakh 30.49 31.49 8.21 5.35 2.93 0.86 -0.89 -2.38 -3.65 -4.73 -5.64 -6.42 -7.09 -7.65 -8.13 -8.53 -8.88 -4.25 1.41 1.20Energy generation MU 1.40 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80 2.80Per unit benefit Rs/Unit 2.18 1.12 0.29 0.19 0.10 0.03 -0.03 -0.09 -0.13 -0.17 -0.20 -0.23 -0.25 -0.27 -0.29 -0.30 -0.32 -0.15 0.05 0.04Discounting Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140

Tax Benefit Levellised 5.97 Rs LakhElectricity Generation (Levellised) 2.65 MULevellised benefit 0.23 Rs/Unit

JKSERC Page 54

Annexure 2A

Small Hydro Power Projects (capacity below 5 MW)

Assumptions




Capacity Utilization Factor % 45%Auxiliary Consumption % 1.00%Useful Life Years 35


Capital Cost/MW Power Plant Cost - FY 2014-15 Rs Lacs 808




Debt: Equity

Debt % 70%

Equity % 30%



Debt Component





Equity Component



RoE Period Year 10





Income Tax % 33.990%



Depreciation




Salvage value % 10%





on energy charges



FY 2014-15 26.43




JKSERC Page 55


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 24 25 26 27 28 29 30 31 32 33 34 35Installed 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 1 1 1 1 1 1 1 1 1 1 1Net Generation MU 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90

Tariff Components(Fixed Charge) 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 24 25 26 27 28 29 30 31 32 33 34 35O&M Expenses Rs Lakh 26.43 27.94 29.54 31.23 33.02 34.90 36.90 39.01 41.24 43.60 46.10 48.73 51.52 54.47 57.58 60.88 64.36 68.04 71.93 76.05 80.40 85.00 89.86 95.00 100.43 106.18 112.25 118.67 125.46 132.63 140.22 148.24 156.72 165.69 175.16Depreciation Rs Lakh 47.16 47.16 47.16 47.16 47.16 47.16 47.16 47.16 47.16 47.16 47.16 47.16 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03 7.03Interest on term loan Rs Lakh 71.86 65.61 59.36 53.11 46.86 40.62 34.37 28.12 21.87 15.62 9.37 3.12 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Interest on working Capital Rs Lakh 5.30 5.24 5.19 5.13 5.09 5.05 5.01 4.99 4.96 4.95 5.17 5.17 4.32 4.48 4.66 4.84 5.04 5.25 5.47 5.70 5.94 6.20 6.47 6.76 7.07 7.39 7.73 8.10 8.48 8.88 9.31 9.76 10.24 10.74 11.28Return on Equity Rs Lakh 43.66 43.66 43.66 43.66 43.66 43.66 43.66 43.66 43.66 43.66 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36 53.36Total Fixed Cost Rs Lakh 194.41 189.61 184.90 180.29 175.78 171.38 167.10 162.93 158.89 154.99 161.16 157.55 116.22 119.34 122.63 126.11 129.79 133.67 137.78 142.13 146.73 151.58 156.72 162.15 167.89 173.96 180.37 187.15 194.32 201.90 209.92 218.39 227.35 236.81 246.83

Levallised tariff corresponding to Useful lifePer Unit Cost of Generation Unit Levellised 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35O&M expn Rs/kWh 1.00 0.68 0.72 0.76 0.80 0.85 0.89 0.95 1.00 1.06 1.12 1.18 1.25 1.32 1.40 1.48 1.56 1.65 1.74 1.84 1.95 2.06 2.18 2.30 2.43 2.57 2.72 2.88 3.04 3.21 3.40 3.59 3.80 4.02 4.25 4.49Depreciation Rs/kWh 1.02 1.21 1.21 1.21 1.21 1.21 1.21 1.21 1.21 1.21 1.21 1.21 1.21 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18 0.18Int. on term loan Rs/kWh 0.94 1.84 1.68 1.52 1.36 1.20 1.04 0.88 0.72 0.56 0.40 0.24 0.08 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Int. on working capital Rs/kWh 0.13 0.14 0.13 0.13 0.13 0.13 0.13 0.13 0.13 0.13 0.13 0.13 0.13 0.11 0.11 0.12 0.12 0.13 0.13 0.14 0.15 0.15 0.16 0.17 0.17 0.18 0.19 0.20 0.21 0.22 0.23 0.24 0.25 0.26 0.28 0.29RoE Rs/kWh 1.18 1.12 1.12 1.12 1.12 1.12 1.12 1.12 1.12 1.12 1.12 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37 1.37Total COG per unit Rs/kWh 4.27 4.98 4.86 4.74 4.62 4.50 4.39 4.28 4.17 4.07 3.97 4.13 4.04 2.98 3.06 3.14 3.23 3.33 3.43 3.53 3.64 3.76 3.88 4.02 4.15 4.30 4.46 4.62 4.80 4.98 5.17 5.38 5.60 5.83 6.07 6.32

