multi-year tariff petition - hpptcl.com ea 2003 electricity act 2003 g,t and d generation, ... 5...

Multi-Year Tariff Petition For 3rd Control Period for

220/33 kV S/Stn at Karian & 220 kV Transmission Line from

Karian to Chamera-II

(FY 2014-15 to FY 2018-19)

MYT Petition for 3rd Control Period (FY 2014-15 to FY 2018-19) for 220/33 kV S/stn at Karian & 220 kV transmission line from Karian to Chamera-II

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Table of contents

1. Background ................................................................................................................. 2

1.1 About H.P. Power Transmission Corporation Limited (HPPTCL) .......................... 2

2. Infrastructure Details .................................................................................................. 3

2.1 Current Infrastructure ............................................................................................... 3

2.2 Upcoming Projects ...................................................................................................... 4

3. Asset under consideration (Karian Chamera Inter-State Line & Sub-Station) ................ 7

3.1 Why the asset comes under CERC’s purview? ......................................................... 8

3.2 Brief description of the asset ..................................................................................... 9

3.3 Approach of the MYT Petition ................................................................................. 10

4. Aggregate Fixed Charges for FY 2014-15 to FY 2018-19 ............................................... 11

4.1 Components of Transmission Tariff........................................................................ 11

4.2 Operation and Maintenance expenses (O&M) ....................................................... 11

4.3 Depreciation .............................................................................................................. 12

4.4 Interest & Finance Charges ...................................................................................... 12

4.5 Interest on Working Capital .................................................................................... 13

4.6 Return on Equity ....................................................................................................... 13

4.7 Aggregate Revenue Requirement............................................................................ 14

5. Tariff Determination for FY 15 to FY 19 ...................................................................... 15

6. Prayer ....................................................................................................................... 16

7. Annexure .................................................................................................................. 17

Annexure 1 - BoD Approval ............................................................................................. 18

Annexure 2 - MYT formats .............................................................................................. 19

Annexure 3 – NRPC Committee Approval ...................................................................... 20

Annexure 4 – Single Line Diagram of the Asset ............................................................. 21


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List of Tables

Table 1: 220/33 kV KARIAN SUB-STATION .............................................................. 7 Table 2: Existing status on CoD, PPAs ...................................................................... 10 Table 3: Projected O&M expenses for the Control Period ...................................... 12 Table 4: Details of Depreciation over the Control Period ...................................... 12 Table 5: Interest on Loan for the Control Period .................................................... 12 Table 6: Details of Interest on Working Capital over the Control Period ............. 13 Table 7: Details of Return on Equity over the Control Period ............................... 14 Table 8: Summary of Aggregate Revenue Requirement for 3rd Control Period .. 14 Table 9: Summary of Tariff Determination for 3rd Control Period ...................... 15


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Abbreviations

Acronyms Definition A&G Expenses Administrative & General Expenses ADB Asian Development Bank CEA Central Electricity Authority CERC Central Electricity Regulatory Commission CPP Captive Power Plant Ckt. Kms. Circuit Kilometers Discom Distribution Company EA 2003 Electricity Act 2003 G,T and D Generation, Transmission and Distribution GIS Gas Insulated Sub-station GoHP Government of Himachal Pradesh GFA Gross Fixed Assets HEP Hydro Electric Project HPERC H.P. Electricity Regulatory Commission HPPTCL H.P. Power Transmission Corporation Limited HPSEBL H.P. State Electricity Board Limited INR Indian Rupee IPPs Independent Power Producers ISTS Inter-state Transmission System LILO Loop In Loop Out MU Million Units MYT Multi-Year Tariff ND Normal Development O&M Operations and Maintenance PE Power Evacuation PSU Public Sector Undertakings PGCIL Power Grid Corporation of India Limited REC Rural Electrification Corporation R&M Expenses Repair & Maintenance Expenses RoE Return on equity T&D Transmission and Distribution R&M Repairs & Maintenance S/S Sub Station STU State Transmission Utility USD Unites States of America Dollar

BEFORE THE CENTRAL ELECTRICITY REGULATORY COMMISSION

NEW DELHI

PETITION NO.: ….. IN THE MATTER OF: Approval under CERC (Terms and Condition of Tariff) Regulations, 2014 for determination of Transmission Tariff for: Asset: 220/33 kV S/Stn at Karian & 220 kV Transmission Line from Karian to

Chamera-II associated with 220 kV system for Northern Grid, for Tariff block 2014-19 period in Northern Region.

