The document outlines new tariff guidelines and regulatory frameworks by the Central Electricity Regulatory Commission (CERC) to enhance renewable energy in India, covering wind and solar energy. It details eligibility criteria, operational frameworks, and the Renewable Energy Certificate (REC) mechanism, aiming for significant solar generation capacity increases by 2020, 2030, and 2050. The National Solar Mission sets ambitious renewable energy targets while ensuring regulatory clarity and financial principles for tariff determination.

1. Sep 09Renewable Energy – New Tariff Guidelines & REC FrameworkSaurabh MehtaAsst. Manager (BD – Projects)Reliance Power

2. Flow of presentationCERC’s new regulation

3. Background

4. Salient Features

5. Wind Energy

6. Solar Energy

7. National Solar Mission

8. Renewable Energy Certificate (REC)

9. Background

10. REC Concept

11. Operational FrameworkCERC’s new RegulationBackground – Pre regulation scenarioWind EnergyDifferent Tariff regimes for different statesLarge variations – Rajasthan Rs 4.28 / Unit v/s Tamilnadu Rs. 3.39 / UnitSimilar tariff for different wind zones in a stateNo clarity for CDM Benefits sharingFixed project cost without any indexingFixed ROE throughout the project lifeSolar EnergyDifferent Tariff regimes for different statesNo clarity of tariff determination methodologyLarge portions of tariff (Rs. 10 to 12) to come from GOI as Generation Based Incentive (GBI)CERC’s new regulation addresses the issues of Renewable Energy Tariff Determination

12. CERC’s new RegulationSalient FeaturesEligibility criteria

13. CERC’s new regulationSalient Features contd.Review Period –3 years Tariff Period – Small Hydro Projects : 35 years Solar PV & Solar Thermal : 25 years Other RE Projects : 13 yearsUseful life –Wind Projects : 25 yearsBiomass Projects : 20 yearsSmall Hydro Projects : 35 yearsSolar PV / Solar Thermal Projects : 25 yearsProject Specific Tariff – May be determined by commission on case to case basis for the following;Hybrid Solar Thermal Power PlantsMunicipal solid waste projectsAny other new renewable technology

14. CERC’s new regulationSalient Features contd.Tariff StructureSingle part tariff with following fixed cost components (except for biomass and non – fossil fuel based cogen plants)Return on Equity (ROE)Interest on loan capitalDepreciationInterest on working capitalOperation and maintenance expensesLevellised Tariff – Discount factor equivalent to weighted average cost of capital (WACC)Dispatch Principles –“MUST RUN” status for all RE projects except biomass project of 10 MW and non-fossil fuel based cogen plants.

15. CERC’s new regulationFinancial Principles for Tariff Determination

16. CERC’s new regulationFinancial Principles for Tariff Determination# - Varying for different states

17. CERC’s new regulationLevellised Tariff State-wise Comparison# - Wind zone not present in the state

18. Wind EnergyProject IRRs w/o depreciation benefit – comparisonCapex @ Rs. 6.0 Crs / MW

19. Wind EnergyEquity IRRs w/o depreciation benefit – comparisonCapex @ Rs. 6.0 Crs / MW

20. Solar EnergyLevellised Tariff State-wise Comparison* - Projects are under GBI policy with cap of 50 MW

21. ObjectivesNational Solar MissionTo make India Global leader in solar energy through -20,000 MW Generation Capacity by 2020100,000 MW Generation Capacity by 2030200,000 MW Generation Capacity by 2050Cost reduction for solar power to grid parity (Rs 4-5 / kWh) by 2020 To achieve parity with coal based Thermal Power by 2030Mandatory setting of solar plants equivalent to 5% of thermal power plant capacity to be set by the generation utilities.4 – 5 GW of solar manufacturing capacity by 2017

22. NATIONAL SOLAR MISSIONmission – 20 gw by 2020Phase 1 (2009 – 12)Consolidating ongoing efforts on off grid applications

23. Demo utility scale projects (CSP – Solar Thermal)

24. To achieve 1 – 1.5 GW during this phasePhase 2 (2012 – 17)Scaling up across applications & Rapid cost reduction

25. Deployment of new technologies – Concentrating PV, storage technologies