LevellisedDiscount Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140 0.126 0.113 0.102 0.092 0.083 0.075 0.068 0.061 0.055 0.049 0.045 0.040 0.036 0.033 0.029Levellised Tariff 4.30 Rs/Unit

JKSERC Page 56



Accelerated DepreciationOpening % 100% 50% 5% 1% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%Allowed during the year % 50.00% 45.00% 4.00% 0.80% 0.16% 0.03% 0.01% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Closing % 50.00% 5.00% 1.00% 0.20% 0.04% 0.01% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Accelrated Deprn. Rs Lakh 404.22 363.80 32.34 6.47 1.29 0.26 0.05 0.01 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Net Depreciation Benefit Rs Lakh 382.88 321.11 -10.35 -36.22 -41.39 -42.43 -42.63 -42.68 -42.68 -42.69 -42.69 -42.69 -42.69 -42.69 -42.69 -42.69 -42.69 -23.28 0.00 0.00Tax Benefit Rs Lakh 130.14 109.15 -3.52 -12.31 -14.07 -14.42 -14.49 -14.51 -14.51 -14.51 -14.51 -14.51 -14.51 -14.51 -14.51 -14.51 -14.51 -7.91 0.00 0.00Energy generation MU 1.95 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90Per unit benefit Rs/Unit 6.67 2.80 -0.09 -0.32 -0.36 -0.37 -0.37 -0.37 -0.37 -0.37 -0.37 -0.37 -0.37 -0.37 -0.37 -0.37 -0.37 -0.20 0.00 0.00Discounting Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140


JKSERC Page 57

Annexure 2B

Small Hydro Power Projects (capacity 5 MW and upto 25 MW)

Assumptions




Capacity Utilization Factor % 45%Auxiliary Consumption % 1.00%Useful Life Years 35






Debt: Equity

Debt % 70%

Equity % 30%

Total Debt Amount Rs Lacs 3,086.768

Total Equity Amout Rs Lacs 1,322.901

Debt Component

Loan Amount Rs Lacs 3,087




Equity Component



RoE Period Year 10



Discount Rate (WACC) % 10.92%


Income Tax % 33.990%



Depreciation




Salvage value % 10%





on energy charges



FY 2014-15 114.18




JKSERC Page 58


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 24 25 26 27 28 29 30 31 32 33 34 35Installed Capacity MW 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6Net Generation MU 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42

Tariff Components(Fixed Charge) 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 24 25 26 27 28 29 30 31 32 33 34 35O&M Expenses Rs Lakh 114.18 120.71 127.61 134.91 142.63 150.79 159.41 168.53 178.17 188.36 199.14 210.53 222.57 235.30 248.76 262.99 278.03 293.94 310.75 328.52 347.32 367.18 388.18 410.39 433.86 458.68 484.92 512.65 541.98 572.98 605.75 640.40 677.03 715.76 756.70Depreciation Rs Lakh 257.23 257.23 257.23 257.23 257.23 257.23 257.23 257.23 257.23 257.23 257.23 257.23 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35 38.35Interest on term loan Rs Lakh 391.96 357.87 323.79 289.71 255.62 221.54 187.46 153.37 119.29 85.21 51.12 17.04 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Interest on working Capital Rs Lakh 27.24 26.81 26.40 26.01 25.64 25.30 24.99 24.70 24.45 24.22 25.27 25.11 20.25 20.97 21.73 22.53 23.38 24.27 25.22 26.22 27.28 28.39 29.58 30.83 32.15 33.54 35.02 36.58 38.23 39.98 41.82 43.77 45.84 48.02 50.32Return on Equity Rs Lakh 238.12 238.12 238.12 238.12 238.12 238.12 238.12 238.12 238.12 238.12 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04 291.04Total Fixed Cost Rs Lakh 1028.72 1000.74 973.15 945.98 919.25 892.98 867.21 841.96 817.26 793.14 823.80 800.95 572.21 585.65 599.87 614.90 630.79 647.59 665.35 684.12 703.97 724.96 747.14 770.60 795.39 821.61 849.32 878.62 909.59 942.34 976.96 1013.56 1052.25 1093.16 1136.40

