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7/30/2019 Draft Wind Tariff FY 13-14
1/17
RAJASTHAN ELECTRICITY REGULATORY COMMISSION,JAIPUR
In the matter of determination of generic tariff for sale of electricity from wind
power plants in the state to Distribution Licensee for FY 2013-14.
Coram:
1. Shri D.C. Samant, Chairman2. Shri S.K.Mittal, Member3. Shri S.Dhawan, Member
Draft Order
1. As per RERC (Terms and Conditions for Determination of Tariff)Regulations, 2009 (hereinafter called as RERC Tariff Regulations, 2009),
Commission may initiate process for determination of generic tariff for
Renewable Energy (RE) generating stations on Suo-Motu basis or on the
basis of Petition filed by the Nodal Agency. Commission, through this
order, contemplates to determine tariff for wind power plants on Suo-
Motu basis.
2. The RERC Tariff Regulations,2009 provide for terms and conditions fordetermination of generic tariff for wind power projects to be
commissioned during the Control Period of FY 2009-10 to FY 2013-14,
based on the parameters outlined in Part VII of these Regulations.
Commission has finalised Fourth Amendment in Tariff Regulations, 2009
vide Notification dated.18.05.2012. The amended regulation 83(6) of
the Tariff Regulations, 2009 provides that Commission shall determine
the Capital cost for wind power plants for FY 2013-14 through a
separate Order.
3. Commission, therefore, based on the benchmark capital cost for windpower plants for FY 2013-14 and performance parameters contained in
the RERC Tariff Regulations 2009 read with the said Fourth Amendment,
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proposes to determine the generic tariff for the wind power projects
getting commissioned during FY 2013-14 as briefly discussed and given
in Appendix and Annexures to the Appendix.
4. Comments/suggestions of the stakeholders on the above proposal areinvited by 25th March ,2013.
Jaipur, dated the 1st March , 2013.
(S. Dhawan)
Member
(S.K. Mittal)
Member
(D.C. Samant)
Chairman
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The levelised generic tariff for wind power projects for FY 2013-14.
1. The levelised generic tariff for wind power plants, getting commissionedduring FY 2013-14, has been worked out based on operational and
performance parameters as specified under Regulation 83(6) of RERC
Tariff Regulations, 2009 and the Financial Principles as stipulated under
Part III of RERC Tariff Regulations, 2009, read with Fourth Amendment
dated 18.05.2012. The parameters adopted in this order have been
discussed in the following sub-paras.
Capital Cost
2. Commission had determined Capital cost of Rs. 530 Lacs/MW, whichincludes Rs. 15 Lacs/MW towards the cost of wind energy evacuation
upto and including pooling station and Rs. 2 Lacs/MW payable to
Rajasthan Rajya Vidyut Prasaran Nigam Ltd for connectivity charges for
FY 2012-13. The regulation 83(6) of the Amended Regulations also
provides that Commission shall determine the Capital cost for wind
power plants for FY 2013-14 through a separate Order.
3. It may be mentioned that CERC had undertaken a fresh exercise todetermine the capital cost of wind energy projects getting
commissioned in FY 12-13. The capital cost of the previous two years
for the wind projects was determined by Central Electricity Regulatory
Commission (Terms and Conditions for Tariff Determination from
Renewable Energy Sources) Regulations, 2009. Based on the said fresh
exercise for determination of the capital cost of wind projects, CERC
specified a capital cost of Rs. 575 Lacs/MW in the new tariff Regulations
namely Central Electricity Regulatory Commission (Terms and
Conditions for Tariff Determination from Renewable Energy Sources)
Regulations, 2012 for the wind power plants getting commissioned in FY
12-13. In the new Regulation, CERC has also specified a capital cost
indexation methodology to determine capital cost of wind projects for
the subsequent years of their control period.
Appendix
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4. The State Commission had also undertaken a similar fresh exercise fordetermining the capital cost of the wind power plants getting
commissioned in FY 12-13 for determination of tariff for FY 12-13 as
against determination of tariff of previous two years on the basis of
indexation methodology given in Regulation, which was subsequently
amended vide notification dated 18.05.2012
5. CERC, for the following year i.e. FY 13-14, have worked out thenormative capital cost of wind energy projects as Rs. 595.9 Lacs/MW by
adopting the indexation formula specified in their Regulations as given
in the Draft Tariff Order of CERC dated 25.10.2012. Thus, CERC after
determining the capital cost for FY 12-13, are using a formula based on
WPI data of change in prices of Electrical Machinery and Steel for
determination of capital cost for FY 13-14.