IN THE MATTER OF: H.P. Power Transmission Corporation Limited ------- Petitioner Registered office: Barowalias House,

Khalini, Shimla-2


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1. Background

1.1 About H.P. Power Transmission Corporation Limited (HPPTCL)

1.1.1 H. P. Power Transmission Corporation Limited (HPPTCL) was established on August 27th 2008, as an undertaking of Government of Himachal Pradesh with a view to strengthen the transmission network in the state of Himachal Pradesh and to facilitate the evacuation of power from upcoming generating power plants. H. P. Power Transmission Corporation Limited was formed through an order notified by the State Government, No. -MPP-A-(1)-4/2006-Loose, dated September 11, 2008.

1.1.2 Through notification No-MPP-A-(1)-4/2006-Loose, dated 3rd December, 2008 of the Government of Himachal Pradesh, HPPTCL was entrusted with the following works / business with immediate effect:

o All new works of construction of Sub-Stations of 66 KV and above. o All new works of laying/ construction of transmission lines of 66 KV and

above. o Formulation, updation, execution of Transmission Master Plan for the

State for strengthening of Transmission Network and evacuation of power including new works under schemes already submitted by the Board under this Plan to the Financial Institutions for funding and where loan agreements were not yet signed.

o All matters relating to Planning and Co-ordination of the Transmission related issues with CTU, CEA, Ministry of Power, State Government and HPSEBL.

o Planning and co-ordination with the IPPs / CPSUs / State PSUs / Other Departments or organizations or agencies of the Central Government and State Government, HPSEBL and HPPCL with regard to all Transmission related issues.

o All other matter of subject which the State Government may specifically assigned to HPPTCL from time to time.

1.1.3 HPPTCL was declared State Transmission Utility (STU) vide notification no. MPP-

A (3)-1/2001-iv dated June10, 2010 by the Government of Himachal Pradesh and as a result thereof the H.P. Electricity Regulatory Commission (HPERC) recognized the HPPTCL as deemed “Transmission Licensee” as per the Commission’s order dated 31.07.2010 in petition No. 32 of 2010 filed by HPPTCL under section 14 and 15 of the Electricity Act, 2003.


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2. Infrastructure Details

2.1 Current Infrastructure

2.1.1 The details of the Transmission Lines vested in the HPPTCL as per Government Orders dated 21.06.2010 are as under:

Sr.No. Name of Line Gross Fixed Asset

(Rs Lacs)

Commercial Operation

Date Line Length

(Kms)

A. 220 KV/Lines

1 220 KV D/C Bairasuil Pong line (one Ckt LILO at Jassure) 19.47 09/1985 0.240

2 220 KV S/C Jassure Thein Line 1900.11 03/2001 25.602 3 220 KV S/C line on D/C towers Dehar

to Kangoo line 149.43 06/1999 3.177 4 220 KV D/C Panchkula Kunihar Line 8535.74 05/1989 46.720 5 220KV D/C Khodri-Giri line 6398.15 09/1989 35.02 6 220KV D/C Nalagarh(PGCIL) to

Nalagarh Line 639.45 07/2010 3.500

Sub-Total (A): 17642.35 114.259 B. 132KV Lines 1 132 kV S/C Giri- Kulhal Line 23.66 04/1978 17.40 2 132KV D/C Giri-Abdullapur line 1348.20 08/1982 16.220 3 132KV S/C Kangra Tap 10.00 02/1979 0.135 4 132KV S/C Dehar Kangoo Line 86.10 12/1998 2.992 5 132 KV D/C Shanan – Bassi Line 11.55 03/1970 5.00 Sub-Total (B): 1479.51 41.747

C. 66 KV Lines 1 66 KV Shanan-Bijni Line 10.50 10/1969 35.00 2 66 KV Pinjore-Parwanoo Line 574.20 04/1956 8.230 3 66 KV Pong-Sansarpur Terrace line 43.40 10/1990 6.300 4 66 KV Bhakra-Una LILO Gwalthai line 192.97 12/1985 16.724 Sub-Total (C): 821.07 66.254 Total (A+B+C) 19942.93 222.26

2.1.2 Out of the above mentioned transmission lines, three transmission lines are

inter-state lines as per CERC Order in petition No. 15/Suo-Motu/2012. The details of those lines are as follows:

