rajasthan electricity regulatory …rerc.rajasthan.gov.in/cnpl/pdfs/solar.pdfpage 1 of 15 rajasthan...

of 15

RAJASTHAN ELECTRICITY REGULATORY COMMISSION, JAIPUR

Suo-Motu

In the matter of Determination of Benchmark Capital Cost for Solar PV

and Solar Thermal Power Projects for FY 2013-14 and resultant Generic

Levellised Tariff.

Coram :

Shri D.C. Samant, Chairman

Shri S.K. Mittal, Member

Shri S. Dhawan, Member

DRAFT ORDER

BACKGROUND

1. In accordance with the provisions of Electricity Act, 2003 and

National Tariff Policy notified by Govt. of India (GoI), the

Commission under its RERC (Terms and Conditions for

Determination of Tariff) Regulations, 2009 had incorporated the

enabling provisions for determination of generic tariff for solar

power projects.

2. Commission had issued the last Tariff Order on 30.05.2012, wherein

Commission had determined generic tariff for solar power plants,

which was applicable for solar PV plants (SPV) where PPA was

signed on or before 31.03.2013 and getting commissioned on or

before 31.03.2014 and solar thermal plants where PPA was signed

on or before 31.03.2013 and getting commissioned on or before

31.03.2015. The tariff as per the above mentioned Order is given in

the following table:

Table-1: Solar Tariffs in Rajasthan as per Tariff Order dated 30.05.2012

S.

No. Particulars

Tariff (`/kWh) if

AD benefit is

not availed

Tariff (`/kWh) if

AD benefit is

availed

1 2 3 4

1 Solar Photo Voltaic (PV) Power

Plants commissioned by 31.3.2014

9.63 8.42

2 Solar Thermal Power Plants 11.95 10.45

of 15

S.

No. Particulars

Tariff (`/kWh) if

AD benefit is

not availed

Tariff (`/kWh) if

AD benefit is

availed

1 2 3 4

commissioned by 31.3.2015

3 Roof Top Solar PV installations and

other small solar PV power

generation plants covered in

MNRE’s scheme or Rajasthan Solar

Energy Policy to be commissioned

by 31.3.2014

9.63 8.42

4 Small Solar Thermal Power

generation plants covered in

MNRE’s scheme or Rajasthan Solar

Energy Policy to be commissioned

by 31.03.2015

11.95 10.45

3. CERC has recently issued Order on 28.02.2013 (Petition No.

243/SM/2012 (Suo-Motu) in the matter of determination of generic

levellised generation tariff for FY 2013-14 of various RE sources

which include the category of Solar Photo Voltaic (PV) and Solar

Thermal Power Projects. CERC in the above Order has determined

a generic tariff of `8.75 per unit (`7.87 per unit if AD benefit is

availed) in respect of solar PV projects and a generic tariff of

`11.90 per unit (`10.69 per unit if AD benefit is availed) for solar

thermal projects whose PPAs would be signed by 31.03.2014 and

to be commissioned by 31.03.2015 in the case of solar PV projects

and by 31.03.2016 in the case of solar thermal projects.

TARIFFS FOR MW SCALE SOLAR POWER PROJECTS WHERE PPA IS SIGNED

ON OR BEFORE 31.03.2014 AND TO BE COMMISSIONED ON OR BEFORE

31.03.2015 IN CASE OF SOLAR PV PLANTS AND TO BE COMMISSIONED

ON OR BEFORE 31.03.2016 IN CASE OF SOLAR THERMAL PLANTS

4. The RERC Tariff Order dated 30.05.2012 is applicable for the Solar

projects that have signed PPA on or before 31.3.2013 and to be

commissioned on or before 31.3.2014 in the case of solar PV and

on or before 31.3.2015 in the case of solar thermal projects. The

Commission through this Order now proposes to determine tariff for

the MW scale solar projects where PPA is signed on or before

of 15

31.03.2014 and to be commissioned on or before 31.03.2015 in the

case of solar PV projects and to be commissioned on or before

31.03.2016 in the case of solar thermal projects.

Norms and Financial Parameters

5. In the previous Solar Tariff Order issued on 30.05.2012, Commission

adopted the financial norms, as stipulated in Part – III of RERC Tariff

Regulations, 2009 i.e. debt: equity ratio, RoE, Depreciation and

O&M escalation etc, that are applicable for the tariff

determination of other RE sources like wind/bio-mass. The summary

of key normative parameters considered in the said Tariff Order

are as under:

Table-2: Summary of key normative parameters for solar PV

S.No. Parameter Value

1 2 3

1 Capital cost `9.40 crore per MW for FY 2012-13

2 Capacity Utilization Factor

(CUF)

20% with a deration of 0.5% every

year after second year.

3 Interest on term loan 12.3% p.a

4 Interest on working capital 11.8%p.a.

5 O&M Expenses

`11 lakhs/MW for FY 2012-13 with

an escalation of 5.72% p.a. plus

0.3% of depreciated project cost

in each year towards insurance.

6 Auxiliary consumption 0.25%

Table-3: Summary of key normative parameters for solar thermal


1 2 3

1 Capital cost ` 12.75 crore per MW for FY 2012-13

2 Capacity Utilization

Factor (CUF)


year after fourth year.

3 Interest on term loan 12.3% p.a

4 Interest on working

capital

11.8% p.a.

5 O&M Expenses ` 15 lakhs /MW for FY 2012-13 with an

of 15


1 2 3

escalation of 5.72% p.a. plus 0.3% of

depreciated project cost in each

year towards insurance.