6. Commission has given due consideration to the methodology to beadopted for working out normative capital cost for the wind projects
getting commissioned in FY 13-14. As the capital cost has already
been determined afresh in FY 12-13 in consonance with a similar
exercise undertaken by CERC for FY 12-13; the Commission deems it
appropriate to adopt the same methodology for working out variation
in capital cost for the next year, in relation to cost of FY 12-13 as is
being used by CERC based on their Regulations.
7. It may be mentioned that Draft Tariff order of CERC dated 25.10.2012envisages an increase of 3.65% in capital cost for FY 13-14 as against
the benchmark capital cost of FY 12-13. However, CERC has used WPI
data available upto July, 2012 in the said Draft Order in respect of
prices of Electrical Machinery and Steel.
8. However, the WPI data for Electrical Machinery and Steel have nowbecome available up to December 2012. Considering the same, the
rise works out to be 3.95% as against 3.65% considered by CERC in theirdraft Order.
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9. Accordingly, considering a rise of 3.95%, the capital cost of Rs. 530Lacs/MW specified by the Commission for FY 2012-13, works out to be
Rs. 550.94 Lacs/MW for FY 2013-14.
10. In light of the position discussed above, Commission considers itappropriate to adopt a capital cost of Rs. 550 Lacs/MW for wind
power plants getting commissioned during FY 2013-14, which shall
include Rs. 15 Lacs/MW towards the cost of wind energy evacuation
upto and including pooling station and Rs. 2 Lacs/MW payable
towards connectivity charges.
Debt-Equity Ratio
11. The Debt-Equity ratio of 70:30 as envisaged at regulation 17 of RERCTariff Regulations 2009 has been taken for working out the debt and
equity components of normative capital cost for determination of
levelised generic tariff.
Capacity Utilisation Factor (CUF) & de-ration in CUF
12. Regulation 83(6)(b)(ii) of RERC Tariff Regulations 2009 provides for CUFof 21% for Jaisalmer, Jodhpur and Barmer districts and 20% for other
districts. Further, regulation 83(6)(b)(iii) also stipulates a de-ration of
1.25% from 6th ,10th, 14th & 18th year in the above CUFs. Accordingly,
CUFs along with de-ration have been taken.
Operation & Maintenance Expenses
13. O&M expenses have been taken as 1.25% of capital cost for powerplant and 3% of cost of transmission line in accordance with Regulation
83 (6)(b)(iv) of RERC Tariff Regulations,2009.
Depreciation
14. In accordance with regulation 83(6)(b)(vi), the rate of the depreciationhas been considered as 5.28% of the total project cost for the first 12
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years and remaining depreciable value has been spread over the
balance useful life of the power project and transmission system.
Interest rate on long term loan and Interest on working capital requirement
15. In line with regulation 83(6)(b)(viii), the interest rate on long term loanshas been taken as 300 basis points higher than the average SBI base
rate prevalent during first six months of FY 12-13 . The average SBI base
rate for first six months of FY 2012-13 is 10.00%. Accordingly, the interest
rate of 13.00% (=10.00%+3.00%) has been taken for long term loan.
16. The repayment of loan has been taken equal to the depreciationallowed for that year as stipulated at regulation 22(3) of RERC Tariff
Regulations, 2009.
17. For the purpose of working capital requirement, the composition ofworking capital has been taken as per regulation 83(6)(b)(vii).
18. In line with regulation 83(6)(b)(vii), the interest on working capital forwind power plants has been taken as 250 basis points higher than the
average SBI base rate prevalent during first six months of FY 12-13,
which works out to be 12.50% (=10.00%+2.50%). Accordingly, a rate of
12.50% has been taken as interest rate on working capital
requirements.
Return on Equity
19. Regulation 21 provides for 16% Return on Equity base of 30%determined in accordance with regulation 17. As per regulation 21,
return on equity has been computed by grossing up the base rate of
16% with tax rate equivalent to Minimum alternate Tax (MAT) for first 10
years from COD and normal tax rate for remaining years of the project
life. The MAT rate of 20.01% (= 18.50% MAT rate+5% surcharge + 3%
education cess) has been considered for first year and a MAT rate of
19.06% (= 18.5% MAT rate + 3% education cess) has been considered
7/30/2019 Draft Wind Tariff FY 13-14
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for remaining 9 years of the first 10 years. For remaining 15 years of
project life (also equal to useful life), the normal tax rate of 30.90% (=
30% tax rate + 3% education cess) has been applied for grossing up of
Return on Equity.