Sr.No. From To Voltage (kV) Connecting States

1. Majri Khodri 220 Himachal Pradesh- Uttarakhand

2. Jassure Ranjitsagar 220 Himachal Pradesh- Punjab

3. Kunihar Panchkula 220 Himachal Pradesh- Haryana


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2.2 Upcoming Projects

2.2.1 Government of Himachal Pradesh had put forward the Hydro Power Policy in

2006. The highlights of hydro policy are as follows: • Selection of Developer on MOU Route allowed for projects up to 100 MW • Selection of Developer on ICB route for Projects above 100 MW • No Clearances necessary from CEA for projects selected on competitive

bidding route for projects costing up to Rs. 2500 Cr • Secondary energy rate to be at par with primary energy. Premium on peak

power proposed • Process of Transferring clearances to IPP’s simplified • 100% Foreign Equity permitted on the automatic approval route provided it

does exceed Rs. 1500 Cr • Limit of 40% financing from Indian Financial Institutions waived off. • Tariff determination by SERC/CERC • Projects up to 25 MW to be transferred to MNES • HPSEB to purchase power @ Rs. 2.50/kWh from projects up to 5 MW capacity

banking & wheeling facilities permitted @ 2% including transmission losses • Incentives for small HEP as per GOI Guidelines • Moratorium of 5 years for payment of Electricity duty by companies which

consume electricity produced by them

2.2.2 In line with the hydro policy, HPPTCL has formulated a Power System Master Plan (PSMP) of transmission projects for evacuation of power from Hydro Electric Projects planned in five river basins. The Master Plan was fine tuned by BPI (British Power International), a consultant appointed by Asian Development Bank (ADB) under its Technical Assistance and estimated the investment required up to the year 2016-17 as 1270 Million US Dollars.

2.2.3 On the request of HPPTCL through Government of Himachal Pradesh and Government of India, ADB agreed to finance transmission projects in multi-tranche funding arrangement to the tune of 350 Million US Dollars under LIBOR based lending facility. This amount is to be given to Government of Himachal Pradesh by Government of India as 90% grant and 10% loan and the same is to be transferred to HPPTCL by Government of Himachal Pradesh as loan.

2.2.4 Loan agreement for Tranche – I transmission projects amounting to 113 Million US Dollars (80% of the total project cost) was signed in December 2011 and came into effect from 19.01.2012. Loan negotiations for Tranche–II amounting to $ 110 Million (75% of the total project cost) were concluded in February, 2013 and loan signing is executed on 29th September, 2014. Transmission projects to be implemented in Tranche-III have been firmed up and DPRs prepared and submitted to CEA for techno-economic clearance.

2.2.5 Some of the transmission projects of urgent nature are being executed by domestic borrowings from REC as 70% loan and 30% equity basis to meet the timelines of commissioning of Hydro Electric Projects in Chamba and Kullu district.


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2.2.6 All the transmission projects included in the Capital Investment Plan are planned

for evacuation of power from various small and large Hydro Electric Projects being developed in the state of Himachal Pradesh by various PSUs and IPPs. Investment in these transmission projects have been approved by the Board of Directors of HPPTCL.

2.2.7 Details of the projects are as follows:

S. No.

Name of Project

Potential to be evacuated (MW)

Distt.

Capital Cost (Rs. Crore)

Target COD

Source of Funding Status

1. PALCHAN VALLEY 35.07 Kullu

i 33 kV D/C Line between Palchan and 33/220 kV sub-station in the yard of Allain Dhuangan HEP

5.55 Dec, 2014

Domestic (REC)

Work awarded and is under implementation

2. NAGGAR VALLEY 88.6 Kullu

i 33/220 kV, 100 MVA GIS sub-station at Fozal 62.3 Dec,

2014 Domestic (REC)


ii LILO of one circuit of 220 kV Prini- Nalagarh D/C Line of M/S AD Hydro

8 Dec, 2014

Domestic (REC)


3 UPPER PARVATI VALLEY

58 Kullu

i 33/132 kV, 2x31.5 MVA GIS sub-station at Barsaini 48.5 March,

2016

ADB (Tranche-II)

Land acquisition and survey in progress

ii

132 kV D/C transmission Line between Barsaini and 132/220 kV sub-station at Charor

64.5

April, 2016

ADB (Tranche-II)


4 LOWER PARVATI VALLEY

290 Kullu

i 132/220 kV, 2x100 MVA GIS sub-station at Charor 71 May,

2016

ADB (Tranche-II)


ii

220 kV D/C (Twin MOOSE) transmission Line between Charor Sub-station and 400/220 kV sub-station of PGCIL at Banala

45 April, 2016

ADB (Tranche-II)


5 MID BEAS VALLEY 54 Mandi

i

33/132 kV GIS 2x31.5 MVA (31.5 MVA in Ist stage) sub-station at Pandoh by LILO of 132 kV Bajaura-Kangoo D/C line

42 Jan, 2016 ADB (Tranche-II)

Land acquisition in progress.