Levallised tariff corresponding to Useful lifePer Unit Cost of Generation Unit Levellised 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35O&M expn Rs/kWh 0.72 0.49 0.52 0.54 0.58 0.61 0.64 0.68 0.72 0.76 0.80 0.85 0.90 0.95 1.00 1.06 1.12 1.19 1.26 1.33 1.40 1.48 1.57 1.66 1.75 1.85 1.96 2.07 2.19 2.31 2.45 2.59 2.73 2.89 3.06 3.23Depreciation Rs/kWh 0.92 1.10 1.10 1.10 1.10 1.10 1.10 1.10 1.10 1.10 1.10 1.10 1.10 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16Int. on term loan Rs/kWh 0.85 1.67 1.53 1.38 1.24 1.09 0.95 0.80 0.66 0.51 0.36 0.22 0.07 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Int. on working capital Rs/kWh 0.11 0.12 0.11 0.11 0.11 0.11 0.11 0.11 0.11 0.10 0.10 0.11 0.11 0.09 0.09 0.09 0.10 0.10 0.10 0.11 0.11 0.12 0.12 0.13 0.13 0.14 0.14 0.15 0.16 0.16 0.17 0.18 0.19 0.20 0.21 0.21RoE Rs/kWh 1.08 1.02 1.02 1.02 1.02 1.02 1.02 1.02 1.02 1.02 1.02 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24 1.24Total COG per unit Rs/kWh 3.69 4.39 4.27 4.16 4.04 3.93 3.81 3.70 3.60 3.49 3.39 3.52 3.42 2.44 2.50 2.56 2.63 2.69 2.77 2.84 2.92 3.01 3.10 3.19 3.29 3.40 3.51 3.63 3.75 3.88 4.02 4.17 4.33 4.49 4.67 4.85

LevellisedDiscount Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140 0.126 0.113 0.102 0.092 0.083 0.075 0.068 0.061 0.055 0.049 0.045 0.040 0.036 0.033 0.029Levellised Tariff 3.67 Rs/Unit

JKSERC Page 59




Net Depreciation Benefit Rs Lakh 2088.42 1751.52 -56.44 -197.55 -225.78 -231.42 -232.55 -232.77 -232.82 -232.83 -232.83 -232.83 -232.83 -232.83 -232.83 -232.83 -232.83 -127.00 0.00 0.00Tax Benefit Rs Lakh 709.85 595.34 -19.19 -67.15 -76.74 -78.66 -79.04 -79.12 -79.14 -79.14 -79.14 -79.14 -79.14 -79.14 -79.14 -79.14 -79.14 -43.17 0.00 0.00Energy generation MU 11.71 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42 23.42Per unit benefit Rs/Unit 6.06 2.54 -0.08 -0.29 -0.33 -0.34 -0.34 -0.34 -0.34 -0.34 -0.34 -0.34 -0.34 -0.34 -0.34 -0.34 -0.34 -0.18 0.00 0.00Discounting Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140


JKSERC Page 60

Annexure 3Biomass Power Projects

Assumptions



Installed Power Generation Capacity MW 1Plant Load Factor % 80%Auxiliary consumption % 10.00%


2 Project Cost Base Year (FY 2013-14) Rs Lacs 445Capital Cost/MW Power Plant Cost - FY 2014-15 Rs Lacs 467











Salvage value % 10%

5 Working CapitalFor Fixed ChargesO&M Charges Months 1Maintenance Spare (% of O&M exepenses) % 15%Receivables for Debtors Months 2Fuel cost Months 4Interest On Working Capital % 13.75%


7 Fuel related componentHeat Rate After Stabilisation period Kcal/kwh 4000

During Stablization Period Kcal/kwh 4000

Biomass Base Price(FY 2013-14) Rs/T 2500FY 2014-15 Rs/T 2773GCV - Biomass Kcal/kg 3300Biomass Price Escalation Factor 5%



JKSERC Page 61


Units Generation Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Installed Capacity MW 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Net Generation MU 5.12 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31 6.31

Vaiable Cost Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Biomass Cost Rs Lakh 191.37 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53 235.53

