APERC determines tariff for biomass, bagasse power projects

Andhra Pradesh Electricity Regulatory Commission (APERC) through an order dated 16th May 2014, has determined the variable cost for existing Biomass, Bagasse, and Industrial waste based power projects in AP for the period 1st April 2014 to 31st March 2019.

The commission before finalizing this order had done its due diligence by floating a consultation paper and holding a public hearing in which every stakeholder’s view was taken into consideration. This process was carried out on the lines of directives of ApTel in its 20th Dec 2012 order which says –

“However, we feel that there is a need for carrying out a scientific study for determining the normative parameters specific to the state for future. The study should also take into consideration the technological improvements that have since taken place in the generation by non-conventional energy sources. We direct the State Commission to arrange to undertake the study on priority and frame its Tariff Regulations for purchase of power by distribution licensees from NCE sources after considering the Study Report, Central Commission’s Regulations and any other relevant information.”

The variable cost determined for Biomass based projects are as in table below:

The costs projected for subsequent years are indicative; meaning the commission will determine the actual price escalation before the start of each financial year starting FY16.

The variable cost determined for Industrial waste based power projects:

The variable cost determined for bagasse based power projects are:

 The order can be read in detail by clicking here.

MERC drafts RE Tariff Order for FY 2014-15

Maharashtra Electricity Regulator – MERC on 6th May has made public a draft order for tariff of renewable energy produced within the state in FY15. Comments and suggestions are invited by 5th June 2014 as per this public notice.

A glimpse of tariff for new RE projects can be had in the following table –


The draft order is available here.

Rajasthan sets revised tariff for Solar and Biomass power projects

Rajasthan electricity regulatory commission (RERC) through an order dated 4th September 2013, has set a new preferential tariff rate for all solar projects (PV or thermal) to be set up in the state. As per this order, the tariff has been set at Rs. 8.33 per unit for solar PV projects and Rs. 11.37  per unit for solar thermal projects (for projects not availing AD benefit). The new tariff has been decreased by 13.5 % for solar PV and by around 5% for solar thermal projects respectively.

This tariff will be applicable for solar PV projects signing PPA on or before 31.04.2014 and getting commissioned before 31.03.2015. In case of solar thermal projects the commissioning date must be on or before 31.03.2016.

The solar PV tariff is 42 paise per unit less than that bench-marked by CERC and for solar thermal projects it is 53 paise lesser than corresponding CERC benchmark.

S.No Particulars Tariff (when AD not availed) as per T.O dated – 30.05.2012 in Rs. Per unit Tariff (when AD is not availed) as per T.O dated – 04.09.2013 in Rs. Per unit  % change in tariff
1 Solar PV  9.63 8.33 -13.50%
2 Solar Thermal 11.95 11.37 -4.85%

 The order on solar tariff can be accessed by clicking here.

With regards to Biomass based projects, the order was out on 8th October 2013. As per this order, for projects commissioned during FY14, the tariff applicable is Rs. 5.44 per unit (for projects not availing AD) and Rs. 5.23 (for projects availing AD).

MP introduces new tariff for wind and bagasse based cogen plants

Hon’ble MPERC recently unveiled its wind tariff order 2013 for procurement of power from wind energy generators. For new wind projects commissioned after 26.03.2013, the tariff has been set as Rs. 5.92 per unit. The commission has considered Rs. 596 lakhs per MW (including cost of power evacuation) and capacity utilization factor of 20% for tariff determination. Other important parameters considered are as under:

MPERC’s previous wind tariff order available dates back in the year 2010 when a tariff of Rs. 4.35 per unit was finalised. This implies that there has been increase of 36.09 % in this year’s tariff. The distribution company in whose area the energy is consumed has been ordered to deduct 2 % of the energy injected towards wheeling charges for third party sale/captive consumption.

Given the fact that Govt. of India has considered reintroduction of Generation Based Incentive for WEGs in its Budget for FY14, the wind power generation business in the state seems lucrative. The APPC + REC module, on the contrary, has limited encouragement for WEGs wanting to participate in the REC Markets considering the fact that RECs have been trading at floor prices (see March 2013 Trading Report) and the APPC in the state is around Rs. 2.47 per unit. This sums up the net realization for WEGs to be around 3.97 Rs per unit which is indeed 33% less than what preferential tariff has to offer.

MPERC also came up with new tariff for bagasse based cogeneration plants in Madhya Pradesh. The tariff for new plants to be commissioned on or after 01.04.2013 has been determined as Rs. 6.28 per unit for a project life of 20 years.

The important parameters considered for tariff determination are provided in the table below:

India’s Biomass Scenario

In an article in the Business Standard on the current scenario of the biomass plants in India was reported. Burgeoning raw material costs and a mismatch between generation cost and pricing have led biomass power plants to function well below their capacity and, in some cases, end operations.

Against an estimated potential of 18,000 MW, the installed capacity of biomass plants in India is 2,664 MW. These plants are in Maharashtra (403 MW), Andhra Pradesh (363 MW), Karnataka (365 MW), Madhya Pradesh (7 MW), Tamil Nadu (488 MW), Punjab (74 MW), Haryana (35 MW), Rajasthan (73 MW), Uttar Pradesh (592 MW), West Bengal (16 MW) and Uttarakhand (10 MW), among others.

Industry sources said it was difficult to run these plants, as raw material like forest residue, agricultural waste and non-cattle feed was not available even at Rs 3,000 per tonne. Read more…

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