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S. No.

Name of Project

Potential to be evacuated (MW)

Distt.

Capital Cost (Rs. Crore)

Target COD

Source of Funding Status

6 LOWER BEAS VALLEY

43 Kangra

i

33/132 kV, 2x31.5 MVA GIS sub-station at Chambi (Shahpur) with LILO of 132 kV Dehra- Kangra S/C Line

49

Feb, 2016

ADB (Tranche-II)

Land acquisition and Survey in Progress

7 PALAMPUR ZONE 436 Kangra

i 132/220 kV, 2x80/100 MVA GIS Sub Station at Dehan 109 June,

2017

ADB (Tranche-III)

DPR sent to CEA for approval

ii

220 kV D/C (Twin MOOSE) transmission Line from Dehan to 220/400 kV PGCIL sub-station at Hamirpur

163 June, 2017

ADB (Tranche-III)

DPR sent to CEA for approval

8 CHAMBA VALLEY 29.52 Chamba

i 220 kV line from Karian to Chamera-II 29.52 Dec,

2014 REC Work awarded and is under implementation

Ii Sub-Station at Karian Dec’2014 REC Work awarded and is under implementation


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3. Asset under consideration (Karian Chamera Inter-State Line & Sub-Station)

3.1.1 The current MYT petition is for 220/33 kV S/stn at Karian & 220 kV transmission line from Karian to Chamera-II connecting states of Himachal Pradesh and Punjab. The asset is expected to be commissioned by December 2014.

3.1.2 The Petitioner submits that it has already entered into an agreement with various IPPs for construction of 6 bays of 33kV. However, the cost of such bays are yet to be determined and thus, the same could not be recovered from IPPs. The cost shall be recovered once the cost of the bays is determined and the same shall be adjusted from the ARR as submitted in this Petition.

Table 1: 220/33 kV KARIAN SUB-STATION

Bay - 1 & 2

Name of Project Capacity Mode Connectivity

Status

Open Access Status

Status of PPA Remarks

Kurtha (Incharge)

5.0 MW Joint

Mode Taken Not Applied

Under Process with

HPSEBL

Cost of bay Not Demanded

Kuril 5.0 MW ----Do-- Not applied --DO--- -- --

Kiri 1 MW ----do---- --do-- --do-- -- --

Sal-II (Sahu) 3 MW ----do--- --do-- --do-- PPA with HPSEBL --

Bay - 3 & 4 (HPSEBL)


Status Open Access

Status Status of

PPA Remarks

Dunali 5.0 MW joint Interfaced with HPSEBL Not applied PPA with

HPSEBL Power to be Drawn

Balij Ka Nalah-II

3.5 MW --do-- ---DO---

Belij 5.0 MW --do-- ---DO---

Bay - 5 & 6


Status Open Access

Status Status of

PPA Remarks

Hared 3.0 Joint Not Applied Not Applied

Not Applied

Balij Ka Nalah-III

3.0 -----do---- --do---

Baleni Ka Nallah

2.0 ---do---- ----do----

Mehled 3.0 ---do---- ---do----

Balij Top 2.0 ---do--- ----do----

Belij Ka Nalla 2.0 ---do--- ----do-----


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Status Open Access

Status Status of

PPA Remarks

Daredi

4.0 ---do--- ----do----

Durghed 1.1 --do--- ---do---

3.1.3 Relevant details of the asset are presented in the table below:

S. No.

Name of Transmission line

Type of line (AC/ HVDC)

S/C or

D/C

No. of Sub-Conductors

Voltage level kV

Line length (Ckt. Km.)

