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Date: 21-Apr-2023 Category: Extra Ordinary State: Union Government Country: India

In pursuance of paragraph 5 1 and paragraph 6 4 of the Ministry of Power s Resolution dated 22 07 2020on Guidelines for Tariff Based Competitive Bidding Process for Procureent of Round The Clock Power from Grid Connected Renewable Energy Power Projects,

Issued by Central Electricity Regulatory Commission · Not Applicable

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Executive Summary & Key Takeaways

What it means

  • The Central Electricity Regulatory Commission (CERC) has issued a notification regarding the annual escalation rates and discount rates to be used for bid evaluation in tariff-based competitive bidding processes for Round-The-Clock (RTC) power procurement from grid-connected renewable energy projects, complemented with power from coal-based thermal power projects.
  • This notification is issued in pursuance of the Ministry of Power’s guidelines dated 22.07.2020 and amendment dated 03.11.2020 regarding tariff-based competitive bidding for RTC power.

Key Changes

  • The notification specifies annual escalation rates for various components relevant to power generation and transportation costs for bid evaluations opening up to 31.03.2024.
  • Escalation rate for domestic coal is set at 3.76%.
  • Escalation rate for domestic gas is set at 2.44%.
  • Escalation rates for inland transportation charges for coal vary based on distance: Upto 125 Km (12.81%), Upto 500 Km (8.74%), Upto 1000 Km (8.02%), Upto 2000 Km (6.02%), Beyond 2000 Km (5.51%).
  • Escalation rate for inland transportation charges for gas is set at 3.23%.
  • Escalation rate for imported coal is negative at -2.03%.
  • Escalation rate for imported gas is negative at -3.62%.
  • Escalation rate for transportation of imported coal is negative at -6.50%.
  • Escalation rate for transportation of imported gas is negative at -6.50%.
  • The discount rate to be used for bid evaluation is 7.70%.

Impact Analysis

Power Generation Companies

  • Action Items: Update financial models with the new escalation and discount rates. Re-evaluate existing bids and strategies based on these changes.

Renewable Energy Project Developers

  • Action Items: Analyze the impact of coal and gas price escalation on the overall tariff structure. Optimize project design and fuel sourcing strategies to mitigate cost increases.

Electricity Regulatory Bodies

  • Action Items: Implement the notified rates in bid evaluations. Monitor the effectiveness of these rates in promoting competitive bidding and ensuring affordable power supply.

Consumers

  • Action Items: Monitor the impact of these rates on electricity prices. Advocate for efficient power procurement practices to minimize cost increases.

Investors

  • Action Items: Incorporate these rates into investment appraisals. Assess the sensitivity of project returns to changes in fuel prices and transportation costs.

