WIND TARIFF HITS A NEW LOW

In an auction held yesterday in Tamil Nadu by TANGEDCO, the latest tariff which has been determined is Rs 3.42 per unit. This is lower than the tariff determined in the auction held in February and below the tariff determined under FiT mechanism. The auction was won by ReGen Powertech, Leap Green Energy and Powertech India for 200 MW, 250 MW and 50 MW capacities respectively.

Keeping in view the recent trend of cancellation of PPAs which were signed at a higher rate, the power minister Sree Piyush Goyal has requested the state utilities to honor them as this can pose a threat to the development of the projects which have already been signed. Though this falls in line with the government’s initiative to have 175 GW RE capacity by 2022, it may also prove to be counterproductive.

The article can be accessed here.

REC TRADE RESULT AUGUST 2017

Supreme Court allowed conditional trading of Non-solar RECs in an order dated July 14, 2017 . Demand was expected to be low for two reasons – 1) obligated entities are required to pay at old RECs rate (Rs 1500/ REC); and 2) compliance is required to be done by March to obligated entities have enough time to comply even after the final order of Aptel is received.

This is the second month when trading has taken place after CERC allowed conditional trading of Non-Solar RECs but the demand was not as robust as last time .

Non-solar demand was marginally higher than in August 2016 , and significantly lower than last month. In total 2.89 lakh RECs were traded (11.83 % higher than August 2016), and clearing ratios on IEX and PXIL were 1.05% and 4.96% respectively.


Solar RECs were not traded as the stay imposed by the Supreme Court remains in force in the case of Solar RECs.

TSERC DETERMINES RETAIL TARIFF FOR FY 2017-18

The Telangana State Electricity Regulatory Commission (TSERC) has determined its retail tariff in an order dated 26/08/2017 for FY 2017-18. The tariff has been determined as follows:

 

The change in tariff from in the past 3 years can be understood with the graph below:

 

The wheeling loss for NPDCL has been determined as 4.40% and that for SPDCL as 4.20% at a voltage level of 11 kV.

A separate order was released for the determination of cross subsidy surcharge. The change in CSS  for industrial category is as follows:

 

The order can be accessed here. The order determining CSS can be accessed here.

UDAY SCHEME BRINGS BENEFITS TO DISCOMS

The Ujwal DISCOM Assurance Yojna (UDAY) scheme was launched in November 2015 by the Ministry of Power (MoP) and the Government of India (GoI). Since then, there has been significant improvement in the debts of the DISCOMs.

 

The participating states have taken over Rs 2.09 lakh crores of debt of their DISCOMs. The remaining debt is mostly in the form of CAPEX debt or scheme based debt which usually either pays itself off or which converts into grants. Therefore, the process of the states taking over the debts of DISCOMs and issuing them as SDL bonds has now been completed. Now the remainder of the action which includes bond issuance by the DISCOMs has to be completed.

 

Due to these actions, till March 2017, the participating DISCOMs had achieved net savings of Rs 15,000 Cr. The gap between Average Cost of Supply (ACS) and Average Revenue Realized (ARR) had also come down by 14 paisa per unit along with a reduction of 1% in the AT&C losses.

Details about the UDAY scheme and its implementation on our blog can be accessed here.

DERC NOTIFIES RPO REGULATION

The DERC has released draft RPO regulations in an order dated 28/07/2017. Following are the salient features of the regulation:

 

  1. RPO Compliance:

  • Aggregate from the gross purchases from generating stations by Obligated entities shall be considered as the quantum of RE purchase for RPO compliance.

  • All the power produced from Waste-to-energy plants shall be procured by the distribution licensee. This will also contribute towards RPO compliance.

  • Quarterly reports shall be submitted by the obligated entities which will include parameters such as capacity addition, generation and purchase of electricity from RE sources. The same shall also be posted on their website.

  1. Role of SNA:

 

  • Protocol development for regular information collection from RE generating companies, obligated entities, SLDC, chief electrical inspector, ets.

  • RE procurement and RPO compliance reports on a monthly basis by obligated entities which shall also go on their websites. This shall be done by the 10th of the next month.

  • It shall also receive information on or before 30th April from captive users who are consuming electricity generated from captive generating plants about electricity consumption and purchase from RE sources.

  • The same shall be applicable for open access consumers.