6 Auxiliary consumption 6.5%

6. Commission considers it appropriate to continue to retain the

financial norms, as stipulated in Part – III of RERC Tariff Regulations,

2009 i.e. debt: equity ratio, RoE, depreciation and O&M escalation

that are applicable for the tariff determination of other RE sources

like wind/bio-mass and were used for tariff order dt 30.05.2012 for

both Solar PV and Solar thermal projects. Parameters like auxiliary

consumption, CUF and de-ration are proposed to be retained as

adopted in Tariff Order dated 30.05.2012.

7. Accordingly, the following parameters for determination of tariff

for FY 2013-14 have been reviewed based on the latest

developments and current trends:

(a) Capital cost; and

(b) Operation and Maintenance (O&M) Expenses.

Norms for Solar PV Projects

8. Capital Cost

(1) CERC in their other Order dated 28 February, 2013 in the

matter of determination of benchmark capital cost norm for

solar PV power projects and Solar Thermal power projects

have carried out detailed analysis for evolving the

benchmark capital cost norm for solar PV Power Projects for

the FY 2013‐14. In their Order, CERC based on discussion with

various stakeholders observed that some of the top Solar PV

manufacturers are currently selling their first tier crystalline

modules in India at a price as low as $ 0.60/Wp. Relying on

Mercom's market intelligence report on Solar, CERC has also

of 15

observed that prices of Solar components continue to drop

moderately. The said report further says that even with

demand from China, Japan and Germany, oversupply

continues to pressure the solar component projects. CERC

has also referred PV insights report on solar module spot price

(last updated on 23.01.2013), which reveals that silicon

module prices were being traded in the range of 0.55 US $ to

1.00 US$ with an average of around 0.657 US$. CERC also

observed that based on solar market report of Mercom

(21.01.2013), there is a downward trend in the module prices

which may not remain same as observed in FY 2011-12. CERC

finally decided a module cost of 0.60 US $/Wp for

determination of benchmark capital cost for solar PV for FY

2013-14. Considering an average of daily exchange rate of

`54.32/US$ of past six months, CERC has given the breakup of

benchmark capital cost norm for solar PV projects as under:

Table-4: Break-up for capital cost projection

S.No. Particulars

Capital cost

Norm for

Solar PV

project

(Rs Lakh/MW)

1 PV Modules 325.92

2 Additional module cost as against

degradation

9.79

2 Land Cost 16.80

3 Civil and General Works 94.50

4 Mounting Structures 105.00

5 Power Conditioning Unit 60.00

6 Evacuation cost up to interconnection

point (cables and Transformers)

105.00

7 Preliminary and Pre-operative expenses

including IDC and contingency

80.00

8 Total Capital Cost 797.01

Finally, CERC arrived at the benchmark capital cost for solar

PV power projects, after rounding off, as `8.00 Crores/MW.

of 15

(2) According to the pvinsights, one of the source, which CERC

included in their analysis, the Silicon and Thin Film Module’s

weekly spot prices per watt on 06.03.2013 range from

US$0.55 to US$0.99 per watt for Silicon Solar Module

averaging to US$0.667 and from US$0.52 to US$0.94 per watt

for Thin Film Solar Module averaging to US$0.620. It can be

seen that the prices are almost at the same level as

indicated by CERC in their analysis in their order dated

28.02.2013:

Table-5: Silicon cell & Module weekly spot prices

Item High Low Average Avg. Chg Avg. Chg %

Silicon Solar

Module 0.99 0.55 0.667 ↑ 0.004 ↑ 0.6%

Thin Film

Solar

Module

0.94 0.52 0.620 ↑ 0.002 ↑ 0.32%

Unit: USD Per Watt Last updated: 06.03.2013

(Source: http://pvinsights.com/)

(3) CERC in their capital cost break up for solar PV projects has

included Rs 9.79 Lakh/MW towards additional module cost as

against degradation. It may be mentioned that Commission

has provided for a de-ration at the rate of 0.50% p.a. from 2nd

year separately as mentioned later in this Order ,therefore,

Commission considers it appropriate that degradation may

not be required to be accounted for separately in the capital

cost.

(4) Further, the capital cost arrived at as above by CERC is in the

all India context, however, situation varies from State to State.

The State Government through Rajasthan Solar Policy 2011 is

also extending support for setting up of Solar Plants including

offering land at concessional rates of 10% of DLC rate

(agriculture land) as per the provisions of Rajasthan Land

Revenue (Allotment of Land for setting up of power plant

of 15

based on Renewable Energy Sources) Rules 2007 as

amended from time to time.

(5) In light of the position brought out as above, Commission

proposes to adopt a benchmark capital cost of `7.60 Crores

per MW for Solar PV projects for FY 2013-14, including

connectivity charges of ` 2.0 Lakh/MW.

9. Interest Rate

Following the same principle as adopted in tariff order of previous

year, Commission has taken interest rate equivalent to the

average SBI Base rate prevailing during the first six months of the

previous year i.e. FY 2012-13 plus 300 basis points for working out

interest on long term loans for FY 2013-14. The average SBI Base

rate of first six months of previous year i.e. FY 2012-13 was 10% and

the long term interest rate, therefore, works out to be 13%.

For working out the interest on working capital requirement for FY

2013-14, Commission based on the principle adopted in the Tariff

Order for previous year has taken average SBI Base rate prevailing

during first six months of previous year i.e. FY 2012-13 plus 250 basis

points. The interest rate for working capital requirement, therefore,

works out to be 12.50%.

