The Central Electricity Regulatory Commission (CERC) has proposed setting up the national average power purchase cost (APPC) at ₹3.60 (~$0.051)/kWh for open access for FY 2019-20.

The proposal is up for comments up to May 28, 2019.

The proposed APPC at the national level has been determined by computing the average of APPC of all states and union territories, weighted by volume of conventional power purchased by the respective state or union territory.

The total cost of power purchase considered for the computation of APPC excludes the cost of generation or procurement from renewable energy sources and transmission charges. The exclusion of cost of generation or procurement from renewable sources is in alignment with the objective of determining APPC, which is to determine the average cost of power from conventional sources of electricity.

With an intent to consider the energy costs only, the CERC has excluded transmission charges from these calculations. In case of multiple utilities operating in a state, the average of the power purchase cost weighted by the power of respective utilities was computed to derive the APPC for the entire state.

According to the CERC, in FY 2018-19, 1,092,930.28 million units (MU) of power was procured from non-renewable energy generating sources by all states and union territories combined, with the average cost of non-renewable energy being ₹3.60 (~$0.051)/kWh. Therefore, this is the proposed cost.

The APPC will be applicable during FY 2019-20 and until further orders for the purpose of deviation settlement in respect of the open access and captive wind and solar generators.

In June 2018, the CERC had set ₹3.53 (~$0.050)/kWh as the APPC for open access. This APPC was applicable during FY 2018-19 and will apply until the new APPC is determined by CERC for FY 2019-20. This APPC was ₹0.05 (~$0.00073)/kWh more than the previous APPC of ₹3.48 (~$0.0511)/kWh for FY 2017-18.