CERC notifies tariff regulations for green power

17 Sep 2009

1

The Central Electricity Regulatory Commission (CERC) has notified the tariff regulations for electricity generated from renewable energy sources.

CERC has fixed the normative return on equity at an average 19 per cent per annum pre-tax for the first 10 years and 24 per cent per annum from the 11th year onwards.

The value base for the equity will be 30 per cent of the capital cost or actual equity (in case of project specific tariff determination), CERC said in release.

These regulations have been finalized keeping in view the statutory mandate to Electricity Regulatory Commissions for promoting co-generation and generation of electricity from renewable sources of energy. The tariff policy had also mandated CERC to lay down guidelines for pricing non-firm power, especially from non-conventional sources to be followed in cases where such procurement is not through competitive bidding.

Addressing the press conference in New Delhi today, CERC chairman Pramod Deo said that these regulations assume special importance in view of the National Action Plan on Climate Change which stipulated that minimum renewable purchase standards may be set at 5 per cent of the total power purchases in year 2010 and thereafter should increase by 1 per cent each year for ten years. He said the new tariff regulations are expected to promote new investments so that renewable electricity supply could expand to meet the goals stipulated in the National Action Plan.

Specifying capital cost norms and fixing tariff upfront for the whole tariff period are the two main features of the new regulations.

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