Subsidy or incentive by the Central Government, including Higher
Depreciation
20. The Generation Based Incentive/Tariff Subsidy, allowed by the CentralGovt. would be governed by the terms and conditions of such
scheme.
21. As regards impact of higher depreciation admissible to wind energyprojects, the methodology as adopted in the Tariff Order dated
7.09.2012 for the wind power plants getting commissioned in FY 12-13
has been followed in this draft order also. Similarly, capitalization as
well as availability of energy in the second half of the year has been
taken exactly as was done for FY 12-13. The following paragraph
elaborates on the said points.
22. Vide GoI Notification No. 15/2012 (F. No. 149/21/2010-SO (TPL)] S.O.694(E) dated 30.03.2012, depreciation has been restricted to 15% for wind
power plants installed after 31.03.2012. However, in addition to this, an
additional depreciation of 20% has been allowed to the wind power
projects during the first year in a recent amendment in the Finance
Act, 2012. Both these rates have been considered in computing
income tax benefit as given at Annexures-I and II. In this computation,the methodology of taking capitalization during the second half of the
year, as has been followed by CERC for working out the benefit of
accelerated depreciation has been applied. The energy available in
the second half of the year has been taken as 30% of annual
generation. The levelised generic tariff has been worked out
considering both the situations viz. if higher depreciation benefit is
availed and if not availed.
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Tariff period and Levelised Tariff
23. The levelised tariff has been determined for the useful life of the windpower projects i.e. for 25 years as per note (ii) of regulation 83(6)(b)(viii)
of RERC Tariff Regulations 2009. Therefore, the PPA should also be for 25
years.
24. In light of the above position, the levelised generic tariff for wind powerplant for FY 2013-14 has been determined as under:
Table: Tariff for wind power plants getting commissioned during FY 13-14
S.
No.Particulars
Tariff (Rs./kWh)
if higherdepreciation
benefit is not
availed
Tariff (Rs./kWh) if
higherdepreciation
benefit is
availed
1 2 3 4
1 Wind Power Plants located
in Jaisalmer, Jodhpur &
Barmer districts
5.48 5.17
2 Wind Power Plants located
in districts other than
Jaisalmer, Jodhpur &Barmer districts.
5.75 5.43
25. A generator claiming the higher tariff worked out as above for projectsnot availing higher depreciation benefit would have to furnish an
undertaking in advance to the buyer regarding higher depreciation
benefit not being availed and this would have to be followed for each
financial year. Similarly, annual undertaking would need to be
furnished if CDM benefit is not availed. However, if CDM benefit is
availed, it would have to be shared with distribution licensee as
envisaged in applicable Regulations.
26. The detailed calculations for determination of tariff are annexed asunder:
(1) Tariff determination of Wind Energy Power Plant - Annexure-Ilocated in Jaisalmer, Jodhpur & Barmer districts
7/30/2019 Draft Wind Tariff FY 13-14
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(2) Tariff determination of Wind Energy Power Plant - Annexure-IIlocated in districts other than Jaisalmer,Jodhpur
& Barmer districts
****************
7/30/2019 Draft Wind Tariff FY 13-14
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TARIFF FOR WIND POWER PLANTS LOCATED IN JAISALMER,BARMER & JODHPUR DISTRICTS
Annexure-I
5.47
5.
0.31
5.16
5.
Case Select Option 1
S. No.Assumption
HeadSub-Head Sub-Head (2) Unit Base Case
1 Power Generation
Capacity
Installed Power Generation Capacity MW
CUF % 21
Life of Transmission system Years
Life of Power Plant Years
2 Project Cost
Capital Cost/MW inc Land,Trans &Connectivity charges(Rs 2 Lacs) Rs Lacs/MW 5Project Cost Power Plant Cost Rs Lacs 5
Tranmssion line Cost Rs Lacs/MW
3 Sources of FundsDebt: Equity
Debt % 70
Equity % 30
Total Debt Amount Rs Lacs 3
Total Equity Amout Rs Lacs 1
Funding Options-1 (Domestic Loan Source-1)
Loan Amount Rs Lacs 3
Moratorium Period years
Intrest Rate % 13.00
Funding Options-2 ( Equity Finance )
Equity amount Rs Lacs 1
Return on Equity % p.a 16.00
Discount Rate (equiv. to WACC) 13.90
4 Financial Assumptions
Fiscal Assumptions
Income Tax % 30.90
MAT Rate (for yr-1) % 20.01
MAT Rate (for yr-2 to yr-10) % 19.06
80 IA benefits Yes/No Y
Higher Depreciation Rs/kWh 0.