COD

1 Karian to Chamera AC S/C 1 220 3.5 31-Dec-14

S.No. Name of Sub-Station

Type of Substation

Voltage level KV

No. of Bays

COD 765 KV 400KV 220KV 132KV&

below

1 Karian-Chamera GIS 220 3 9 31-Dec-14

3.1 Why the asset comes under CERC’s purview?

3.1.1 The petitioner believes that the asset under consideration comes under purview

of CERC. As per the definition of “Inter-State transmission system” under Section 2 (36), of the Electricity Act 2003, reproduced as under

“2(36) inter-State transmission system includes-

(i) Any system for the conveyance of electricity by means of main transmission line from the territory of one State to another state;

(ii) the conveyance of electricity across the territory of any intervening State as well as conveyance within the State which is incidental to such inter-State transmission of electricity;

(iii) the transmission of electricity within the territory of a State on a system built, owned, operated, maintained or controlled by a Central Transmission Utility;”

3.1.2 As per the second definition mentioned above, any transmission line that is incidental to inter-state transmission network shall be treated as inter-state transmission system. Further, it is also stated that in terms of Section 79(1) (d) of the Act, the tariff of these lines are required to be determined by the Central Commission.


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3.1.3 It was also stated that some of the owners/developers of the inter-State transmission lines of 132 kV and above in North Eastern Region and 220 kV and above in Northern, Eastern, Western and Southern regions have approached the implementing Agency for including their transmission assets in computation of Point of Connection under CERC (Sharing of inter-State Transmission Charges and Losses) Regulations, 2010.

3.1.4 The asset under discussion i.e. Karian Chamera line & substation is incidental to

the inter-state transmission network as it will evacuate power developed from upcoming Hydro generation & other generation within the state & further it will connect PGCIL’s 220 kV Polling station, which will evacuate power through PGCIL’s Jallandhar line.

3.2 Brief description of the asset

3.2.1 Below mentioned is the Network flow diagram for evacuation plan of projects in

Ravi Basin:

3.2.2 Power generated from Kiri, Kurli, Kurta, Hard & Mehled HEPs (around 17 MW) will connected to 33/220 kV Karian Substation. Power generated from Sal-II, Dikleri, Sahoo, Hul-I, Hul-II & Sal-I around 22.4MW will connect via HPSEBL 33kV Chamba sub-station to 33/220 kV Karian Substation.

3.2.3 Power generated from Belij-III, Belij-II, Belij-I, Gehra, Baleni ka Nalla & Dunali around 20.5 MW will flow via generator’s 33kV Kunali P.S and then will connect


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to HPSEBL 33kV Jarangla sub-station and from there it will finally connect to 33/220 kV Karian sub-station.

3.2.4 Power generated from Daredi, Durghed will flow to HPSEBL 33kV Jarangla sub-station, from there it will connect to 33/220kV Karian Sub- station. Dunali, Balij ka Nalah, Belij & Kurta are commissioned. PPA for Sal-II is signed and PPA for rest of the projects is under process.

3.2.5 Overall plan of the projects to be connected with the Karian Chamera sub-station are as follows:

Table 2: Existing status on CoD, PPAs

S. No

Name of project

Installed Capacity

(MW) Benefits COD PPA

with PPA

Status

2012 2013 2014 2015 2016 2017 13th Plan

1 DUNALI 5 5 Yes HPSEBL Done

2 BALIJ KA NALAH 3.5 3.5 Yes HPSEBL Done

3 GEHRA 2 2 4 BELIJ 5 5 Yes HPSEBL Done 5 HARED 3 3

6 BALIJ KA NALAH-III 3 3

7 BALENI KA NALLAH

2 2

8 MEHLED 3 3 9 BALIJ TOP 2 2

10 BELIJ KA NALLA 2 2

11 DAREDI 4 4 12 DURGHED 1.1 1.1

13 SAL-II (SAHU) 3 3 HPSEBL Done

14 KIRI 5 1 15 KURIL 5 5 16 KURTHA 5 5 Yes HPSEBL In process

3.3 Approach of the MYT Petition

3.3.1 The Petitioner is filing petition for determination of tariff for 220/33 kV S/stn at

Karian & 220 kV transmission line from Karian to Chamera-II in accordance with the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2014


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4. Aggregate Fixed Charges for FY 2014-15 to FY 2018-19

4.1 Components of Transmission Tariff

4.1.1 This Chapter summarizes the Aggregate Fixed Charges for the 3rd Control Period FY 2014-15 to FY 2018-19. The projections for the Control Period have been made as per the CERC (Terms & Conditions for Tariff) Regulations, 2014.