Tariff Components

(Fixed Charge) Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

O&M Expenses Rs Lakh 25.37 26.82 28.36 29.98 31.70 33.51 35.43 37.45 39.59 41.86 44.25 46.78 49.46 52.29 55.28 58.44 61.78 65.32 69.06 73.01Depreciation Rs Lakh 27.23 27.23 27.23 27.23 27.23 27.23 27.23 27.23 27.23 27.23 27.23 27.23 11.67 11.67 11.67 11.67 11.67 11.67 11.67 11.67Interest on term loan Rs Lakh 41.49 37.88 34.28 30.67 27.06 23.45 19.84 16.24 12.63 9.02 5.41 1.80 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Interest on working Capital Rs Lakh 17.10 20.20 20.20 20.21 20.22 20.24 20.26 20.29 20.33 20.37 20.55 20.61 20.35 20.51 20.68 20.86 21.05 21.25 21.46 21.68Return on Equity Rs Lakh 25.21 25.21 25.21 25.21 25.21 25.21 25.21 25.21 25.21 25.21 30.81 30.81 30.81 30.81 30.81 30.81 30.81 30.81 30.81 30.81Total Fixed Cost Rs Lakh 136.40 137.35 135.28 133.30 131.42 129.64 127.97 126.42 124.99 123.69 128.26 127.24 112.29 115.28 118.44 121.78 125.31 129.04 132.99 137.16

Levallised tariff corresponding to Useful life

Per Unit Cost of Generation Unit 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Variable cost Rs/kWh 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73 3.73O&M expn Rs/kWh 0.50 0.43 0.45 0.48 0.50 0.53 0.56 0.59 0.63 0.66 0.70 0.74 0.78 0.83 0.88 0.93 0.98 1.04 1.09 1.16Depreciation Rs/kWh 0.53 0.43 0.43 0.43 0.43 0.43 0.43 0.43 0.43 0.43 0.43 0.43 0.19 0.19 0.19 0.19 0.19 0.19 0.19 0.19Int. on term loan Rs/kWh 0.81 0.60 0.54 0.49 0.43 0.37 0.31 0.26 0.20 0.14 0.09 0.03 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Int. on working capital Rs/kWh 0.33 0.32 0.32 0.32 0.32 0.32 0.32 0.32 0.32 0.32 0.33 0.33 0.32 0.33 0.33 0.33 0.33 0.34 0.34 0.34RoE Rs/kWh 0.49 0.40 0.40 0.40 0.40 0.40 0.40 0.40 0.40 0.40 0.49 0.49 0.49 0.49 0.49 0.49 0.49 0.49 0.49 0.49Total COG per unit Rs/kWh 6.40 5.91 5.88 5.85 5.82 5.79 5.76 5.74 5.72 5.70 5.77 5.75 5.51 5.56 5.61 5.67 5.72 5.78 5.84 5.91

Discount Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140

Variable cost 3.73 Rs/Unit

Levellised Tariff (Fixed) 2.11 Rs/Unit

Levellised Tariff (for Tariff Period)5.84 Rs/Unit

JKSERC Page 62







Capital Cost 466.81

Years -----------------> Unit 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

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% 0.00% 0.00%



Opening % 100% 50% 5% 1% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%


Closing % 50.00% 5.00% 1.00% 0.20% 0.04% 0.01% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Accelrated Deprn. Rs Lakh 233.41 210.06 18.67 3.73 0.75 0.15 0.03 0.01 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Net Depreciation Benefit Rs Lakh 221.08 185.42 -5.98 -20.91 -23.90 -24.50 -24.62 -24.64 -24.65 -24.65 -24.65 -24.65 -24.65 -24.65 -24.65 -24.65 -24.65 -13.44 0.00 0.00

Tax Benefit Rs Lakh 75.15 63.02 -2.03 -7.11 -8.12 -8.33 -8.37 -8.38 -8.38 -8.38 -8.38 -8.38 -8.38 -8.38 -8.38 -8.38 -8.38 -4.57 0.00 0.00



0.95 0.86 0.77 0.70 0.63 0.57 0.51 0.46 0.41 0.37 0.34 0.30 0.27 0.25 0.22 0.20 0.18 0.16 0.15




JKSERC Page 63

Annexure 4

Non-fossil Fuel Based Cogeneration Power Projects

Assumptions




Plant Load Factor % 53%








Debt: Equity

Debt % 70%

Equity % 30%



Debt Component





Equity Component



RoE Period Year 10





Income Tax % 33.99%



Depreciation




Salvage value % 10%





Fuel cost Months 4



FY 2014-15 16.92


7 Fuel related componentHeat Rate After Stabilisation period Kcal/kwh 3600


Non fossil cogen Base Price(FY 2013-14) Rs/T 1600

FY 2014-15 Rs/T 1775

GCV Kcal/kg 2250Biomass Price Escalation Factor 5%



JKSERC Page 64

Determination of Tariff Component1 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140

