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Power Ministry seeks tariff rationalisation for hydropower projects

Tuesday, 19 Mar 2019
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The Ministry of Power sought the Central and State Electricity Regulatory Commission for enforcement of tariff rationalisation for hydropower projects.

The tariff rationalisation measures include -- providing flexibility to  developers to determine tariff by back loading of tariff after increasing project life to 40 years, increasing debt repayment period to 18 years and introducing escalating tariff of two percent.

The levelised tariff over the useful life of the project may be calculated on basis of the norms specified in the Central Electricity Regulatory Commission regulations.

The above measures are expected to bring down tariff for power generated from a new hydropower project.

Moreover, the Power Ministry has also notified the Hydropower Purchase Obligation as a separate entity within the Non-Solar Renewable Purchase Obligation. The obligation will cover all large hydropower projects commissioned after 8 March 2019. The capacity without PPAs of already commissioned projects will be able to avail this benefit.

All large hydropower projects have also been declared as renewable energy sources. However, new hydropower projects will not automatically be eligible for any differential treatment for statutory clearances.

 
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