4.1.2 Total fixed cost for the Control Period has been bifurcated into following elements:

• O& M Expenses; • Depreciation; • Interest and Financing Charges; • Return on Equity; • Interest on Working Capital;

4.2 Operation and Maintenance expenses (O&M)

4.2.1 While calculating the total O&M expenses incurred for inter-state transmission

lines, normative operation and maintenance expenses admissible for the transmission system as per the CERC (Terms & Conditions of Tariff) Regulations 2014 have been considered for Single Circuit (Single Conductor) & Double Circuit (Single Conductor).

4.2.2 Clause (3)(a) of Regulation 29 of the CERC (Terms & Conditions of Tariff)

Regulations 2014 prescribes the norms for operation and maintenance expenses for the transmission system based on the type of sub-station and type of AC/HVDC line. Norms prescribed in respect of the elements covered in the instant petition are as under:-

4.2.3 Since the O&M norms for 220 & 33 kV GIS sub-stations are not mentioned in CERC (Terms & Conditions of tariff) Regulations, 2014, the Petitioner has considered the general O&M norms for the Transmission System as provided by CERC in the clause 29 (3) of CERC (Terms & Conditions of tariff) Regulations, 2014.

4.2.4 However, the Petitioner believes that the cost of GIS sub-stations should be lesser than the cost as considered in the Petition as per the clause 29 (3) of CERC (Terms & Conditions of tariff) Regulations, 2014. Thus, the Petitioner requests the Hon’ble Commission to take a prudent view on the cost of the aforesaid GIS sub-stations & bays.


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4.2.5 Total O&M Expense for the Control Period is as follows:

Table 3: Projected O&M expenses for the Control Period

FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19 For Sub-Station

220 kV (3 bays) 31.66 130.83 135.18 139.65 144.30 33 kV (9 bays) 67.84 280.35 289.62 299.25 309.24

For Transmission Line

220 kV (3.5 kms) 0.27 1.10 1.13 1.17 1.21 Total 99.76 412.28 425.93 440.07 454.75

Note: O&M expense for FY15 is for only 3 months

4.3 Depreciation

4.3.1 The gross value of transmission lines i.e. 220/33 kV S/stn at Karian & 220 kV transmission line from Karian to Chamera-II is INR 3507 Lac.

4.3.2 Depreciation is calculated based on straight line method for each year & as per rate specified in Appendix II of the CERC Regulations. For FY 2014-15 depreciation is calculated only for 3 month since the COD of line is expected on 30th December, 2014. From FY 2015-16 onwards, depreciation is calculated annually.

4.3.3 The depreciation for the control period is presented in the table below –

Table 4: Details of Depreciation over the Control Period

(INR Lac) FY 2014-15

FY 2015-16

FY 2016-17

FY 2017-18

FY 2018-19

Depreciation 41.34 165.37 165.37 165.37 165.37

Note: Depreciation for FY15 is for only 3 months

4.4 Interest & Finance Charges

Interest on loan is calculated as per the regulation 26 of the CERC regulations. As per the sub-regulations (3) and (4) of the regulation 26, repayment of the loan is equal to the depreciation of that year and repayment shall start from first year of the commercial operation of the project.

Table 5: Interest on Loan for the Control Period

(INR Lac) FY 2014-15

FY 2015-16

FY 2016-17

FY 2017-18

FY 2018-19

Interest on Loan 76.07 291.38 270.71 250.04 229.37

Note: Interest on Loan for FY15 is for only 3 months


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4.5 Interest on Working Capital

4.5.1 Working capital for transmission under the CERC (Terms & Conditions for Tariff) Regulations 2014 covers – 1. Receivables equivalent to two months of fixed cost.

2. Maintenance spares @ 15% of operation and maintenance expenses

3. Operation and maintenance expenses for one month.

4. Rate of interest on working capital shall be on normative basis and shall be considered as the bank rate as on 1.4.2014 or as on 1st April of the year during the tariff period 2014-19 in which the generating station or a unit thereof or the transmission system including communication system or element thereof, as the case may be, is declared under commercial operation, whichever is later.

4.5.2 As per the CERC regulation (the working capital interest rate is equal to “Base Rate of the State Bank of India plus 350 basis points”. The average SBI Base Rate for the last 6 months is 9.80%. Hence, interest rate on working capital comes out to be 13.30%.

