CERC (Terms & Conditions for Tariff

Determination from Renewable

Energy Sources) Regulation, 2009

11.08.2011
AK
CERC (T&C for tariff determination from renewable
sources) Reg. 2009
Applicable
WPD 200 W/m2 & hub height 50 m
Small Hydro
Biomass
Co-gen
Solar PV & Solar Thermal
Provision for Project specific tariff
Tariff Period
13 years
Small Hydro 35 years
Solar PV & Solar Thermal 25 years

CERC() Regulation 2009
Useful Life
Wind energy power project 25 years
Biomass power project, non-fossil fuel co-gen 20 yr
Small Hydro 35 years
Solar PV/ Solar Thermal 25 years
Capital Cost Norms
Wind energy (FY 2009-10): Capital 5.15 Cr/ MW
Small Hydro (FY 2009-10)
Himachal, Uttarakhand, NE States
Plant below 5 MW = 7.00 Cr/MW
Plant 5 to 25 MW = 6.30 Cr/ MW
Other states
Plant below 5 MW = 5.50 Cr/MW
Plant 5 to 25 MW = 5.00 Cr/ MW
Biomass based generation: Capital Cost for FY 2009-10 - 4.50 Cr
/MW
Non-fossil fuel based Co-generation Projects: Capital Cost for
FY 2009-10 - 4.45 Cr /MW
Solar PV Plant: Capital Cost for FY 2009-10 17.00 Cr /MW
Solar thermal Plant: Capital Cost for FY 2009-10 13.00 Cr
/MW
Capital Cost for subsequent years is indexed
Tariff Determination
Annual Revenue Requirement (ARR)
Fixed Cost
Return on Equity 19% pre-tax for 10 years, 24% pre-tax
for remaining period on equity 30% of the asset value of
plant.
Interest on Loan
70% of the asset value is loan
Repayment period 10 years
Weighted average interest rate
Interest rate Long term prime lending rate of SBI in previous year
+ 150 basis point
Depreciation 7 % of the asset value for repayment period.
remaining depreciation (i.e. 20%) spread over remaining
useful life of plant. Prorata depreciation for part of the year.
Interest on Working Capital
Operations & Maintenance expenses (Employee Cost,
Repair & Maintenance Expenses, Admin & Gen Expenses)
Corporate tax at actual
Tariff Determination ARR (Cont.)
Interest on Working Capital
Wind, Small Hydro, Solar PV, Solar Thermal
O&M Expenses of 1 month
Receivable for 2 months
Maintenance spares of 15% of O&M
Biomass and Non-fossil Fuel (Cogeneration)
Fuel Cost of 4 months for normative PLF
O&M Expenses of 1 month
Receivable for 2 months of Fixed & Energy Charges for target PLF
Maintenance spares of 15% of O&M
Interest rate Long term prime lending rate of SBI in
previous year + 100 basis point
Tariff Determination ARR (Cont.)
O&M Expenses
Wind based energy: For year FY 2009-10 6.50 lakh/ MW & 5.72%
escalation/ year thereafter
Small Hydro Generation for year FY 2009-10
Plant below 5 MW for Hill States Rs. 21 lakh/ MW
Plant 5 to 25 MW for Hill States Rs. 15 lakh/ MW
Plant below 5 MW for other States Rs. 17 lakh/ MW
Plant 5 to 25 MW for other States Rs. 12 lakh/ MW
Escalation factor for control period 5.72%
Biomass based generation: For FY 2009-10 20.25 lakh/ MW & 5.72%
escalation/year thereafter
Non-fossil fuel based co-generation Plant
For FY 2009-10 13.35 lakh/ MW & 5.72% escalation/ year thereafter
Solar PV generation for FY 2009-10 Rs. 9 Lakh/ MW & 5.72%
escalation/ year thereafter
Solar thermal generation for FY 2009-10 Rs. 13 Lakh/ MW & 5.72%
escalation/ year thereafter
Auxiliary energy consumption 10%
Tariff Determination ARR (Cont.)
Fuel Cost
Biomass based generation
Station heat rate 3800 kCal/ kWh
Plant to be designed for multifuels (crop residue, agro-industrial
residue, forest residue)
Usage of fossil fuel shall be limited to 15%
Statewise calorific value of biomass for tariff (kCal/kg)
Andhra Pradesh 3275
Haryana 3458
Maharashtra 3611
Madhya Pradesh 3612
Punjab 3368
Rajasthan 3689
Tamilnadu 3300
Uttar Pradesh 3371
Other States 3467
Tariff Determination ARR (Cont.)
Fuel Cost Biomass based generation (Cont..)
State Biomass Price (Rs/MT)
Andhra Pradesh 1301
Haryana 2168
Maharashtra 1801
Madhya Pradesh 1299
Punjab 2092
Rajasthan 1822
Tamilnadu 1823
Uttar Pradesh 1518
Other States 1797
Non-fossil fuel based co-generation
SHR 3600 kCal/ kWh for power generation only.
For cane-bagasse calorific value 2250 kCal/ kg
For other fuels in co-gen plant biomass parameters shall apply
Tariff Determination ARR (Cont.)
Fuel Cost non-fossil fuel based co-generation
(Cont..)
Statewise Bagassse Prices (Rs/MT) FY 2009-10
Andhra Pradesh 899
Haryana 1411
Maharashtra 1123
Madhya Pradesh 809
Punjab 1398
Tamilnadu 1243
Uttar Pradesh 1013
Other States 1163
Thereafter 5% escalation shall be considered
Fuel Price Indexation mechanism given separately

Other Principles for approval of charges
Discounting factor for levelalized tariff
Levellisation for useful, while tariff shall be determined for
control period.
Must run (not subjected to merit order)
Wind,
Small hydro
Municipal solid waste
Solar
Biomass based generation below 10 MW
Despatches against merit order
Biomass plant larger than 10 MW
Non-fossil fuel Co-generation
Sharing of CDM benefits: 1
st
year 100%, 2
nd
year 90%, 3
rd
year
80%, 4
th
year 70%, 5
th
year 60%, 6
th
year onwards 50% of the
proceed shall be retained by project developers. Remaining shall
be shared by beneficiary.

Capacity Utilization Factor
Wind Generation
For place with Annual Mean Wind Power Density 200 to 250 w/m2 20%
For place with Annual Mean Wind Power Density 250 to 300 w/m2 23%
For place with Annual Mean Wind Power Density 300 to 400 w/m2 27%
For place with Annual Mean Wind Power Density more than 400 w/m2 30%
Annual Mean Wind Power Density to be measured at 50 m hub height
Small Hydro Power
45% in Hill States & 30% in other states (net of free power to the host state)
Auxiliary consumption 1%
Biomass based generation
PLF in stabilization period 60%,
during remaining period of 1
st
year 70%,
2
nd
year onwards 80%
Auxiliary consumption 10%
Non-fossil fuel based Co-gen Plant
PLF based on number of days plant is available considering 92% loading factor
Number of operating days in AP & UP 180 days PLF 45%
Number of operating days in Tamilnadu & Maharashtra 240 days PLF 60%
Number of operating days in Other states 210 days PLF 53%
Auxiliary consumption 8.5%
Solar PV Plant Capacity utilization factor 19%
Solar Thermal Plant Capacity utilization factor 23%
End