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Date: 09-Aug-2024 Category: Extra Ordinary State: Union Government Country: India

In pursuance of Clause 5 6 vi of the Ministry of Power MOP Notification on Guidelines for Determination of Tariff by Bidding Process for Procurement

Issued by Central Electricity Regulatory Commission · Not Applicable

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Executive Summary & Key Takeaways

Gazette Notification Description

  • This gazette notification from the Central Electricity Regulatory Commission (CERC), dated August 9, 2024, announces monthly escalation rates for payments related to power procurement by distribution licensees. These rates are applicable for July 2024 and are based on several previous guidelines and communications from the Ministry of Power (MOP).

Key Changes/Updates

  • The CERC has notified the following monthly escalation rates for July 2024 payments for power procurement by distribution licensees:
  • 1. Escalation rate for imported coal: -1.26%
  • 2. Escalation rate for transportation of imported coal: -1.99%
  • 3. Escalation rate for inland handling of imported coal: 0.75%

Impact Analysis

Impact on Distribution Licensees

  • Distribution licensees will experience adjustments to their payments for power procurement based on the notified escalation rates. The negative rates for imported coal and its transportation will result in reduced payments, while the positive rate for inland handling will increase payments. The overall financial impact will depend on the proportion of power procured through each of these channels.

Impact on Power Producers

  • Power producers selling electricity to distribution licensees will see their revenue streams affected by these escalation rates. The impact will vary depending on their sourcing of coal (imported vs. domestic) and their contracts with distribution licensees.

Impact on Consumers

  • The ultimate impact on consumers is indirect and will depend on how distribution licensees manage the changes in their procurement costs. While reduced costs for imported coal and transportation could potentially lead to lower tariffs, this effect might be offset by increased costs for inland handling. The net effect on consumer electricity bills is uncertain without further analysis.

Suggested Action Items

  • Further analysis is needed to determine the overall impact on consumer tariffs.

Key Entities Referenced

Central Electricity Regulatory Commission (CERC): The issuing authority of the gazette notification. Responsible for regulating the electricity sector in India. Ministry of Power (MOP): The ministry responsible for formulating policies related to the power sector. Its previous notifications and communications form the basis for the CERC's decision. Distribution Licensees: Entities that procure power and distribute it to consumers. Directly impacted by the notified escalation rates. Power Producers: Entities that generate and sell electricity. Their revenue is affected by the changes in procurement costs. Guidelines for Determination of Tariff by Bidding Process for Procurement of Power by Distribution Licensees (dated 19.01.2005): A key document referenced in the notification, outlining the framework for power procurement. MOP communication dated 13.04.2022 and MOP Resolution dated 11.07.2022: Further communications from the MOP that influenced the escalation rate determination. SHAKTI (Scheme for Harnessing and Allocating Koyala (Coal) Transparently in India) Policy: Policy related to coal allocation, which indirectly impacts power generation costs.
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रजिस्ट्री स.ं डी.एल.- 33004/99 REGD. No. D. L.-33004/99 सी.जी.-डी.एल.-अ.-10082024-256268 xxxGIDHxxx CG-DL-E-10082024-256268 xxxGIDExxx असाधारण EXTRAORDINARY भाग III—खण् ड 4 PART III—Section 4 प्राजधकार स ेप्रकाजित PUBLISHED BY AUTHORITY स.ं 609] नई दिल्ली, िुक्रवार, अगस्ट्त 9, 2024/श्रावण 18, 1946 No. 609] NEW DELHI, FRIDAY, AUGUST 9, 2024/SHRAVANA 18, 1946 ubZ fnYyh] 25 tqykbZ] 2024 .—Þforj.k vuqKfIr/kkfj;ks a }kjk ÅtkZ dh mikfIRk ds fy, cksyh çfØ;k }kjk VSfjQ dk vo/kkj.k djus grs q ekxZn'kdZ fl)kra ß ls lacaf/kr fo|qr e=a ky; dh le;≤ ij ;Fkkla'kkfs/kr rkjh[k 19-01-2005 dh vf/klwpuk ds [kaM 5-6 ¼vi½ ds vuqlj.k eas] dsUnzh; fo|qr fofu;ked vk;kxs dk s fo|qr e=a ky; ds i= fnukad 13-04-2022 vkSj **'kfDr ¼Hkkjr eas dk;s yk] ikjn'khZ :Ik es a vkcafVr djus okys vkSj gkuZsflax ds fy, ;kts uk½ uhfr** fnukda 06-03-2019 ds ch¼I½] ch¼III½ vkSj ch¼IV½ ds v/khu dk;s ys ds vkcaVu lfgr ekWMy ckys h nLrkots kas ds v/khu ;FkkçnÙk fMtkbu] fuekZ.k] foÙk] LokfeRo vkSj çpkyu ¼Mhch,Qvkvs k½s vk/kkj vkSj lzksr bZa/ku ij LFkkfir FkeZy ikoj LVs'kuksa ls fo|qr dh nh?kdZ kfyd mikfIr ds fy, ekxZfunsZ'k** ds la'kk/s ku ij fnukda 11-07-2022 ds çLrko ds vuqlj.k eas] dsfofovk Hkqxrku ds iz;kts u ds fy, fuEufyf[kr o`f) njkas dk s vf/klwfpr djrk gSA 5064 GI/2024 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC.4] 1- vk;kfrr dks;ys ds fy, o`f) nj -1.26% 2- vk;kfrr dks;ys ds ifjogu ds fy, o`f) nj -1.99% 3- vk;kfrr dks;ys dh varnsZ'kh; mBkbZ&/kjkbZ ds fy, o`f) nj 0.75% gjizhr flag çqFkh] lfpo [जवज्ञापन-III/4/असा./378/2024-25] CENTRAL ELECTRICITY REGULATORY COMMISSION NOTIFICATION New Delhi, the 25th July, 2024 No. Eco-M07/2024-CERC.— In pursuance of Clause 5.6 (vi) of the Ministry of Power (MOP) Notification on “Guidelines for Determination of Tariff by Bidding Process for Procurement of Power by Distribution Licensees” dated 19.01.2005 as amended from time to time, MOP communication to the Central Electricity Regulatory Commission (CERC) dated 13.04.2022, and MOP Resolution dated 11.07.2022 on an amendment to the “Guidelines for long term Procurement of Electricity from Thermal Power Stations set up on Design, Build, Finance, Own and Operate (DBFOO) basis and sourcing fuel as provided under Model Bidding Documents including allocation of coal under B (I), B(III) and B(IV) of SHAKTI (Scheme for Harnessing and Allocating Koyala (Coal) Transparently in India) Policy” dated 6.03.2019, the CERC notifies the following escalation rates for the purpose of payment. Monthly Escalation Rates applicable for July 2024 for the purpose of payment for Procurement of Power by Distribution Licensees as per the Power Purchase Agreement entered into under the Guidelines mentioned above: Sr. Description Monthly Escalation Rates No. for Payment 1 Escalation rate for imported coal -1.26% 2 Escalation rate for transportation of imported coal -1.99% 3 Escalation rate for inland handling of imported coal 0.75% HARPREET SINGH PRUTHI, Secy. [ADVT.-III/4/Exty./378/2024-25] Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064 and Published by the Controller of Publications, Delhi-110054.

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