This regulation isn’t very different from the previous RPO regulation which was released in October 2012.

The order can be accessed here. The public notice can be accessed here.

MOP DETERMINES GUIDELINES FOR FOR COMPETITIVE BIDDING FOR POWER PROCUREMENT FROM SOLAR PV PROJECTS

The Ministry of Power (MoP) has released the guidelines for procurement of power from grid connected solar PV power projects. The guidelines are applicable to solar PV projects of size 5 MW and above. The purpose of these guidelines is to provide a direction for proper electricity procurement by distribution licensees and to protect the interest of the consumers. Also to make this process transparent and uniform.

 

Following are the salient features of the guidelines:

 

  • The appropriate Commission shall be CERC only in case if the distribution licensee is located in more than one state

  • SERCs will be the appropriate commission in case if there is a single distribution licensee.

  • The conditions to be met by the procurer are as follows:

  • The bid document should be prepared in accordance with the guidelines of MoP and the Standard Bidding Documents.

  • Clearances need to be procured from the end procurer, the agency developing the solar park.

  • Procurer has to specify where the project has been set up.

  • The bid structure shall be as follows:

  • The bids will be designed in terms of packages where the minimum will be 50 MW and the bids may be in energy quantity or power capacity terms.

  • The procurer may opt for either ‘tariff as bidding parameter’ or ‘VGF as the bidding parameter’.

  • The PPA period should not be less than 25 years and it can be in terms of energy or power. Repowering will be allowed from time to time for the duration of the PPA.

  • In case of default by the power generator, it shall be liable to pay the solar power generator as written in the PPA. Also, in such a case, the lender shall be allowed to exercise their right to substitution as per the substitution agreement provided in the PPA.

  • In case if the procurer is at default, it shall give its part of the PPA to a third party in the given time. In case if that is not done, the solar generators have a choice to terminate the PPA.

  • Once the procurer calls for bids, a single stage bidding process shall be followed. The procurer can also chose if an e-reverse auction shall be held. It is the responsibility of the procurer to give the details of the bidding process in case of a Solar park specific project.

  • For bid submission and evaluation, the bidders may form a consortium and chose a leader who shall be the focal point of contact. Also, for evaluation of bids, the procurer may form a committee. The technical and price bids shall be submitted separately along with a bid guarantee. Minimum number of bidders should be two and a proper methodology shall be followed for bid evaluation.

  • A 30 day period shall be given for bid submission from the issuance of RfS document. A table containing the time table for bid process is given in the guidelines attached below.

  • Bank guarantees such as earnest money deposit and performance bank guarantee need to be submitted.

The guidelines can be accessed here.

APERC DETERMINES WIND AND SOLAR FORECASTING AND SCHEDULING REGULATION

Andhra Pradesh Electricity Regulatory Commission (APERC) has released its forecasting, scheduling and Deviation settlement of solar and wind generation on 21/08/2017.

Executive Summary:

★ Applicability:

○ Regulation is effective from Aug 21st, 2017.

○ SLDC to issue detailed guidelines for QCA registration, scheduling procedures, communication protocols and formats etc., on or before Dec 1st, 2017.

○ Forecasting, Scheduling and Deviations Settlement shall commence from Jan 1st, 2018.

Further, generators commissioning on or after Jan 1st, 2018 shall not be allowed to be commissioned unless they start providing schedules as per this regulation.

○ Levy and collection of DSM Charges shall commence from Jul 1st, 2018

★ Regulation Applicable on: All the GRID Connected Wind and Solar Power Generators in AP.

★ Deviation Accounting:

★ Point of Forecasting: Pooling Station or STU/DISCOM Feeder where injection is made.

★ Virtual Pool: To enable benefits of larger geographical area and diversity, aggregation of forecast is permitted under “Virtual Pool” where Generators have an option to account for their deviations at an aggregated level through a Qualified Coordinating Agency (QCA).

○ A similar provision is also permitted in Karnataka by Hon. KERC in its final regulation which is already being implemented w.e.f 1st June 2017.

 

★ Role of a QCA:

○ Provide forecast, schedules and periodic revisions;

○ Coordination with DISCOM/STU/SLDC for metering, data collection, communication/issuance of dispatch/curtailment;

○ Commercial settlement of DSM charges and de-pooling of charges among generators;

○ All other ancillary and incidental matters.