Depreciation
Depreciation Rate(power plant) % 5.28
Depreciation Rate(Transmission) % 5.28
Years for 5.28% rate
5 Working Capital Requirement
O&M Charges Months
Maintenance Spare (% of O&M exepenses) % 15
Receivables for Debtors Months 1
Intrest On Working Capital % 12.50
6 Operation & Maintenance Expenses
power plant % of capital cost % 1.25
Transmission lines % of transmission line cost % 3.0
Total O & M Expenses Escalation % 5.72
Months of Operations MU
Working Hours/Day Hrs
No. of Days Days 3
Total No. of Hours Hrs 87
Levelised Tariff (Rs/kWh) without HD
Higher Depreciation benefit(Rs/kWh)
Levelised Tariff (Rs/kWh) with DD
Levelised Tariff (Rs/kWh) with HD (Rounding off)
Levelised Tariff (Rs/kWh) without HD(Rounding off)
7/30/2019 Draft Wind Tariff FY 13-14
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TARIFF FOR WIND POWER PLANTS LOCATED IN JAISALMER,BARMER & JODHPUR DISTRICTS Annexure-I contd
Units Generation Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24D er at io n i n c ap ac it y % 0% 0% 0% 0% 0% 1.25% 1.25% 1.25% 1.25% 2.50% 2.50% 2.50% 2.50% 3.75% 3.75% 3.75% 3.75% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00Installed Capacity MW 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1
Generation MU 1.84 1.84 1.84 1.84 1.84 1.82 1.82 1.82 1.82 1.79 1.79 1.79 1.79 1.77 1.77 1.77 1.77 1.75 1.75 1.75 1.75 1.75 1.75 1.75
Cost of generat ion Uni t Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24O&M Ex pens es Rs Lakh 7.14 7.55 7.98 8.43 8.92 9.43 9.97 10.54 11.14 11.77 12.45 13.16 13.91 14.71 15.55 1 6.44 17.38 18.37 19.43 20.54 21.71 22.95 2 4.27 25. 6
D ep re ci at io n Rs L ak h 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9 .0 4 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 1 1. 14 1 1. 14 1 1. 14 1 1 .1 4 1 1 .1 4 1 1. 14 1 1. 14 1 1. 14 1 1. 14 1 1. 14 1 1 .1 4 1 1. 1
Interest on term loan Rs Lakh 48.16 44.39 40.61 36.84 33.06 29.29 25.51 21.74 17.96 14.19 10.41 6.64 4.02 2.58 1.13 0.20 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Interest on working Capital Rs Lakh 2.07 2.03 1.99 1.95 1.91 1.87 1.84 1.80 1.77 1.74 1.80 1.77 1.48 1.49 1.51 1.53 1.57 1.62 1.67 1.72 1.77 1.83 1.89 1.95
Return on Equity Rs Lakh 33.00 32.61 32.61 32.61 32.61 32.61 32.61 32.61 32.61 32.61 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38. 2
Total Cost of generat ion Rs Lakh 119.42 115.61 112.23 108.87 105.54 102.24 98.97 95.73 92.52 89.35 91.90 88.81 68.76 68.12 67.53 67.52 68.30 69.34 70.44 71.60 72.83 74.12 75.50 76.9
Per unit Cost of generation Rs/kWh 6.49 6.28 6.10 5.92 5.74 5.63 5.45 5.27 5.09 4.98 5.12 4.95 3.83 3.85 3.81 3.81 3.86 3.97 4.03 4.10 4.17 4.24 4.32 4.40
Levellised Tariff (Rs/kWh) 5.48 25 years
Note(s):
1.Levelised tariff has been worked out by carrying out levelisation over 25 years and with normative debt equity ratio (70:30). Discounting rate equivalent to weighted average cost of capital i.e.13.90% (=0.7x 13.00%+0.3*16.0%) has been considered.
2. Figures may not tally exactly on account of rounding of .
7/30/2019 Draft Wind Tariff FY 13-14
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Determination of Higher Depreciation Benefit for Wind Power Projects
Depreciation amount 90% Annexure-I contd...
B oo k De pr ec ia ti on r at e 5 .2 8%
Tax Depreciation rate 15%
Additional depreciation rate
applicable during first year
20%
Income Tax 32.45% 30.90%
Capital Cost 550.00 Rs Lacs/MW
Year(s)--> Unit 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Book Depreciation % 2.64% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 2.88%
Book Depreciati on Rs Lacs 1 4. 52 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9 .0 4 2 9. 04 2 9. 04 2 9 .0 4 29 .0 4 2 9. 04 1 5 .8 4 0 .0 0 0 .0 0 0 .0 0 0 .0 0 0. 00 0 .0 0
Higher Depreciation Benefit
Opening balance % 100.00% 82.50% 70.13% 59.61% 50.67% 43.07% 36.61% 31.11% 26.45% 22.48% 19.11% 16.24% 13.81% 11.73% 9.97% 8.48% 7.21% 6.13% 5.21% 4.43% 3.76% 3.20% 2.72% 2.31% 1.
