Options for Renewable/ Captive/ IPPs etc. EXTRACTS FROM ELECTRICITY ACT 2003 Para 3(1) NATIONAL ELECTRICITY POLICY AND PLAN: The Central Government shall, from time to time, prepare the national electricity policy and tariff policy, in consultation with the State Governments and the Authority for development of the power system based on optimal utilisation of resources such as coal, natural gas, nuclear substances or materials, hydro and renewable sources of energy.

EXTRACTS FROM TARIFF POLICY Para 6.3 Harnessing Captive Generation Captive generation is an important means to making competitive power available. Appropriate Commission should create an enabling environment that encourages captive power plants to be connected to the grid. Such captive plants could inject surplus power into the grid subject to the same regulation as applicable to generating companies. The prices should be differentiated for peak and off-peak supply and the tariff should include variable cost of generation at actual levels and reasonable compensation for capacity charges. Alternatively, a frequency based real time mechanism can be used and the captive generators can be allowed to inject into the grid under the ABT mechanism. Options for Renewable/ Captive/ IPPs etc.

EXTRACTS FROM TARIFF POLICY Para 6.4 : Non-conventional sources of energy generation Pursuant to provisions of Section 86(1)(e) of the Act, the Appropriate Commission shall fix a minimum percentage for purchase of energy from such sources taking in to account availability of such resources in the region and its impact on retail tariffs. Para 6.4 contd… It will take some time before non-conventional technologies can compete with conventional sources in terms of cost of electricity. Therefore, procurement by distribution companies shall be done at preferential tariffs determined by the appropriate commission. Options for Renewable/ Captive/ IPPs etc.

Non Conventional Energy Sources POSSIBLE OPTIONS FOR SALE OF ENERGY: - Short Term Open Access - Unscheduled Interchange(UI) - Through Tariff determined by Regulator

ISSUES OF IMPORTANCE IN CASE OF NON- CONVENTIONAL (Renewable) ENERGY SOURCES - FAVOURED ACCESS / WHEELING CHARGES - POSSIBILITY OF BANKING - EXEMPTION FROM MERIT ORDER - MUST RUN STATUS - ENABLING TARIFF BY STATE COMMISSIONS POSSIBLY SIMILAR TREATMENT IS TO BE MOOTED TO SUCH OTHER RENEWABLE SOURCES VIZ. MINI / MICRO HYDEL ETC. ESC TO EXIT

SALE OF NON CONVENTIONAL ENERGY THROUGH STOA: - CAN NOT BE DISPATCHED/ REGULATED ON A REAL TIME BASIS; - AVAILABLE ON SEASONAL BASIS; - TO BE TAPPED WHENEVER AVAILABLE - APPLICATION OF ACCESS CHARGES (Access Charges could very from %) HENCE POSSIBILITY OF SELLING N.C. ENERGY THROUGH STOA IS NOT VERY ENCOURAGING.

SALE OF WIND ENERGY THROUGH UI - CANNOT REGULATE THE GENERATION DEPENDING ON FREQUENCY AVG. UI RATE COMES IN THE RANGE OF AROUND Rs – 3.00 Per unit HENCE POSSIBILITY OF SELLING THROUGH UI MAY NOT BE ENCOURAGING ALL THE TIME DETAILS

YEARAVG.UNIT RATE(RS.) EXTRACTS FROM APERC ORDERS IN THE MATTER OF DETERMINATION OF TARIFF IN RESPECT OF RENEWABLE SOURCES OF ENERGY.

EXTRACTS FROM KERC ORDER DATED 18 TH JAN 2005 IN THE MATTER OF DETERMINATION OF TARIFF IN RESPECT OF RENEWABLE SOURCES OF ENERGY. TYPEUNIT RATE(RS.) MINI HYDEL PROJECTS (10 YEAR PERIOD)2.80 WIND PROJECTS (10 YEAR PERIOD)3.40 CO-GENERATION PROJECTS (1 ST YEAR AND 2% PER ANNUM ESCALATION FOR NEXT 9 YEARS) 2.80 BIO MASS PROJECTS (1 ST YEAR AND 2% PER ANNUM ESCALATION FOR NEXT 9 YEARS) 2.85

GENERATOR STU DISCOM 2 CONSUMER DISCOM 1 ACCESS CHARGES UNDER STOA CASE 1 WHEN BOTH GENERATOR AND CONSUMER ARE EMBEDDED CUSTOMER OF DISCOMS

GENERATOR STU DISCOM 2 CONSUMER ACCESS CHARGES UNDER STOA CASE 2 WHEN ONLY CONSUMER IS EMBEDDED CUSTOMER OF DISCOM

GENERATOR STU CONSUMER ACCESS CHARGES UNDER STOA CASE 3 WHEN BOTH GENERATOR AND CONSUMER ARE DIRECTY CONNECTED TO STU

CAPACITY BREAKUP OF WIND INSTALLATIONS Tamil Nadu –2036 MW Karnataka – MW Andhra MW Gujarat – Rajasthan Maharashtra – MW M.P MW Kerala –2 MW W.Bengal – 1.1. MW

EXTRACS FROM ELECTRICITY ACT 2003 Section 86(1)(e) State Commission shall promote congenration & generation of electricity from renewable sources of energy by providing suitable measures for connectivity with the grid and sale of electricity to any person, and also specify, for purchase of electricity from such sources, a percentage of the total consumption of electricity in the area of a distribution licence. Renewable Sources of Energy