Key Entities Referenced

Central Electricity Regulatory Commission (CERC): The statutory body responsible for regulating the electricity sector in India, including tariff regulation and promoting competition. Ministry of Power: The government ministry responsible for the development of the power sector in India. Round-The-Clock (RTC) Power Projects: Power projects that combine renewable energy sources with thermal power to ensure continuous power supply. Guidelines for Tariff Based Competitive Bidding Process: The guidelines issued by the Ministry of Power on 22.07.2020 and amendment dated 03.11.2020, which govern the procurement of RTC power through competitive bidding.
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रजिस्ट्री स.ं डी.एल.- 33004/99 REGD. No. D. L.-33004/99 सी.जी.-डी.एल.-अ.-22042023-245344 xxxGIDHxxx CG-DL-E-22042023-245344 xxxGIDExxx असाधारण EXTRAORDINARY भाग III—खण् ड 4 PART III—Section 4 प्राजधकार स ेप्रकाजित PUBLISHED BY AUTHORITY स.ं 258] नई दिल्ली, िुक्रवार, अप्रलै 21, 2023/विै ाख 1, 1945 No. 258] NEW DELHI, FRIDAY, APRIL 21, 2023/VAISAKHA 1, 1945 dsUæh; fo|qr fofu;ked vk;kxs अजधसचू ना नई दिल्ली, 05 अप्रैल, 2023 la- bZdks&bZ@2023&dsfofovk.—fnukad 03-11-2020 ds la'kk/s ku ds lkFk ifBr **dk;s yk vk/kkfjr FkeZy ikoj ifj;kts ukvks a ls ikoj ds lkFk laijw d] fxzM lac) uohdj.kh; ÅtkZ fo|qr ifj;kts ukvks a ls jkm.M fn DykWd fo|qr dh izkfIr ds fy, VSfjQ vk/kkfjr izfrLi/kkZRed ckys h izfØ;k ds fy, ekxZfunZs'k** ij fnukad 22-07-2020 ls lacaf/kr fo|qr ea=ky; ds izLrko ds iSjkxzkQ 5-1 vkSj iSjkxzkQ 6-4 ds vuqlj.k es a dsUnzh; fo|qr fofu;ked vk;kxs cksyh ewY;kadu ds ç;kts u ds fy, fuEufyf[kr njks a vkSj vU; iSjkehVjksa dks vf/klwfpr djrk gSA I: cksyh ewY;kda u ds fy, okf"kZd o`f) njsa ¼31-03-2024 rd [kqyus okyh cksyh ds fy,½ ckys h ewY;kda u gsrq okf"kZd o`f) njsa Ø-l-a fooj.k ¼%½ 1- Lon's kh dks;yk ds fy, o`f) nj 3-76 2- Lon's kh xSl ds fy, o`f) nj 2-44 3- dks;ys ds vra nsZ'kh; ifjogu çHkkj gsrq o`f) njsa 3-1 125 fdyksehVj dh njw h rd 12-81 3-2 500 fdyksehVj dh njw h rd 8-74 3-3 1000 fdykes hVj dh njw h rd 8-02 3-4 2000 fdykes hVj dh njw h rd 6-02 3-5 2000 fdykes hVj dh njw h ls vkxs 5-51 2622 GI/2023 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC.4] 4- xSl ds fy, vra nZs'kh; ifjogu çHkkj grs q o`f) njsa 3-23 5- vk;kfrr dks;ys ds fy, o`f) nj (-)2-03 6- vk;kfrr xSl ds fy, o`f) nj (-)3-62 7- vk;kfrr dks;ys ds ifjogu ds fy, o`f) nj (-)6-50 8- vk;kfrr xSl ds ifjogu ds fy, o`f) nj (-)6-50 9- ckys h ewY;kadu ds fy, ç;qDr dh tkus okyh cV~Vk nj 7-70 gjizhr flag izqFkh] lfpo [जवज्ञापन-III/4/असा./39/2023-24] CENTRAL ELECTRICITY REGULATORY COMMISSION NOTIFICATION New Delhi, 5th April, 2023 No. Eco-E/2023-CERC.—In pursuance of paragraph 5.1 and paragraph 6.4 of the Ministry of Power’s Resolution dated 22.07.2020on “Guidelines for Tariff Based Competitive Bidding Process for Procureent of Round-The-Clock Power from Grid Connected Renewable Energy Power Projects, complemented with Power from Coal Based Thermal Power Projects” read with amendment dated 03.11.2020, the Central Electricity Regulatory Commission notifies the following rates and other parameters for the purpose of bid evaluation. I: Annual Escalation Rates for Bid Evaluation (for bid opening up to31.03.2024) Sr. Description Annual Escalation Rates for Bid No. Evaluation(%) 1 Escalation rate for domestic coal 3.76 2 Escalation rate for domestic gas 2.44 3 Escalation rate for inland transportation charges for coal 3.1 Upto125 Km distance 12.81 3.2 Upto 500 Km distance 8.74 3.3 Upto 1000 Km distance 8.02 3.4 Upto 2000 Km distance 6.02 3.5 Beyond 2000 Km distance 5.51 4 Escalation rate for inland transportation charges for gas 3.23 5 Escalation rate for imported coal (-)2.03 6 Escalation rate for imported gas (-)3.62 7 Escalation rate for transportation of imported coal (-)6.50 8 Escalation rate for transportation of imported gas (-)6.50 9 Discount rate to be used for bid evaluation 7.70 HARPREET SINGH PRUTHI, Secy. [ADVT.-III/4/Exty./39/2023-24] 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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