KERC revises power purchase tariff for renewable energy

KERC revises power purchase tariff for renewable energy

New tariff effective from January 1, this year

The Karnataka Electricity Regulatory Commission (KERC) has revised the tariff for procuring renewable energy from mini hydel power (MHP) units, co-generation and biomass power plants, effective from January 1, 2015.

Speaking to reporters here on Friday, M R Sreenivasamurthy, Chairman, KERC, said that the Commission, after conducting a hearing in this connection, had allowed a hike of 25 per cent for MHPs and co-generation units. The purchase tariff for power plants which use biomass as fuel will go up by 42 per cent, he said.

Accordingly, the utilities have to pay Rs 4.16 per unit of power purchased from the MHPs against the present rate of Rs 3.40. The bagasse-based co-gen units will be paid Rs 4.83 per unit of power for the first year of the commissioning of the project.

16 paise per unit

“They will be getting an increase of 16 paise per unit of power every year over next three years. Earlier, the rate for each unit of energy from co-generation units was Rs 3.90, with an increase of five paise per unit for a period of ten years,” said Sreenivasamurthy.

Similarly, the biomass units which use wood chips, paddy, husk, crop residues like cotton and jowar stalk, will be getting Rs 5.19 per unit of power, against the existing Rs 3.66 and there will be an increase of 16 paise per unit every year, against the earlier five paise per unit.

New power projects

The KERC chairman pointed out that the new tariff will apply only to those power projects which will be commissioned between January 1, 2015 and March 31, 2018.

“The tariff revision is due to increase in the cost of fuel (raw material) and it applies to those projects which use fuel and to those which have to meet the maintenence of machinery. Even the mini hydel projects, which do not use fuel to generate power, have not got the annual increase in tariff than the fixed hike, unlike the other two renewable power generators,” said Sreenivasamurthy.

The KERC chairman also said that the new tariff applies only to long-term power purchase agreements and not for the short-term power purchases.

The State has an installed capacity of 4,400 megawatt (MW) of renewable energy and nearly 440 MW of energy is added to it every year.

On use of coal by the co-generation units, Sreenivasamurthy said that the Ministry for Non-Conventional Energy has permitted the use of 15 per cent of coal and the units using in excess will not be considered as renewable energy units.

When questioned about the revision of power tariff  sought by the electricity supply companies, he said that the hearing will begin after a month once the consumers’ objections were scrutinised.