Units Generation Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Installed Capacity MW 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1Net Generation MU 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25

Vaiable Cost Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Biomass Cost Rs Lakh 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82 131.82Per unit Var Cost Rs/kWh 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10

Tariff Components(Fixed Charge) Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20O&M Expenses Rs Lakh 16.92 17.88 18.91 19.99 21.13 22.34 23.62 24.97 26.40 27.91 29.50 31.19 32.97 34.86 36.85 38.96 41.19 43.55 46.04 48.67Depreciation Rs Lakh 25.70 25.70 25.70 25.70 25.70 25.70 25.70 25.70 25.70 25.70 25.70 25.70 11.01 11.01 11.01 11.01 11.01 11.01 11.01 11.01Interest on term loan Rs Lakh 39.16 35.76 32.35 28.95 25.54 22.13 18.73 15.32 11.92 8.51 5.11 1.70 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Interest on working Capital Rs Lakh 12.31 12.28 12.26 12.24 12.22 12.21 12.20 12.20 12.20 12.21 12.34 12.36 12.07 12.18 12.29 12.41 12.53 12.67 12.81 12.96Return on Equity Rs Lakh 23.79 23.79 23.79 23.79 23.79 23.79 23.79 23.79 23.79 23.79 29.08 29.08 29.08 29.08 29.08 29.08 29.08 29.08 29.08 29.08Total Fixed Cost Rs Lakh 117.88 115.41 113.01 110.67 108.39 106.18 104.04 101.99 100.01 98.12 101.73 100.03 85.14 87.13 89.24 91.46 93.82 96.31 98.94 101.72Per unit Fixed Cost Rs/kWh 2.77 2.72 2.66 2.61 2.55 2.50 2.45 2.40 2.35 2.31 2.39 2.35 2.00 2.05 2.10 2.15 2.21 2.27 2.33 2.39

Total cost of generation Rs Lakh 249.70 247.24 244.83 242.49 240.21 238.00 235.87 233.81 231.83 229.94 233.55 231.85 216.96 218.95 221.06 223.29 225.64 228.13 230.76 233.54

Levallised tariff corresponding to Useful lifePer Unit Cost of Generation Unit Levellised 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Variable cost Rs/kWh 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10 3.10O&M expn Rs/kWh 0.59 0.40 0.42 0.45 0.47 0.50 0.53 0.56 0.59 0.62 0.66 0.69 0.73 0.78 0.82 0.87 0.92 0.97 1.03 1.08 1.15Depreciation Rs/kWh 0.54 0.60 0.60 0.60 0.60 0.60 0.60 0.60 0.60 0.60 0.60 0.60 0.60 0.26 0.26 0.26 0.26 0.26 0.26 0.26 0.26Int. on term loan Rs/kWh 0.47 0.92 0.84 0.76 0.68 0.60 0.52 0.44 0.36 0.28 0.20 0.12 0.04 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Int. on working capital Rs/kWh 0.29 0.29 0.29 0.29 0.29 0.29 0.29 0.29 0.29 0.29 0.29 0.29 0.29 0.28 0.29 0.29 0.29 0.30 0.30 0.30 0.30RoE Rs/kWh 0.59 0.56 0.56 0.56 0.56 0.56 0.56 0.56 0.56 0.56 0.56 0.68 0.68 0.68 0.68 0.68 0.68 0.68 0.68 0.68 0.68Total COG per unit Rs/kWh 5.59 5.88 5.82 5.76 5.71 5.65 5.60 5.55 5.50 5.46 5.41 5.50 5.46 5.11 5.15 5.20 5.26 5.31 5.37 5.43 5.50

LevellisedDiscount Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140Variable cost 3.10 Rs/UnitLevellised Tariff (Fixed) 2.48 Rs/UnitLevellised Tariff (for Tariff Period)5.58 Rs/Unit