10. O&M Expenses

For solar PV plants, Commission, in Order dt. 30.05.2012, considered

the O&M expenses of ` 11.0 Lakh per MW for the year 2012-13 with

an annual escalation of 5.72% along with 0.3% towards insurance

cost every year on the depreciated value of the asset. CERC has

adopted O&M norm of ` 11.63 Lakh per MW towards O&M

expenses of solar PV plants in their recent RE Tariff Order dated

28.02.2013 for FY 2013-14. Commission observes that norm of `11.00

of 15

Lakh/MW for FY 2012-13 when escalated at the rate of 5.72%,

works out to `11.63 Lakh/MW for FY 2013-14. Therefore, Commission

proposes to adopt a benchmark norm for O&M Expenses of `11.63

Lakh/MW for FY 2013-14 and annual escalation of 5.72% and

additionally, 0.3% of the depreciated value of the asset would be

provided towards insurance of the plant.

Summary of Norms for solar PV projects

11. Based on the above discussion and other parameters of the earlier

Order dtd. 30.05.2012, which are being retained, the key

normative parameters being adopted for solar PV are given in the

following Table:

Table-6: Summary of key normative parameters for solar PV


1 2 3

1 Capital cost `7.60 crore per MW for FY 2013-14

2 Capacity Utilisation Factor

(CUF)


year after second year

3 Interest on term loan 13.00% p.a.

4 Interest on working capital 12.50% p.a.

5 O&M Expenses

`11.63 Lakh/MW for FY 2013-14

with an escalation of 5.72% p.a.

plus 0.3% of depreciated project

cost in each year towards

insurance.

6 Auxiliary Consumption 0.25%

The complete tariff parameters/assumptions along with detailed

computations for the generic tariff for solar PV tariff are given at

Annexure-1.

12. Applicable Tariff for Solar PV Plants

Considering the parameters discussed above, the generic tariff for

Solar PV plants is being determined as ` 8.15/kWh, as per

calculation sheet placed at Annnexure-II. This tariff is levellised

tariff for 25 years and applicable for plants commissioned without

of 15

availing benefit of Accelerated Depreciation. With AD benefit, the

tariff would be lower by ` 0.99/kWh i.e. ` 7.16/kWh. This tariff

would be applicable for solar PV plants where PPA is signed on or

before 31.03.2014 and which get commissioned on or before

31.03.2015.

Norms for Solar Thermal projects

13. Capital Cost

(1) CERC in their Order dated 28.02.2013 in the matter of

Benchmark Capital Cost Norms for Solar PV and Solar

Thermal Power projects to be applicable for the year 2013-

14 has referred the study report on “Concentrated Solar

Power: Heating Up India’s Solar Thermal Market under the

National Solar Mission-September, 2012”, prepared by

Council on Energy, Environment and Water and Natural

Resources Defense Council. As per the said report,

according to Indian developers consulted, the cost of a

parabolic trough CSP plant in India ranges from `10.5 Crores

to `13.00 Crores per MW (approximately $ 1.9 million to $ 2.3

million per MW) in capital cost. It is also mentioned that

storage increases the capital cost further but also increases

electricity generation. CERC has adopted the project cost

as `12.00 Crores per MW.

(2) IRENA in their report titled “IEA-ETSAP and IRENA©

Technology Brief E10 – January 2013 for Concentrating Solar

Power Technology Brief” suggests that as the global installed

capacity is limited and the technology is still under

deployment, the cost of Concentrated Solar Power (CSP)

plants and CSP electricity varies significantly depending on

local labour and land cost, the size of the plant, the thermal

of 15

storage system (if any), and – last but not least – the level of

maturity (i.e. demo, pilot, commercial) of the project.

(3) Commission also observes that no significant experience is

available about performance of CSP plants in the State. In

light of the above discussion and considering the support

from the State Government, Commission proposes to adopt

a benchmark capital cost of ` 11.80 Crores per MW for Solar

Thermal Projects for FY 2013-14, including connectivity

charges of ` 2.0 Lakh/MW.

14. Interest Rate

On the similar lines to Solar PV plants, for Solar thermal power

plants also, Commission has taken interest rate for long term loans

for FY 2013-14 as the average SBI base rate prevailing during the

first six months of the previous year i.e. FY 2012-13 plus 300 basis

points, which works out to be 13% (=10%+3.00%).

For working out the interest on working capital requirement for FY

2013-14, on similar lines to solar PV plants, Commission has taken

interest rate as the average SBI Base rate prevailing during first six

months of previous year i.e. FY 2012-13 plus 250 basis, which works

out to be 12.50% (=10%+2.50%).

15. O&M Expenses

For solar thermal plants, Commission, in Order dt. 30.05.2012, has

considered the O&M expenses of ` 15.00 Lakh/MW for 2012-13

with an annual escalation of 5.72% along with 0.3% towards

insurance cost every year on the depreciated value of the asset.

CERC has adopted ` 15.86 Lakh/MW towards O&M expenses of

solar thermal plants in their recent RE Tariff Order dated 28.02.2013

for FY 2013-14. Commission observes that norm of `15.00 Lakh/MW

of 15

for FY 2012-13 when escalated at the rate of 5.72%, works out to

`15.86 Lakh/MW for FY 2013-14. Therefore, Commission proposes to

adopt a benchmark norm for O&M Expenses of `15.86 Lakh/MW

for FY 2013-14 and annual escalation of 5.72% and additionally

0.3% of the depreciated value of the asset would be provided

towards insurance of the plant.