Allowed during the year % 17.50% 12.38% 10.52% 8.94% 7.60% 6.46% 5.49% 4.67% 3.97% 3.37% 2.87% 2.44% 2.07% 1.76% 1.50% 1.27% 1.08% 0.92% 0.78% 0.66% 0.56% 0.48% 0.41% 0.35% 0.
Closing % 82.50% 70.13% 59.61% 50.67% 43.07% 36.61% 31.11% 26.45% 22.48% 19.11% 16.24% 13.81% 11.73% 9.97% 8.48% 7.21% 6.13% 5.21% 4.43% 3.76% 3.20% 2.72% 2.31% 1.96% 1.
H ig he r d ep re ci ati on Rs L ac s 96.25 68.06 57.85 49.18 41.80 35.53 30.20 25.67 21.82 18.55 15.76 1 3.40 1 1.39 9.68 8.23 6.99 5.95 5.05 4.30 3.65 3.10 2.64 2.24 1.91
Net depreciation benefit Rs Lacs 81.73 39.02 28.81 20.14 12.76 6.49 1.16 (3.37) (7.22) (10.49) (13.28) (15.64) (17.65) (19.36) (20.81) (22.05) (23.09) (10.79) 4 .30 3.65 3.10 2.64 2.24 1.91 1
Tax Benefit Rs Lacs 2 6. 52 1 2. 06 8 .9 0 6 .2 2 3 .9 4 2 .0 1 0. 36 ( 1. 04 ) ( 2. 23 ) ( 3. 24 ) ( 4. 10 ) (4 .8 3) ( 5.4 5) ( 5. 98 ) (6 .4 3) ( 6.8 1) ( 7. 14 ) (3 .3 3) 1 .3 3 1 .1 3 0 .9 6 0 .8 2 0 .6 9 0 .5 9 0
D is co unt ed T ax Be ne fit Rs L ac s 2 6. 52 1 1. 32 7 .3 4 4 .5 0 2 .5 1 1 .1 2 0. 18 ( 0. 45 ) ( 0. 84 ) ( 1. 07 ) ( 1. 19 ) (1 .2 3) ( 1.2 2) ( 1. 18 ) (1 .1 1) ( 1.0 3) ( 0. 95 ) (0 .3 9) 0 .1 4 0 .1 0 0 .0 8 0 .0 6 0 .0 4 0 .0 3 0
L ev el is ed t ax b ene fi t Rs L ac s 5 .1 8
Energy Generation MU 0.55 1.84 1.84 1.84 1.84 1.82 1.82 1.82 1.82 1.79 1.79 1.79 1.79 1.77 1.77 1.77 1.77 1.75 1.75 1.75 1.75 1.75 1.75 1.75 1
Discounted Generation MU 0.55 1.73 1.52 1.33 1.17 1.01 0.89 0.78 0.69 0.59 0.52 0.46 0.40 0.35 0.31 0.27 0.24 0.20 0.18 0.16 0 .14 0.12 0.11 0.09 0
Levelised generation MU 1.66
Per Unit Benefit Rs/kWh 4 .8 0 0 .6 6 0 .4 8 0 .3 4 0 .2 1 0 .1 1 0. 02 ( 0. 06 ) ( 0. 12 ) ( 0. 18 ) ( 0. 23 ) ( 0. 27 ) ( 0.3 0) ( 0. 34 ) ( 0. 36 ) ( 0.3 8) (0 .4 0) (0 .1 9) 0 .0 8 0 .0 6 0 .0 5 0 .0 5 0 .0 4 0 .0 3 0
Discount Factor 1.00 0.88 0.77 0.68 0.59 0.52 0.46 0.40 0.35 0.31 0.27 0.24 0.21 0.18 0.16 0.14 0.12 0.11 0.10 0.08 0.07 0.07 0.06 0.05
Applicable Discount Factor 1.00 0.94 0.82 0.72 0.64 0.56 0.49 0.43 0.38 0.33 0.29 0.26 0.22 0.20 0.17 0.15 0.13 0.12 0.10 0.09 0.08 0.07 0.06 0.05
Levelised ITAX benefit Rs/kWh 0.3115
Note(s):
1.In the above calculations, depreciation for the first year has been considered as 17.50%(= 50% of (15%+20%)) as per CERC methodology
3. For working out Tax benefit, income tax rate for the first year has been considered as 32.45% and a tax rate of 30.90% for subsequent years.