JKSERC Page 65




Net Depreciation Benefit Rs Lakh 208.66 175.00 -5.64 -19.74 -22.56 -23.12 -23.23 -23.26 -23.26 -23.26 -23.26 -23.26 -23.26 -23.26 -23.26 -23.26 -23.26 -12.69 0.00 0.00Tax Benefit Rs Lakh 70.92 59.48 -1.92 -6.71 -7.67 -7.86 -7.90 -7.91 -7.91 -7.91 -7.91 -7.91 -7.91 -7.91 -7.91 -7.91 -7.91 -4.31 0.00 0.00Energy generation MU 2.12 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25 4.25Discounting Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140


JKSERC Page 66

Annexure 5

Solar PV Power Projects

Assumptions












Debt: Equity

Debt % 70%

Equity % 30%



Debt Component





Equity Component



RoE Period Year 10





Income Tax % 33.99%



Depreciation




Salvage value % 10%





on energy charges



FY 2014-15 11.63




JKSERC Page 67



Tariff Components



Discount Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140 0.126 0.113 0.102 0.092 0.083Levellised Tariff 7.50 Rs/Unit

JKSERC Page 68







Capital Cost 691

Years -----------------> 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 25

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% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Book Depreciation Rs Lakh 18.24 36.48 36.48 36.48 36.48 36.48 36.48 36.48 36.48 36.48 36.48 36.48 36.48 36.48 36.48 36.48 36.48 19.90 0.00 0.00 0.00 0.00 0.00 0.00 0.00


Opening % 100% 50% 5% 1% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%

Allowed during the year % 50.00% 45.00% 4.00% 0.80% 0.16% 0.03% 0.01% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Closing % 50.00% 5.00% 1.00% 0.20% 0.04% 0.01% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Accelrated Deprn. Rs Lakh 345.50 310.95 27.64 5.53 1.11 0.22 0.04 0.01 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Net Depreciation Benefit Rs Lakh 327.26 274.47 -8.84 -30.96 -35.38 -36.26 -36.44 -36.48 -36.48 -36.48 -36.48 -36.48 -36.48 -36.48 -36.48 -36.48 -36.48 -19.90 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Tax Benefit Rs Lakh 111.23 93.29 -3.01 -10.52 -12.03 -12.33 -12.39 -12.40 -12.40 -12.40 -12.40 -12.40 -12.40 -12.40 -12.40 -12.40 -12.40 -6.76 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Energy generation MU 0.83 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1.66

Per unit benefit Rs/Unit 13.37 5.61 -0.18 -0.63 -0.72 -0.74 -0.74 -0.74 -0.75 -0.75 -0.75 -0.75 -0.75 -0.75 -0.75 -0.75 -0.75 -0.41 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Discounting Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140 0.126 0.113 0.102 0.092 0.083

0.95 0.86 0.77 0.70 0.63 0.57 0.51 0.46 0.41 0.37 0.34 0.30 0.27 0.25 0.22 0.20 0.18 0.16 0.15




JKSERC Page 69

Annexure 6Solar Thermal Power Projects

Assumptions
















Salvage value % 10%





JKSERC Page 70



Tariff Components




JKSERC Page 71







Capital Cost 1200

Years -----------------> 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 25

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% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Book Depreciation Rs Lakh 31.68 63.36 63.36 63.36 63.36 63.36 63.36 63.36 63.36 63.36 63.36 63.36 63.36 63.36 63.36 63.36 63.36 34.56 0.00 0.00 0.00 0.00 0.00 0.00 0.00


Opening % 100% 50% 5% 1% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%

Allowed during the year % 50.00% 45.00% 4.00% 0.80% 0.16% 0.03% 0.01% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Closing % 50.00% 5.00% 1.00% 0.20% 0.04% 0.01% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Accelrated Deprn. Rs Lakh 600.00 540.00 48.00 9.60 1.92 0.38 0.08 0.02 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Net Depreciation Benefit Rs Lakh 568.32 476.64 -15.36 -53.76 -61.44 -62.98 -63.28 -63.34 -63.36 -63.36 -63.36 -63.36 -63.36 -63.36 -63.36 -63.36 -63.36 -34.56 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Tax Benefit Rs Lakh 193.17 162.01 -5.22 -18.27 -20.88 -21.41 -21.51 -21.53 -21.54 -21.54 -21.54 -21.54 -21.54 -21.54 -21.54 -21.54 -21.54 -11.75 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Energy generation MU 0.91 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81 1.81

Per unit benefit Rs/Unit 21.31 8.93 -0.29 -1.01 -1.15 -1.18 -1.19 -1.19 -1.19 -1.19 -1.19 -1.19 -1.19 -1.19 -1.19 -1.19 -1.19 -0.65 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Discounting Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140 0.126 0.113 0.102 0.092 0.083