16. Summary of Norms for Solar Thermal projects

Based on the above discussion and other parameters of the earlier

Order dtd. 30.05.2012 being retained, the normative parameters

being adopted by the Commission for solar thermal power plants

are given in the following table:

Table-7: Summary of key normative parameters for solar thermal


1 2 3

1 Capital cost ` 11.80 Crores per MW for FY 2013-

14

2 Capacity Utilisation Factor

(CUF)

23% with a deration of 0.25%

every year after fourth year.

3 Interest on term loan 13.00% p.a.

4 Interest on working capital 12.50% p.a.

5 O&M Expenses ` 15.86 Lakh /MW for FY 2013-14

with an escalation of 5.72% p.a.

plus 0.3% of depreciated project

cost in each year towards

insurance.

6 Auxiliary Consumption 6.5%

The complete tariff parameters/assumptions along with detailed

computations for the generic tariff for solar thermal tariff are given

at Annexure-2.

17. Applicable Tariff for Solar Thermal projects

Considering the parameters discussed above, the generic tariff for

the solar thermal power plants is being determined as `

11.37/kWh, as per calculation sheet given at Annexure-2. This tariff

of 15

is levellised for 25 years and applicable for plants commissioned

without availing benefit of Accelerated Depreciation. The tariff

would be lower by ` 1.40/kWh if accelerated depreciation is

availed i.e. the tariff would be ` 9.97/kWh. This tariff would be

applicable for solar thermal plants where PPA is signed on or

before 31.03.2014 and which get commissioned on or before

31.03.2016.

Roof top and small solar PV and thermal systems: Applicable Tariff

18. Commission is of the considered view that the generic tariff as

applicable for MW scale solar PV plants be extended to roof top

and small solar power generation systems also. However, this tariff

would not be applicable to roof top and small solar power

generation systems which are getting support by way of capital

subsidy etc., under MNRE/JNNSM schemes. The tariff for these roof

top PV and small solar plants, which would get support by way of

capital subsidy, would be determined separately based on terms

and conditions of the relevant scheme.

Guidelines for Metering, Billing and other Requirements

19. The guidelines laid down as per order dtd. 25.05.2010 as regards (i)

Metering and Billing arrangement; (ii) Technical requirements; and

(iii) General Terms and Conditions are being retained and would

be suitably incorporated in the PPA.

Conclusion

20. The generic tariff levellised for 25 years for two different

technologies (solar PV & solar thermal) and for Roof Top and small

solar plants is summarized as under:

of 15

Table- 8: Summary of Solar PV and Solar Thermal Tariffs

S.

No. Particulars

Tariff (`/kWh) if

AD benefit is

not availed

Tariff (`/kWh) if

AD benefit is

availed

1 2 3 4

1 Solar Photo Voltaic (PV) Power

Plants commissioned by 31.3.2015

8.15 7.16

2 Solar Thermal Power Plants


11.37 9.97

3 Roof Top Solar PV installations and

other small solar PV power

generation plants to be


8.15 7.16

4 Small Solar Thermal Power

generation plants to be


11.37 9.97

21. Both the tariff mentioned in the above table i.e. with or without

availing accelerated depreciation would be valid tariff for

purchase of Solar Power by distribution licensees from solar

generation plants set up in Rajathan.

22. For a solar power generator claiming the higher tariff worked out

as above for projects not availing Accelerated Depreciation

benefit, Commission considers it appropriate to lay down

modalities as under:

(1) The PPA should include an undertaking of the solar power

generator that Accelerated Depreciation benefit would not

be availed for the generating plant/unit;

(2) The first bill raised by the solar power generator shall be

accompanied by an undertaking that Accelerated

Depreciation benefit shall not be claimed. Based on this,

the applicable tariff would be allowed;

(3) The claims of energy charges as per applicable tariff may

be entertained based on the said undertaking upto the due

date of filing of Income Tax Return of the relevant financial

year. This would mean 30th September, 2014 for payment for

of 15

the financial year 13-14 and for the first six months (upto 30th

September) of financial year 14-15 and so on;

(4) After filing of Income Tax Return a certificate from a

Chartered Accountant (CA) that Accelerated Depreciation

has not been claimed would have to be submitted or in the

alternative a copy of Income Tax Return filed with Income

Tax Department wherein Accelerated Depreciation has not

been claimed along with verification of Tax Consultant may

be furnished;

(5) As Income Tax Return is required to be filed in the next year,

the payment of amount corresponding to non-availment of

Accelerated Depreciation in respect of energy supplied in

the month of October onwards of the financial year

following the financial year of commissioning of the plant

would be made only after the said certificate/copy of

Income Tax Return is furnished;

(6) For the energy supplied in the months of October onwards,

the methodology as given in sub-paras (4) & (5) above be

followed.

Commission also considers it appropriate that undertaking of the

power generator in PPA saying that benefit of Accelerated

Depreciation would not be availed should also include an

undertaking that in case it is found that benefit of Accelerated

Depreciation has been claimed, the licensee would be entitled to

recover the additional amount wrongly claimed by power

generator along with penal charges @ 1.50% per month.

of 15

23. A solar power generator not availing CDM benefit would need to

give an annual undertaking that CDM benefit has not been

availed. However, if CDM benefit is availed, it would have to be

shared with distribution licensee as envisaged in Regulation 42 of

RERC Tariff Regulations 2009.