4.5.3 The interest on working capital for the Control Period is as outlined below:

Table 6: Details of Interest on Working Capital over the Control Period

Details (INR Lac) FY 2014-15

FY 2015-16

FY 2016-17

FY 2017-18

FY 2018-19

O&M expenses for 1 month 33.25 34.36 35.49 36.67 37.90 Maintenance spares @15% of R&M expenses for 1 month

14.96 61.84 63.89 66.01 68.21

Receivable for 2 months 170.21 192.41 191.29 190.25 189.31

Total Working capital 218.43 288.61 290.67 292.93 295.41 Interest on Working capital 7.26 38.38 38.66 38.96 39.29

Note: Interest on Working Capital for FY15 is for only 3 months

4.6 Return on Equity

4.6.1 As per the CERC (Terms & Conditions for Tariff) Regulations, 2014, Return on

Equity is mentioned as – “Return on equity shall be computed in rupee terms, on the equity base determined in accordance with regulation 19. Return on equity shall be computed at the base rate of 15.50% for thermal generating stations, transmission system including communication system and run of the river hydro generating station, and at the base rate of 16.50% for the storage type hydro generating stations including pumped storage hydro generating stations and run of river generating station with pondage”.


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4.6.2 The total return on equity calculated based on the invested equity of INR 1052 Lac is as follows:

Table 7: Details of Return on Equity over the Control Period

INR Lac FY 2014-15

FY 2015-16

FY 2016-17

FY 2017-18

FY 2018-19

30.88 247.06 247.06 247.06 247.06

Note: Return on Equity for FY15 is for only 3 months

4.7 Aggregate Revenue Requirement

4.7.1 The table given below summarizes the ARR of HPPTCL under MYT projection for

the third Control Period FY 2014-15 to 2018-19.

Table 8: Summary of Aggregate Revenue Requirement for 3rd Control Period

(INR Lac) FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19

Depreciation 41.34 165.37 165.37 165.37 165.37 Interest on Loan 76.07 291.38 270.71 250.04 229.37 Return on Equity 30.88 247.06 247.06 247.06 247.06 Interest on Working Capital

7.26 38.38 38.66 38.96 39.29

O&M Expenses 99.76 412.28 425.93 440.07 454.75 Aggregate Revenue Requirement

255.32 1154.47 1147.73 1141.49 1135.84


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5. Tariff Determination for FY 15 to FY 19

5.1.1 HPPTCL recovers all of its costs through transmission charges that are charged to the users of the transmission network of HPPTCL. These costs have been calculated and projected in the previous chapter. Apart from the operational and financial costs, HPPTCL is also eligible to earn a pre-tax rate of return on equity at 23.48% as per the provisions of the CERC Terms and Conditions of Tariff, 2014.

5.1.2 The contracted capacity over the MYT period for the transmission network is based on the proposed increase in generation capacity that shall be transferred to inter-state network.

5.1.3 The tariff in INR/ MW/ month has been worked out in the following table:

Table 9: Summary of Tariff Determination for 3rd Control Period

Particulars FY 2014-15

FY 2015-16

FY 2016-17

FY 2017-18

FY 2018-19

Aggregate Revenue Requirement (in INR Lac) 255.32 1154.47 1147.73 1141.49 1135.84

Transmission Capacity (in MW) 18.5 28.5 30.5 30.5 49.5 Transmission charges (in INR/ MW/ month) 115009 337564 313587 311883 191218


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6. Prayer

HPPTCL respectfully prays to the Hon’ble Commission: 1. Approve the Transmission Tariff for the asset covered under this petition.

2. Approve the reimbursement of expenditure by the beneficiaries towards petition filing fee, and publishing of notices in newspapers in terms of Regulation 52 of CERC (Terms and Conditions of Tariff) Regulations, 2014 and other expenditure (if any) in relation to the filing of petition.

3. Allow the Petitioner to bill and recover Service tax on Transmission Charges separately from the respondents, if at any time exemption from service tax is withdrawn and transmission is notified as a taxable service.

4. And pass such other relief as Hon’ble Commission deems fit and appropriate under the circumstances of the case and in the interest of justice.

Applicant


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7. Annexure


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Annexure 1 - BoD Approval

Attached herewith


HPPTCL

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Annexure 2 - MYT formats

Attached herewith


HPPTCL

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Annexure 3 – NRPC Committee Approval


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Annexure 4 – Single Line Diagram of the Asset

multi-year tariff petition - hpptcl.com ea 2003 electricity act 2003 g,t and d generation, ... 5...

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