JKSERC Page 72

Annexure 7Biomass Gasifier Power Projects

Assumptions
















Salvage value % 10%



7 Fuel related component Sp. Fuel consumption kg/kWh 1.25Heat Rate After Stabilisation period Kcal/kwh 3600


Non fossil cogen Base Price(FY 2013-14) Rs/T 2500FY 2014-15 Rs/T 2773GCV Kcal/kg 2250Biomass Price Escalation Factor 5%



JKSERC Page 73


Units Generation Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Installed Capacity MW 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1Net Generation MU 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70 6.70

Vaiable Cost Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Biomass Cost Rs Lakh 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34 330.34Per unit Var Cost Rs/kWh 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93

Tariff Components(Fixed Charge) Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20O&M Expenses Rs Lakh 42.29 44.71 47.26 49.97 52.83 55.85 59.04 62.42 65.99 69.76 73.75 77.97 82.43 87.15 92.13 97.40 102.97 108.87 115.09 121.68Depreciation Rs Lakh 24.91 24.91 24.91 24.91 24.91 24.91 24.91 24.91 24.91 24.91 24.91 24.91 10.67 10.67 10.67 10.67 10.67 10.67 10.67 10.67Interest on term loan Rs Lakh 37.95 34.65 31.35 28.05 24.75 21.45 18.15 14.85 11.55 8.25 4.95 1.65 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Interest on working Capital Rs Lakh 27.64 27.70 27.76 27.84 27.92 28.01 28.12 28.23 28.35 28.49 28.76 28.92 28.79 29.06 29.34 29.64 29.95 30.28 30.63 31.00Return on Equity Rs Lakh 23.06 23.06 23.06 23.06 23.06 23.06 23.06 23.06 23.06 23.06 28.18 28.18 28.18 28.18 28.18 28.18 28.18 28.18 28.18 28.18Total Fixed Cost Rs Lakh 155.84 155.02 154.34 153.82 153.46 153.27 153.27 153.46 153.85 154.46 160.55 161.62 150.08 155.06 160.33 165.89 171.78 178.00 184.58 191.53Per unit Fixed Cost Rs/kWh 2.33 2.31 2.30 2.30 2.29 2.29 2.29 2.29 2.30 2.30 2.40 2.41 2.24 2.31 2.39 2.48 2.56 2.66 2.75 2.86


Per Unit Cost of Generation Unit Levellised 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Variable cost Rs/kWh 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93 4.93O&M expn Rs/kWh 0.94 0.63 0.67 0.71 0.75 0.79 0.83 0.88 0.93 0.98 1.04 1.10 1.16 1.23 1.30 1.37 1.45 1.54 1.62 1.72 1.82Depreciation Rs/kWh 0.33 0.37 0.37 0.37 0.37 0.37 0.37 0.37 0.37 0.37 0.37 0.37 0.37 0.16 0.16 0.16 0.16 0.16 0.16 0.16 0.16Int. on term loan Rs/kWh 0.29 0.57 0.52 0.47 0.42 0.37 0.32 0.27 0.22 0.17 0.12 0.07 0.02 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Int. on working capital Rs/kWh 0.42 0.41 0.41 0.41 0.42 0.42 0.42 0.42 0.42 0.42 0.43 0.43 0.43 0.43 0.43 0.44 0.44 0.45 0.45 0.46 0.46RoE Rs/kWh 0.36 0.34 0.34 0.34 0.34 0.34 0.34 0.34 0.34 0.34 0.34 0.42 0.42 0.42 0.42 0.42 0.42 0.42 0.42 0.42 0.42Total COG per unit Rs/kWh 7.27 7.25 7.24 7.23 7.22 7.22 7.22 7.22 7.22 7.23 7.23 7.33 7.34 7.17 7.24 7.32 7.40 7.49 7.59 7.68 7.79

Discount Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140Variable cost 4.93 Rs/UnitLevellised Tariff (Fixed) 2.34 Rs/UnitLevellised Tariff (for Tariff Period)7.27 Rs/Unit

JKSERC Page 74

Accelerated DepreciationDepreciation amount 90%Book Depreciation rate 5.28%Tax Depreciation rate 80%Additional Depreciation 20.00%Income Tax (Normal Rates) 33.99%Capital Cost 427