24. Grid connectivity charges are governed by regulation 89(2) of

current MYT Regulations and therefore, Connectivity charges @ `

2.00 Lakh per MW, would be payable.

25. Purchase beyond RPO would be in accordance with the decision

to be taken by the Commission in respect of policy directive issued

by the State Govt. under Section 108 of the Electricity Act,2003.

26. The metering shall be at the generator premises as provided in

CEA Metering Regulations.

27. This Suo-Motu Draft Order is issued to invite comments and

suggestions from all the stakeholders including RE developers,

Distribution Licensee, RREC etc. All stakeholders may submit their

views, comments and suggestions by 4th July, 2013. The

Commission shall finalise the Order after taking a view on the

submissions received from the stakeholders on the Draft Order.

Jaipur,dated the 7th June,2013.

(S. Dhawan)

Member

(S.K. Mittal)

Member

(D.C. Samant)

Chairman

TARIFF DETERMINATION FOR SOLAR PHOTO VOLTAIC POWER PLANTS LOCATED IN RAJASTHAN

Levelised Tariff (Rs/kWh) without AD 8.15

Accelerated Depreciation benefit(Rs/kWh) 0.99

Levelised Tariff (Rs/kWh) with AD 7.16

S. No.Assumption

HeadSub-Head Sub-Head (2) Unit

Base Case

(SPV)

1 Power Generation

Capacity

Installed Power Generation Capacity MW 1

CUF % 20.00%

Deration p.a. after 2nd year % 0.50%

Auxiliary Consumption % 0.25%

Tariff Period Years 25

Life of Power Plant Years 25

2 Project Cost

Capital Cost/MW Including Land & Connectivity charges Rs Lakh/MW 760

3 Sources of Fund

Debt: Equity

Debt % 70.00%

Equity % 30.00%

Total Debt Amount Rs Lakh 532.00

Total Equity Amout Rs Lakh 228.00

Funding Options-1 (Domestic Loan Source-1)

Loan Amount Rs Lakh 532.00

Moratorium Period years 0

Repayment Period(incld Moratorium) years 12

Intrest Rate % 13.00%

Funding Options-2 ( Equity Finance )

Equity amount Rs Lakh 228

Return on Equity % p.a 16.00%

Discount Rate (CERC Notification 1.04.13) 13.10%

4 Financial Assumptions

Fiscal Assumptions

Income Tax (11th year onwards) % 30.90%

MAT Rate (for yr-1) % 20.01%MAT Rate (for yr-2 ) % 19.06%

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

80 IA benefits Yes/No Yes

Depreciation

Depreciation Rate(upto 12-yrs) % 5.28%

Depreciation Rate(after 12-yrs) % 2.05%

Years for 5.28% SLM rate years 12

5 Working Capital

For Fixed Charges

O&M Charges Months 1

Maintenance Spare (% of O&M expenses) 15.00%

Receivables for Debtors Months 1.5

Intrest On Working Capital % 12.50%

6 Operation & Maintenance Expenses

Power plant Rs Lakh per MW Rs Lakh/MW 11.63

Insurance charges % of depreciated capital cost % 0.30%

O & M Expenses Escalation % 5.72%

Annexure-1

TARIFF DETERMINATION FOR SOLAR PHOTO VOLTAIC POWER PLANTS LOCATED IN RAJASTHAN1 0.884 0.782 0.691 0.611 0.540 0.478 0.422 0.374 0.330 0.292 0.258 0.228 0.202 0.178 0.158 0.140 0.123 0.109 0.096 0.085 0.075 0.067 0.059 0.052

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

Aux Consumption % 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%

Installed 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

Deration factor % 0.50% 1 1.000 0.995 0.990 0.985 0.980 0.975 0.970 0.966 0.961 0.956 0.951 0.946 0.942 0.937 0.932 0.928 0.923 0.918 0.914 0.909 0.905 0.900 0.896 0.891

Generation MU 1.75 1.75 1.74 1.73 1.72 1.71 1.70 1.70 1.69 1.68 1.67 1.66 1.65 1.65 1.64 1.63 1.62 1.61 1.60 1.60 1.59 1.58 1.57 1.57 1.56

Cost of 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

O&M Expenses Rs Lacs 13.91 14.45 15.04 15.66 16.33 17.04 17.79 18.60 19.46 20.38 21.36 22.40 23.50 24.75 26.08 27.48 28.97 30.54 32.21 33.97 35.84 37.81 39.91 42.12 44.46

Depreciation Rs Lacs 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 15.57 15.57 15.57 15.57 15.57 15.57 15.57 15.57 15.57 15.57 15.57 15.57 15.57

Interest on term loan Rs Lacs 66.28 60.52 54.75 48.99 43.23 37.46 31.70 25.94 20.17 14.41 8.65 2.88 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

Interest on working Capital Rs Lacs 3.05 2.97 2.91 2.84 2.78 2.72 2.67 2.61 2.56 2.51 2.58 2.54 2.15 2.21 2.27 2.34 2.40 2.47 2.55 2.63 2.72 2.81 2.90 3.00 3.11

Return on Equity Rs Lacs 45.60 45.07 45.07 45.07 45.07 45.07 45.07 45.07 45.07 45.07 52.79 52.79 52.79 52.79 52.79 52.79 52.79 52.79 52.79 52.79 52.79 52.79 52.79 52.79 52.79

Total Cost of generation Rs Lacs 168.97 163.14 157.89 152.69 147.53 142.42 137.35 132.34 127.39 122.49 125.51 120.74 94.03 95.33 96.72 98.18 99.74 101.38 103.12 104.97 106.92 108.99 111.17 113.49 115.94

Per unit Cost of generation Rs/kWh 9.67 9.33 9.08 8.82 8.57 8.31 8.06 7.80 7.55 7.30 7.51 7.26 5.69 5.79 5.91 6.03 6.15 6.29 6.43 6.57 6.73 6.89 7.07 7.25 7.44

Levellised cost of generation (Rs/kWh) (25 yrs) 8.15

Note(s):

1. Levellised tariff has been worked out by carrying out levelisation over 25 years and Discount Rate has been considered as 13.10% as per CERC Notification 1.04.13.

