KERC Proposes Generic Tariff for Wind Projects at Rs 2.95/KWh

After finalizing the proposal and getting approvals, this will become the ceiling tariff for wind tenders in the state of Karnataka during the FY.

Bringing uniformity to the wind power space in Karnataka, The Karnataka Electricity Regulatory Commission has proposed the generic tariff for the year 2019-20 at Rs 2.95 per kilowatt hour.

After finalizing the proposal and getting approvals, this will become the ceiling tariff for wind tenders in the state of Karnataka during the financial year.

The tariff when finalized will be applicable from April 1, 2019 till March 31, 2020, and will also apply n the case where payment towards banked energy is concerned.

The regulatory body has also prescribed a debt-equity ratio of 70:30 for tariff determination. KERC has also proposed an interest rate of 11% on working capital and 10% on term loans.

While proposing loan tenure for 15 years, KERC has also proposed a 14 percent return on equity for wind projects.

The rate at which projects will depreciate has been proposed to be 4.67% of the capital cost for the first 15 year, to facilitate the recovery of debt.

While determining the generic tariff for wind power projects, KERC took into consideration the fact that the operation and maintenance of these projects has come down. This is why the proposed generic tariff is Rs 0.50 less than the current generic tariff in place which is Rs 3.45 for the year 2018-19.