TARIFF FOR WIND POWER PLANTS LOCATED IN JAISALMER,BARMER & JODHPUR DISTRICTS
4. Figures may not tally exactly on account of rounding of .
2. Generation for the first year has been considered as 30% of the normative generation for the second half of the financial year.
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TARIFF FOR WIND POWER PLANTS LOCATED IN DISTRICTS OTHER THAN JAISALMER,BARMER & JODHPUR
Annexure-II
5.75
5.
0.32
5.42
5.
Case Select Option 2
S. No.Assumption
HeadSub-Head Sub-Head (2) Unit Base Case
1 Power Generation
Capacity
Installed Power Generation Capacity MW
CUF % 20
Life of Transmission system Years
Life of Power Plant Years
2 Project Cost
Capital Cost/MW inc Land,Trans &Connectivity charges(Rs 2 Lacs) Rs Lacs/MW 5Project Cost Power Plant Cost Rs Lacs 5
Tranmssion line Cost Rs Lacs/MW
3 Sources of FundsDebt: Equity
Debt % 70
Equity % 30
Total Debt Amount Rs Lacs 3
Total Equity Amout Rs Lacs 1
Funding Options-1 (Domestic Loan Source-1)
Loan Amount Rs Lacs 3
Moratorium Period years
Intrest Rate % 13.00
Funding Options-2 ( Equity Finance )
Equity amount Rs Lacs 1
Return on Equity % p.a 16.00
Discount Rate (equiv. to WACC) 13.90
4 Financial Assumptions
Fiscal Assumptions
Income Tax % 30.90
MAT Rate (for yr-1) % 20.01
MAT Rate (for yr-2 to yr-10) % 19.06
80 IA benefits Yes/No Y
Higher Depreciation Rs/kWh 0.
Depreciation
Depreciation Rate(power plant) % 5.28
Depreciation Rate(Transmission) % 5.28
Years for 5.28% rate
5 Working Capital Requirement
O&M Charges Months
Maintenance Spare (% of O&M exepenses) % 15
Receivables for Debtors Months 1
Intrest On Working Capital % 12.50
6 Operation & Maintenance Expenses
power plant % of capital cost % 1.25
Transmission lines % of transmission line cost % 3.0
Total O & M Expenses Escalation % 5.72
Months of Operations MU
Working Hours/Day Hrs
No. of Days Days 3
Total No. of Hours Hrs 87
Levelised Tariff (Rs/kWh) without HD
Higher Depreciation benefit(Rs/kWh)
Levelised Tariff (Rs/kWh) with DD
Levelised Tariff (Rs/kWh) with HD (Rounding off)
Levelised Tariff (Rs/kWh) without HD(Rounding off)
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TARIFF FOR WIND POWER PLANTS LOCATED IN DISTRICTS OTHER THAN JAISALMER,BARMER & JODHPUR Annexure-II contd
Units Generation Unit Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24D er at io n i n c ap ac it y % 0% 0% 0% 0% 0% 1.25% 1.25% 1.25% 1.25% 2.50% 2.50% 2.50% 2.50% 3.75% 3.75% 3.75% 3.75% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00Installed Capacity MW 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1
Generation MU 1.75 1.75 1.75 1.75 1.75 1.73 1.73 1.73 1.73 1.71 1.71 1.71 1.71 1.69 1.69 1.69 1.69 1.66 1.66 1.66 1.66 1.66 1.66 1.66
Cost of generat ion Uni t Year---> 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24O&M Ex pens es Rs Lakh 7.14 7.55 7.98 8.43 8.92 9.43 9.97 10.54 11.14 11.77 12.45 13.16 13.91 14.71 15.55 1 6.44 17.38 18.37 19.43 20.54 21.71 22.95 2 4.27 25. 6
D ep re ci at io n Rs L ak h 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9 .0 4 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 1 1. 14 1 1. 14 1 1. 14 1 1 .1 4 1 1 .1 4 1 1. 14 1 1. 14 1 1. 14 1 1. 14 1 1. 14 1 1 .1 4 1 1. 1
Interest on term loan Rs Lakh 48.16 44.39 40.61 36.84 33.06 29.29 25.51 21.74 17.96 14.19 10.41 6.64 4.02 2.58 1.13 0.20 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Interest on working Capital Rs Lakh 2.07 2.03 1.99 1.95 1.91 1.87 1.84 1.80 1.77 1.74 1.80 1.77 1.48 1.49 1.51 1.53 1.57 1.62 1.67 1.72 1.77 1.83 1.89 1.95
Return on Equity Rs Lakh 33.00 32.61 32.61 32.61 32.61 32.61 32.61 32.61 32.61 32.61 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38.21 38. 2
Total Cost of generat ion Rs Lakh 119.42 115.61 112.23 108.87 105.54 102.24 98.97 95.73 92.52 89.35 91.90 88.81 68.76 68.12 67.53 67.52 68.30 69.34 70.44 71.60 72.83 74.12 75.50 76.9
Per unit Cost of generation Rs/kWh 6.82 6.60 6.41 6.21 6.02 5.91 5.72 5.53 5.35 5.23 5.38 5.20 4.03 4.04 4.00 4.00 4.05 4.17 4.23 4.30 4.38 4.45 4.54 4.62
Levellised Tariff (Rs/kWh) 5.75 25 years
Note(s):
1.Levelised tariff has been worked out by carrying out levelisation over 25 years and with normative debt equity ratio (70:30). Discounting rate equivalent to weighted average cost of capital i.e.13.90% (=0.7x 13.00%+0.3*16.0%) has been considered.