★ Important differences between wind and solar power scheduling:

○ 16 revisions (excluding collective transactions) are permitted starting from 00:00 Hrs of the     day for Wind Generators

○ 9 revisions (excluding collective transactions) are permitted starting from 05:30 Hrs upto 19:00 Hrs of the day for Solar Generators

○ All the revisions are effective from the 4th time-block

○ Aggregation “seems” to be allowed between wind and solar generation as the concept of virtual pool aims to capture not only the larger geographical area but also the diversity (among different asset class).

 

★ Important differences between intrastate and interstate transactions:

○ Wind and Solar generators having common interface meter at a pooling station but carrying out both – interstate and intrastate transactions at the same pooling station, the scheduling for the same shall to be carried out separately.

○ Approved open-access capacity (in MW) in such cases alone shall be considered as AvC for the purpose of DSM charges calculations.

■ Observation: Since the regulation permits common interface meter for such transactions and AvC determination is also clarified, the DSM charges may be computed in pro-rata basis for such pooling station as the common interface meter would only provide Pooling Station level actual generation.

 

○ Further, aggregation is permitted only for similar type of transactions i.e., interstate transactions are not allowed to be aggregated with intrastate transactions for the purpose of DSM charges determination.

○ QCA shall separately settle DSM charges for intrastate and interstate transactions.

★ Determination of DSM Charges for INTRASTATE transactions:

Note: DX is the absolute error in kWh for a given error band starting from X% as outlined in column 2.

 ★ Determination of DSM Charges for INTERSTATE transactions: 

Note: DX is the absolute error in kWh for a given error band starting from X% as outlined in column 2.

TAMIL NADU DETERMINES DISTRIBUTION AND TRANSMISSION TARIFF FOR FY 2017-18

The Tamil Nadu Electricity Regulatory Commission (TNERC) has determined the distribution and transmission tariff for FY 2017-18. The last time they had determined tariff was in 2014 which means that the tariff has changed after 3 years. The energy charges for different categories is as follows:

 

 

The tariff for industrial and domestic categories hasn’t changed at all. Same is the case with domestic tariff.

 

Wheeling Charges: 21.06 Paisa/Unit

Wheeling loss: 2.45%

Cross subsidy surcharge: 1.67 Rs/kWh

The transmission tariff was also determined by the TNERC. It is as follows:

 

Transmission charges: 3037.30 Rs/MW/day

Transmission loss: 3.81%

 

The distribution and generation tariff can be accessed here. The transmission tariff can be accessed here.

CERC REJECTS IEX’S PROPOSAL FOR GDAM

The Indian Energy Exchange (IEX), so as to provide the obligated entities more number of ways to fulfill their RPO compliance, had proposed to the CERC to allow the existing renewable energy generators to trade RE on IEX.

 

For the same, it had proposed that the following contracts including Green Day Ahead Market (G-DAM) which includes Solar and non-solar day ahead market be introduced. If the bid made in the G-DAM is not cleared or cleared partially, they can bid in DAM. Also, in lieu of the bid cleared in DAM, the seller will get equal number of RECs.

This order was rejected by the CERC and the following reasons were given for the same:

  • As per CERC, the status regarding the availability of surplus power is not clear. Also, based on the experiences in the past, it can be established that such trade will not lead to addition of new RE capacity.

  • The IEX has supposed that there are no discrepancies in the forecasting and scheduling for RE generators which is not the case. Therefore, their suggestions of remove the need for revision flexibility during the day is not valid.

  • Based on the suggestions of IEX which mentioned that in case if the bid made in the G-DAM is not cleared or cleared partially, they can bid in DAM, it can be assumed that the situation will lead to registration of RE sellers for FIT route as well as REC mechanism. This will demand that a system be established where there is proper accreditation, registration, accounting of RE generation and settlement mechanism.

  • The G-DAM market may dissuade the buyers from entering into long term contracts which provide comfort to RE investors.

  • The guidelines related to the timelines for scheduling of power traded will have to be amended as per IEX which the commission felt will be an unnecessary step right now.

  • IEXs recommendations assume that the the green power traded in G-DAM will follow the same scheduling procedure as that followed by conventional power. Therefore, the commission feels that there is no need to introduce a separate segment for trading.

The order can be accessed here.

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