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

Annexure-1…contd…

Determination of Accelerated Depreciation Benefit for Solar PV Power Projects

Depreciation amount 90%

Book Depreciation rate 5.28%

Tax Depreciation rate 80%

Additional depreciation rate

applicable during first year20%

Income Tax 32.45% 30.90%

Capital Cost 760.0 Rs Lakh/MW

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 20.06 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 40.13 21.89 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Accelerated Depreciation

Opening % 100.00% 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%

Allowed during the year % 50% 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 380.00 342.00 30.40 6.08 1.22 0.24 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 0.00 0.00 0.00 0.00 0.00

Net Depreciation Benefit Rs Lakh 359.94 301.87 (9.73) (34.05) (38.91) (39.88) (40.08) (40.12) (40.13) (40.13) (40.13) (40.13) (40.13) (40.13) (40.13) (40.13) (40.13) (21.89) 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Tax Benefit Rs Lakh 116.78 93.28 (3.01) (10.52) (12.02) (12.32) (12.38) (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 0.87 1.75 1.74 1.73 1.72 1.71 1.70 1.70 1.69 1.68 1.67 1.66 1.65 1.65 1.64 1.63 1.62 1.61 1.60 1.60 1.59 1.58 1.57 1.57 1.56

Per unit benefit Rs/Unit 13.36 5.34 (0.17) (0.61) (0.70) (0.72) (0.73) (0.73) (0.73) (0.74) (0.74) (0.75) (0.75) (0.75) (0.76) (0.76) (0.76) (0.42) 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Discounting Factor,DF 1.00 0.88 0.78 0.69 0.61 0.54 0.48 0.42 0.37 0.33 0.29 0.26 0.23 0.20 0.18 0.16 0.14 0.12 0.11 0.10 0.09 0.08 0.07 0.06 0.05

Applicable DF 1.00 0.94 0.83 0.74 0.65 0.58 0.51 0.45 0.40 0.35 0.31 0.28 0.24 0.22 0.19 0.17 0.15 0.13 0.12 0.10 0.09 0.08 0.07 0.06 0.06

Levellised AD benefit 0.99 Rs/kWh

Note(s):

1. In the above calculations, depreciation for the first year has been considered as 50%(=50% of (80%+20%) and for second year as 90%(=80%+50% of 20%) as per CERC methodology.

2. Generation for the first year has been considered as 50% of normative generation for second half of the financial year.


TARIFF DETERMINATION FOR SOLAR THERMAL POWER PLANTS LOCATED IN RAJASTHAN

Levellised Tariff (Rs/kWh) without AD 11.37

Accelerated Depreciation benefit (Rs/kWh) 1.40

Levellised Tariff (Rs/kWh) with AD 9.97

S. No.Assumption

HeadSub-Head Sub-Head (2) Unit

Base

Case

(CSP)

1 Power Generation

Capacity

Installed Power Generation Capacity MW 1

CUF % 23.00%

Deration p.a. after 4th year % 0.25%

Auxiliary Consumption % 6.50%

Tariff Period Years 25

Life of Power Plant Years 25

2 Project Cost

Capital Cost/MW Including Land & Connectivity charges Rs Lakh/MW 1180

Connectivity Charges Rs Lacs/MW 2

3 Sources of Fund

Debt: Equity

Debt % 70.00%

Equity % 30.00%

Total Debt Amount Rs Lakh 826

Total Equity Amout Rs Lakh 354

Funding Options-1 (Domestic Loan Source-1)

Loan Amount Rs Lakh 826

Moratorium Period years 0

Repayment Period(incld Moratorium) years 12

Interest Rate % 13.00%

Funding Options-2 ( Equity Finance )

Equity amount Rs Lakh 354

Return on Equity % p.a 16.00%

Discount Rate (CERC Notification 1.04.13) 13.10%

4 Financial Assumptions

Fiscal Assumptions

Income Tax (11th year onwards) % 30.90%

MAT Rate (for yr-1) % 20.01%

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

80 IA benefits Yes/No Yes

Depreciation

Depreciation Rate(upto 12-yrs) % 5.28%

Depreciation Rate(after 12-yrs) % 2.05%

Years for 5.28% SLM rate 12

5 Working Capital Requirement

O&M Expenses Months 1

Maintenance Spare (% of O&M expenses) 15.00%

Receivables from Debtors Months 1.5

Interest On Working Capital % 12.50%

6 Operation & Maintenance Expenses

Power plant Rs Lakh per MW Rs Lakh/MW 15.86

Insurance charges % of depreciated capital cost % 0.30%

O & M Expenses Escalation % 5.72%

Annexure - 2

TARIFF DETERMINATION FOR SOLAR THERMAL POWER PLANTS LOCATED IN RAJASTHAN

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

Aux Consumption % 6.5% 6.5% 6.5% 6.5% 6.5% 6.5% 6.5% 6.5% 6.5% 6.5% 6.5% 6.5% 6.50% 6.50% 6.50% 6.50% 6.50% 6.50% 6.50% 6.50% 6.50% 6.50% 6.50% 6.50% 6.50%