2. Figures may not tally exactly on account of rounding of .
7/30/2019 Draft Wind Tariff FY 13-14
15/17
Determination of Higher Depreciation Benefit for Wind Power Projects
Depreciation amount 90% Anne xur e- II c ont d. ..
B oo k De pr ec ia ti on r at e 5 .2 8%
Tax Depreciation rate 15%
Additional depreciation rate
applicable during first year
20%
Income Tax 32.45% 30.90%
Capital Cost 550.00 Rs Lacs/MW
Year(s)--> Unit 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Book Depreciation % 2.64% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 5.28% 2.88%
Book Depreciati on Rs Lacs 1 4. 52 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9. 04 2 9 .0 4 2 9. 04 2 9. 04 2 9 .0 4 29 .0 4 2 9. 04 1 5 .8 4 0 .0 0 0 .0 0 0 .0 0 0 .0 0 0. 00 0 .0 0
Higher Depreciation Benefit
Opening balance % 100.00% 82.50% 70.13% 59.61% 50.67% 43.07% 36.61% 31.11% 26.45% 22.48% 19.11% 16.24% 13.81% 11.73% 9.97% 8.48% 7.21% 6.13% 5.21% 4.43% 3.76% 3.20% 2.72% 2.31% 1.
Allowed during the year % 17.50% 12.38% 10.52% 8.94% 7.60% 6.46% 5.49% 4.67% 3.97% 3.37% 2.87% 2.44% 2.07% 1.76% 1.50% 1.27% 1.08% 0.92% 0.78% 0.66% 0.56% 0.48% 0.41% 0.35% 0.
Closing % 82.50% 70.13% 59.61% 50.67% 43.07% 36.61% 31.11% 26.45% 22.48% 19.11% 16.24% 13.81% 11.73% 9.97% 8.48% 7.21% 6.13% 5.21% 4.43% 3.76% 3.20% 2.72% 2.31% 1.96% 1.
