MERC extends period of applicability of RE Tariff

The Commission had issued a Suo Moto Order on 7 July, 2014 in determining the Generic Tariff for RE technologies for the fifth year of the Control Period, i.e. FY 2014-15. The control period of RE Tariff regulations 2010, elapsed on 31st March 2015 and so the commission extended its period of applicability till 31 July, 2015. Since the regulatory process for revising RE Tariff Regulations for the next Control Period has not been completed yet, the Commission has further extended the applicability of its order till 31 October, 2015 or issue of new RE Tariff order whichever is earlier.

The relevant order 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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