Deration factor % 1.000 1.000 1.000 1.000 0.998 0.995 0.993 0.990 0.988 0.985 0.983 0.980 0.978 0.975 0.973 0.970 0.968 0.966 0.963 0.961 0.958 0.956 0.954 0.951 0.949

Installed 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

Generation MU 1.884 1.884 1.884 1.884 1.879 1.874 1.870 1.865 1.860 1.856 1.851 1.846 1.842 1.837 1.833 1.828 1.824 1.819 1.814 1.810 1.81 1.80 1.80 1.79 1.79

Cost of 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

O&M Expenses Rs Lakh 19.40 20.12 20.89 21.72 22.60 23.55 24.56 25.64 26.79 28.02 29.33 30.72 32.21 33.91 35.70 37.61 39.62 41.76 44.02 46.42 48.95 51.64 54.49 57.50 60.69

Depreciation Rs Lakh 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 24.18 24.18 24.18 24.18 24.18 24.18 24.18 24.18 24.18 24.18 24.18 24.18 24.18

Interest on term loan Rs Lakh 102.91 93.96 85.01 76.06 67.11 58.16 49.22 40.27 31.32 22.37 13.42 4.47 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

Interest on working Capital Rs Lakh 4.63 4.51 4.40 4.30 4.19 4.09 4.00 3.91 3.82 3.73 3.84 3.76 3.15 3.23 3.31 3.40 3.49 3.59 3.69 3.80 3.91 4.03 4.16 4.30 4.45

Return on Equity Rs Lakh 70.81 69.97 69.97 69.97 69.97 69.97 69.97 69.97 69.97 69.97 81.97 81.97 81.97 81.97 81.97 81.97 81.97 81.97 81.97 81.97 81.97 81.97 81.97 81.97 81.97

Total Cost of generation Rs Lakh 260.04 250.86 242.58 234.35 226.19 218.08 210.05 202.09 194.20 186.40 190.86 183.23 141.51 143.28 145.16 147.15 149.26 151.49 153.86 156.36 159.02 161.83 164.80 167.95 171.28

Per unit Cost of generation Rs/kWh 13.80 13.32 12.88 12.44 12.04 11.63 11.23 10.84 10.44 10.04 10.31 9.92 7.68 7.80 7.92 8.05 8.19 8.33 8.48 8.64 8.81 8.99 9.17 9.37 9.58

Levellised Tariff (Rs/kWh) (25 yrs) 11.37

Note(s)

1. Levellised tariff has been worked out by carrying out levelisation over 25 years and Discount Rate has been considered as 13.10% as per CERC Notification 1.04.13


Determination of Accelerated Depreciation Benefit for Solar Thermal Power Projects

Depreciation amount 90%

Book Depreciation rate 5.28%

Tax Depreciation rate 80%

Additional depreciation rate

applicable during first year20%

Income Tax 32.45% 30.90%

Capital Cost 1180.0 Rs Lakh/MW

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 Lacs 31.15 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 62.30 33.98 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Accelerated Depreciation

Opening % 100.00% 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%

Allowed during the year % 50% 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% 5% 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 590.00 531.00 47.20 9.44 1.89 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 558.85 468.70 (15.10) (52.86) (60.42) (61.93) (62.23) (62.29) (62.30) (62.30) (62.30) (62.30) (62.30) (62.30) (62.30) (62.30) (62.30) (33.98) 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Tax Benefit Rs Lakh 181.32 144.83 (4.67) (16.33) (18.67) (19.14) (19.23) (19.25) (19.25) (19.25) (19.25) (19.25) (19.25) (19.25) (19.25) (19.25) (19.25) (10.50) 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Energy generation MU 0.94 1.88 1.88 1.88 1.88 1.87 1.87 1.87 1.86 1.86 1.85 1.85 1.84 1.84 1.83 1.83 1.82 1.82 1.81 1.81 1.81 1.80 1.80 1.79 1.79

Per unit benefit Rs/Unit 19.25 7.69 (0.25) (0.87) (0.99) (1.02) (1.03) (1.03) (1.03) (1.04) (1.04) (1.04) (1.05) (1.05) (1.05) (1.05) (1.06) (0.58) 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Discounting Factor,DF 1.00 0.88 0.78 0.69 0.61 0.54 0.48 0.42 0.37 0.33 0.29 0.26 0.23 0.20 0.18 0.16 0.14 0.12 0.11 0.10 0.09 0.08 0.07 0.06 0.05

Applicable DF 1.00 0.94 0.83 0.74 0.65 0.58 0.51 0.45 0.40 0.35 0.31 0.28 0.24 0.22 0.19 0.17 0.15 0.13 0.12 0.10 0.09 0.08 0.07 0.06 0.06

Levellised AD benefit 1.40 Rs/kWh

Note(s)

1. In the above calculations, depreciation for the first year has been considered as 50%(=50% of (80%+20%)) and for second year as 90%(=80% + 50% of 20%) as per CERC methodology.

2. Generation for the first year has been considered as 50% of normative generation for second half of the Financial Year.