H ig he r d ep re ci ati on Rs L ac s 96.25 68.06 57.85 49.18 41.80 35.53 30.20 25.67 21.82 18.55 15.76 1 3.40 1 1.39 9.68 8.23 6.99 5.95 5.05 4.30 3.65 3.10 2.64 2.24 1.91
Net depreciation benefit Rs Lacs 81.73 39.02 28.81 20.14 12.76 6.49 1.16 (3.37) (7.22) (10.49) (13.28) (15.64) (17.65) (19.36) (20.81) (22.05) (23.09) (10.79) 4 .30 3.65 3.10 2.64 2.24 1.91 1
Tax Benefit Rs Lacs 2 6. 52 1 2. 06 8 .9 0 6 .2 2 3 .9 4 2 .0 1 0. 36 ( 1. 04 ) ( 2. 23 ) ( 3. 24 ) ( 4. 10 ) (4 .8 3) ( 5.4 5) ( 5. 98 ) (6 .4 3) ( 6.8 1) ( 7. 14 ) (3 .3 3) 1 .3 3 1 .1 3 0 .9 6 0 .8 2 0 .6 9 0 .5 9 0
Discounted Tax Benefit Rs Lacs 26.52 11.32 7.34 4.50 2.51 1.12 0.18 (0.45) (0.84) (1.07) (1.19) (1.23) (1.22) (1.18) (1.11) (1.03) (0.95) (0.39) 0.14 0.10 0.08 0.06 0.04 0.03 0
Levelised tax benefit Rs Lacs 5.18
Energy Generation MU 0.53 1.75 1.75 1.75 1.75 1.73 1.73 1.73 1.73 1.71 1.71 1.71 1.71 1.69 1.69 1.69 1.69 1.66 1.66 1.66 1.66 1.66 1.66 1.66 1
Discounted Generation MU 0.53 1.65 1.44 1.27 1.11 0.97 0.85 0.74 0.65 0.57 0.50 0.44 0.38 0.33 0.29 0.26 0.22 0.19 0.17 0.15 0.13 0.12 0.10 0.09 0
Levelised generation MU 1.58
Per Unit Benefit Rs/kWh 5 .0 5 0 .6 9 0 .5 1 0 .3 6 0 .2 3 0 .1 2 0. 02 ( 0. 06 ) ( 0. 13 ) ( 0. 19 ) ( 0. 24 ) ( 0. 28 ) ( 0.3 2) ( 0. 35 ) ( 0. 38 ) ( 0.4 0) (0 .4 2) (0 .2 0) 0 .0 8 0 .0 7 0 .0 6 0 .0 5 0 .0 4 0 .0 4 0
Discount Factor 1.00 0.88 0.77 0.68 0.59 0.52 0.46 0.40 0.35 0.31 0.27 0.24 0.21 0.18 0.16 0.14 0.12 0.11 0.10 0.08 0.07 0.07 0.06 0.05
Applicable Discount Factor 1.00 0.94 0.82 0.72 0.64 0.56 0.49 0.43 0.38 0.33 0.29 0.26 0.22 0.20 0.17 0.15 0.13 0.12 0.10 0.09 0.08 0.07 0.06 0.05
Levelised ITAX benefit Rs/kWh 0.3271
Note(s):
1.In the above calculations, depreciation for the first year has been considered as 17.50%(= 50% of (15%+20%)) as per CERC methodology
3. For working out Tax benefit, income tax rate for the first year has been considered as 32.45% and a tax rate of 30.90% for subsequent years.
TARIFF FOR WIND POWER PLANTS LOCATED IN DISTRICTS OTHER THAN JAISALMER,BARMER & JODHPUR
4. Figures may not tally exactly on account of rounding of .
2. Generation for the first year has been considered as 30% of the normative generation for the second half of the financial year.
7/30/2019 Draft Wind Tariff FY 13-14
16/17
Rajasthan Electricity Regulatory Commission
Vidyut Viniyamak Bhawan, Near State Motor Garage,Sahakar Marg, Jaipur-302001
Phone: 0141-2741299,2740067, Fax:0141-2741018, E-mail: [email protected]
website: www.rerc.rajasthan.gov.in
PUBLIC NOTICE
Notice is hereby issued under Section 64 (2) read with 61(h),62(1)(a) and 86 (1) (e) of
the Electricity Act, 2003 for determination of levelised generic tariff for sale of
electricity by Wind power plants to distribution companies of the State based on the
parameters specified in RERC(Terms & Conditions for determination of Tariff)
Regulations, 2009 read with Fourth Amendment in RERC Tariff Regulations. The
levelised generic Tariff proposed for FY 2013-14 is as under:
S.
No.Particulars
Tariff
(`/kWh) ifhigher
depreciation
benefit is not
availed
Tariff
(`/kWh) ifhigher
depreciation
benefit is
availed
1 2 3 4
1 Wind Power Plants located in Jaisalmer,
Jodhpur & Barmer districts
5.48 5.17
2 Wind Power Plants located in districts other
than Jaisalmer, Jodhpur & Barmer districts.
5.75 5.43
The above tariff is levelised for 25 years.
Any persons desirous of offering suggestions/comments on the aforesaid tariff
proposal may do so in five copies, so as to reach this office by 25 th March, 2013with
copies of supporting details. The suggestions/comments can also be sent to the
Commission through e-mail at [email protected] . The copy of the draft order is
also available with the Receiving Officer of the Commission and can be obtained
on payment of Rs 100/-. The draft order is also available on Commissions website
www.rerc.rajasthan.gov.in. The hearing in the matter shall be held on 9th April, 2013
at 11.30 AM in RERCs office, Jaipur. Persons giving suggestions/comments by the
said date and desiring personal hearing could do so during the said hearing.
G.K.Sharma
(Secretary )
(Not to be published)
G.K.Sharma
(Secretary)
7/30/2019 Draft Wind Tariff FY 13-14
17/17
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