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Kerala State Electricity Board in ugly spat over tariff

The tariff will be decided on the basis of the capital cost of the project.

THIRUVANANTHAPURAM: Indian Renewable Energy Development Agency, which owns the 50-MW solar park in Kasargod, has sought a marginally higher tariff for the power it sells KSEB Limited. The mutually agreed tariff is Rs 4.95 per unit. Now, the IREDA says the tariff should be Rs 5.09 per unit. The State Electricity Regulatory Commission has scheduled a public hearing on June 6 to determine the tariff. The tariff will be decided on the basis of the capital cost of the project.

The IREDA argument is that the tariff of Rs 4.95 per unit as agreed in the Power Sale Agreement executed between KSEBL and IREDA on March 31, 2017, is less than the generic tariff specified for the 2016-17 fiscal by the Central Electricity Regulatory Commission guidelines. The rate of interest considered on the debt portion is also less than the rate of interest specified in the CERC Regulations. The Regulations also speak about “accelerated depreciation benefit”, which the IREDA argued was not taken into account while fixing the tariff.

In short, the tariff of Rs 4.95 agreed upon is less than the tariff of Rs 5.09 that could have been arrived at under the CERC regulations. The tariff is lower than the power from naphtha and diesel stations like NTPC Kayamkulam (Rs 7.27 per unit), Kozhikode Diesel Power Plant (Rs 5.79) and Brahmapuram Diesel Power Plant (Rs 6.56). However, it is higher than the power purchased from the short term exchange. As it stands, the IREDA is paid an interim tariff of below '4 per unit by the KSEBL.

“Once the ERC determines the new tariff, after the public hearing, the IREDA will be compensated with retrospective effect,” a top KSEBL official said. The total project cost works out to Rs 310.88 crore, and this included supply works, erection works and civil and allied works.

( Source : Deccan Chronicle. )
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