3. Figures may not tally excatly on account of rounding off.

C:\Users\GSV\Desktop\Draft_Solar _TO_13_14\Draft_Solar-Order_13_14\Pub_notice - solar_tariff(English).doc

Rajasthan Electricity Regulatory Commission Vidyut Viniyamak Bhawan, Near State Motor Garage, Sahkar Marg, JAIPUR -302001

Phone: EPBX 0141-2741299, Fax: 0141-2741018

Website: www.rerc.rajasthan.gov.in E-mail: [email protected]

PUBLIC NOTICE

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

Electricity Act,2003 for determination of Bench Mark Capital Cost for Solar PV and Solar Thermal

Projects and resultant Generic levellised Tariff. The resultant Generic levellised tariff is proposed

as under:

S.No. Particulars

Tariff

(Rs/kWh)

if AD

benefit is

not availed

Tariff

(Rs/kWh)

if AD

benefit is

availed

1 2 3 4

1 Solar Photo Voltaic (PV) Power Plants commissioned by

31.3.2015

8.15 7.16

2 Solar Thermal Power Plants commissioned by 31.3.2016 11.37 9.97

3 Roof Top Solar PV installations and other small solar PV

power generation plants to be commissioned by 31.3.2015

8.15 7.16

4 Small Solar Thermal Power generation plants to be


11.37 9.97

The above tariff is levellised for 25 years.

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

may do so in five copies, so as to reach this office by 4th July, 2013 with copies of supporting

details. The suggestions/comments can also be sent to the Commission through e-mail at

[email protected]. The copy of the draft order is also available with the Receiving Officer of

the Commission and can be obtained on payment of Rs 100/-. The draft order is also available

on Commission’s website www.rerc.rajasthan.gov.in. The hearing in the matter shall be held on

16th July, 2013 at 11.30 AM in RERC’s office, Jaipur. Persons giving suggestions/comments by the

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

(G.K.Sharma)

Secretary

(Not to be published)

(G.K.Sharma)

Secretary

jktLFkku fo|qr fofu;ked vk;ksx fo|qr fofu;ked Hkou] LVsV eksVj xsjst ds ikl] lgdkj ekxZ] t;iqj&302001

nwjHkk"k % 0141&2741299 QSDl % 0141&2741018 bZ&esy : [email protected]

website: www.rerc.rajasthan.gov.in

lkoZtfud lwpuk

fo|qr vf/kfu;e] 2003 esa lwfpr /kkjk 64 ¼2½ lgifBr /kkjk 61¼h½] 62 ¼1½ ¼a½ ,oa /kkjk 86 ¼1½ ¼e½ ds

vUrZxr lkSj QksVks&oksfYVd ,oa lkSj rkih; ifj;kstukvksa dh cSapekdZ iwathxr ykxr rFkk ifj.kkeh tkfrxr

lerfyr VSfjQ fofu/kkZfjr dh tkuh gSA izkLrkfor tkfrxr lerfyr VSfjQ fuEu izdkj ls gS%&

Ø-la- fooj.k VSfjQ

¼:-@fdok?k½ Rofjr

âkl dk ykHk ugha

ysus ij

VSfjQ

¼:-@fdok?k½

Rofjr âkl dk

ykHk ysus ij

1. 2- 3- 4-

2. lkSj QksVks&oksfYVd ¼PV½ fo|qr ÅtkZ la;a= tks fnukad

31-03-2015 rd pkyw gks ldsaA

8-15 7-16

3. lkSj rkih; fo|qr ÅtkZ la;a= tks fnukad 31-03-2016 rd

pkyw gks ldsaA

11-37 9-97

4. Nr ij lkSj QksVks&oksfYVd la;a= rFkk vU; y?kq lkSj

QksVks&oksfYVd mRiknu la;a= tks fnukad 31-03-2015 rd

pkyw gks ldsaA

8-15 7-16

5. Yk?kq lkSj rkih; ÅtkZ mRiknu la;a= tks fnukad 31-03-2016

rd pkyw gks ldsaA

11-37 9-97

mijksDRk VSfjQ 25 o"kkZs ds fy, lerfyr gSA

dksbZ Hkh O;fDRk tks Åij of.kZr VSfjQ izLrko ij lq>ko nsuk pkgrk gS rks ik¡p izfrfyfi;ksa esa e; leFkZd

fooj.k ,oa ’kiFk i= ds lkFk vk;ksx dks fnukad 4 tqykbZ ] 2013 rd Hkst ldrk gSA lq>ko vk;skx dks bZ&esy

ds ek/;e ls [email protected] ij Hkh Hksts tk ldrs gSA izk:Ik vkns’k dh izfrfyih vk;ksx ds izkIrdrkZ

vf/kdkjh ds ikl Hkh miyC/k gS ftls :- 100 dk Hkqxrku ns dj izkIr dh tk ldrh gSA izLrkfor vkns’k vk;ksx

dh oSclkbZV www.rerc.rajasthan.gov.in ij Hkh miyC/k gSaA ekeys esa lquokbZ 16 tqykbZ ] 2013 dks

lqcg 11-30 cts vk;ksx ds dk;kZy;] t;iqj esa dh tk;sxhA fu;r fnukad rd lq>ko nsus okys ,oa O;fDr’k%

lquokbZ ds bPNqd O;fDr] mDr lquokbZ ds nkSjku ,slk dj ldsaxsA

¼th +d¢+ 'kekZ ½

lfpo

________________________________________________________________________ ¼Not to be published½

¼th +d¢+ 'kekZ½

lfpo

rajasthan electricity regulatory …rerc.rajasthan.gov.in/cnpl/pdfs/solar.pdfpage 1 of 15 rajasthan...

Documents