JKSERC Page 75

Annexure 8

Biogas Power Projects

Assumptions





2 Project Cost Base Year (FY 2013-14) Rs Lacs 800.00Capital Cost/MW Power Plant Cost - FY 2014-15 Rs Lacs 1153.91


Net capital cost Rs Lacs 853.915









Salvage value % 10%



7 Fuel related component Sp. Fuel consumption kg/kWh 3.00Heat Rate After Stabilisation period Kcal/kwh 3600


Non fossil cogen Base Price(FY 2013-14) Rs/T 990FY 2014-15 Rs/T 1098GCV Kcal/kg 2250Biomass Price Escalation Factor 5%



JKSERC Page 76


Units Generation Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Installed Capacity MW 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Net Generation MU 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94 6.94

Vaiable Cost Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Biogas Cost Rs Lakh 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51 138.51Per unit Var Cost Rs/kWh 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00

Tariff Components

(Fixed Charge) Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

O&M Expenses Rs Lakh 42.29 44.71 47.26 49.97 52.83 55.85 59.04 62.42 65.99 69.76 73.75 77.97 82.43 87.15 92.13 97.40 102.97 108.87 115.09 121.68Depreciation Rs Lakh 49.81 49.81 49.81 49.81 49.81 49.81 49.81 49.81 49.81 49.81 49.81 49.81 21.35 21.35 21.35 21.35 21.35 21.35 21.35 21.35Interest on term loan Rs Lakh 75.90 69.30 62.70 56.10 49.50 42.90 36.30 29.70 23.10 16.50 9.90 3.30 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Interest on working Capital Rs Lakh 16.16 16.14 16.13 16.12 16.13 16.15 16.17 16.21 16.25 16.31 16.62 16.70 16.21 16.47 16.75 17.05 17.36 17.70 18.05 18.42Return on Equity Rs Lakh 46.11 46.11 46.11 46.11 46.11 46.11 46.11 46.11 46.11 46.11 56.36 56.36 56.36 56.36 56.36 56.36 56.36 56.36 56.36 56.36Total Fixed Cost Rs Lakh 230.27 226.07 222.01 218.12 214.38 210.82 207.44 204.25 201.26 198.50 206.44 204.15 176.35 181.33 186.59 192.16 198.05 204.27 210.85 217.80Per unit Fixed Cost Rs/kWh 3.32 3.26 3.20 3.14 3.09 3.04 2.99 2.94 2.90 2.86 2.98 2.94 2.54 2.61 2.69 2.77 2.85 2.94 3.04 3.14


Levallised tariff corresponding to Useful life

Per Unit Cost of Generation Unit Levellised 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Variable cost Rs/kWh 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00O&M expn Rs/kWh 0.90 0.61 0.64 0.68 0.72 0.76 0.80 0.85 0.90 0.95 1.01 1.06 1.12 1.19 1.26 1.33 1.40 1.48 1.57 1.66 1.75Depreciation Rs/kWh 0.64 0.72 0.72 0.72 0.72 0.72 0.72 0.72 0.72 0.72 0.72 0.72 0.72 0.31 0.31 0.31 0.31 0.31 0.31 0.31 0.31Int. on term loan Rs/kWh 0.56 1.09 1.00 0.90 0.81 0.71 0.62 0.52 0.43 0.33 0.24 0.14 0.05 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00Int. on working capital Rs/kWh 0.24 0.23 0.23 0.23 0.23 0.23 0.23 0.23 0.23 0.23 0.24 0.24 0.24 0.23 0.24 0.24 0.25 0.25 0.26 0.26 0.27RoE Rs/kWh 0.70 0.66 0.66 0.66 0.66 0.66 0.66 0.66 0.66 0.66 0.66 0.81 0.81 0.81 0.81 0.81 0.81 0.81 0.81 0.81 0.81Total COG per unit Rs/kWh 5.04 5.32 5.25 5.20 5.14 5.09 5.04 4.99 4.94 4.90 4.86 4.97 4.94 4.54 4.61 4.69 4.77 4.85 4.94 5.04 5.14

Levellised

Discount Factor 1.000 0.902 0.813 0.733 0.661 0.596 0.537 0.484 0.436 0.393 0.355 0.320 0.288 0.260 0.234 0.211 0.190 0.172 0.155 0.140

Variable cost 2.00 Rs/Unit

Levellised Tariff (Fixed) 3.04 Rs/Unit

Levellised Tariff 5.04 Rs/Unit

JKSERC Page 77






JKSERC Page 78

jammu & kashmir state electricity regulatory … levelised tariff for res_fy 2014-15...jammu...

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