CERC determines Benchmark Capital Cost Norm for Solar PV and Solar Thermal power projects applicable during FY 2016-17

The Central Electricity Regulatory Commission vide its final order on 23rd March, 2016 determined the Benchmark Capital Cost Norm for Solar PV and for Concentrated Solar Power (CSP) projects for 2016-17. In case of determining the capital cost for Solar Photo voltaic, many parameters were considered like the Land cost and cost of PV modules etc.

The graph below depicts the change in the total capital cost from FY 2012-13 to FY 2016-17 and the % change year on year. The capital cost of Solar PV has decreased approximately by 68%  from  FY 2012-13.

 

 

In case of Solar Thermal, Commission had proposed to retain the benchmark capital cost of Solar Thermal power projects at INR 12.0 Crore / MW for FY 2016-17 (which remained the same in FY14-15 and FY 15-16). After reviewing all the comments and suggestions the Commission came up with the following order:

“Given the nascent stage of technology for Solar Thermal, the Commission has proposed to retain the benchmark cost without any decrease. At this point, it is not feasible to further increase these prices. The Commission decides to retain the benchmark capital cost for Solar Thermal power projects at INR 12.0 Crores / MW for FY 2016-17.”

The final order for FY 14-15 can be accessed here.

The final order for FY 15-16 can be accessed here.

The final order for FY 16-17 can be accessed here.

CERC finalizes RE tariff for FY15

Central Electricity Regulatory Commission (CERC) in its order on 15th May has finalised the Renewable Energy tariff for FY 14-15.

The details of the tariff calculated for FY 14-15 can be found in table below.

In the table above, it is clearly evident that CERC has finalized a higher price in case of solar projects as compared to that proposed in its draft. The price now finalized of Rs. 6.95 per unit is approx. 9.7% higher (than Rs. 6.33 per unit proposed in the draft).

A higher tariff determination for solar follows a similar consideration of higher benchmark capital cost. It was proposed that the capital cost for SPV projects to be Rs. 612 Lakh per MW. However, in the final order the capital cost now stands at Rs. 691 Lakh per MW.

It can be said that the apex regulator has finalised the tariff in response to views/suggestions of all stakeholders.

A higher solar tariff means grid parity still remains a distant dream. However, given the pace with which the retails tariffs across various states have been increasing and the fact that solar prices are coming down aggressively, it can be inferred that a “distant dream” is not too far away.

 

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