Cement, Energy & Environment

investment, Section 86 enable state commissions to create a market for RE and co-generation projects by prescribing a minimum percentage of electricity to be procured from non-conventional energy sources. The other important aspect of Section 86(1 )e is about providing grid connectivity to renewable energy power plants. The policies formulated to promote renewable energy development also include the National Electricity Policy and Tariff Policy. The National Electricity Policy, formulated by the Ministry of Power, in pursuance of the provisions of the Electricity Act, 2003, provides direction on determination of percentage for renewable power procurement. The policy also provides a roadmap for gradually increasing the share of renewable power generation thereby requiring the various state comm1ss1ons to provide increasing percentages for procurement of power from renewable energy sources . The Tariff Policy on the other hand gives guidance on the most critical issue of tariff for power purchase from renewable energy sources. It recommends 'preferential tariff for purchase of power from renewable energy sources as well as lays out a long-term strategy for pricing of power from RE sources . The tariff orders issued by different state electricity regulatory commissions have 3-5 years of control period. At the end of the control period the tariff is revised based on the new cost and performance parameters. As per Section 86(1 )e of the Electricity Act, 2003, different state electricity regulatory commissions have fixed a percentage of electricity which should be purchased from renewable energy sources. Table 4 shows the percentages specified, tariff fixed by commission, validity period and charges for captive users in the states with high wind power potential. The RPO obligation is also applicable to captive generators. Some of the important regulations issue by the Central Electricity Regulatory Commission (CERC) to drive development in the wind power sector are summarized below: Table 4: Regulatory parameters for the year 2012·13 for wind energy State RPS per Tariff fixed by Validity Charges for captive users cent commissions in INR per of Tariff 0 A (OA) 8 k" specified kWh (Years) penChccess an mg arges Tamil Nadu 9 per cent 3.39 (fixed) 20 5 per cent of energy in 5 per cent case of consumption at HVIEHV and 7.5 per cent in case of LV - Maharashtra 7 per cent 5.67 (Wind zone 1 -CUF Actual OA charge Allowed 20 per cent) 4.93 (Wind zone 2- CUF 13 23 per cent) 4.20 (Wind zone 3- CUF 27 per cent) 3.78 (Wind zone 4- CUF 30 per cent) -- Karnataka 7-10 per cent 3.70 10 5 per cent of energy 2 per cent of 1- energy input Andhra Pradesh 5 per cent 3.50 10 Actual OA charge Allowed ·- - Rajasthan 4.5 per cent 4.22 for Jaipur and 20 50 per cent of normal OA Allowed Barmer districts, 4.44 for charges rest of Rajasthan -~ Madhya Pradesh 2.5 percent 4.35 25 2 per cent plus Allowed transmission charges ·- Kerala 3.3 per cent 3.64 (fixed) 20 5 per cent of energy Allowed (June-feb) Haryana 10 per cent 4.08 (with 1.5 per cent 5 2 per cent of energy Allowed escalation per year, base under OA charges year 2007 -08) Gujarat 5 per cent 3.56 25 Transmission charges and 4.40 per cent as transmission losses for 66 kV and above Monthly Transmission charges Settlement and 10 per cent as transmission losses and wheeling charges for below than 66kV* 26 I