The Haryana Electricity Regulatory Commission (HERC) has released a discussion paper on HERC (Terms and Conditions for Determination of Tariff from Renewable Energy Sources, Renewable Purchase Obligation (RPO) and Renewable Energy Certificate (REC)) Regulations, 2017. The agency will finalize the HERC Renewable Energy Regulations 2017, after reviewing comments and suggestions from the public and stakeholders.
These regulations will come into force on the date of their publication in the Haryana Government Gazette after which they will extend to all the renewable energy project developers and obligated entities in Haryana. The HERC has stated, “The control period or review period under these regulations will be for three years from the date of notification of these regulations up to March 31, 2020.”
In the draft, the HERC has determined 25 years as the useful life of wind energy project, 20 years for biomass power and non-fossil fuel cogeneration project, 35 years for small hydro project, 25 years for solar projects, 20 years for municipal solid waste-based projects, and 20 years for biomass gasifier and biogas projects.
The HERC will determine project-specific tariffs for small and micro hydro power projects of 25 MW and below, wind projects, renewable energy projects which have been commissioned before the notification of these regulations but without signed power purchase agreements (PPAs), and for solar projects if a developer opts for a project-specific tariff.
The HERC has proposed that all renewable energy power projects, except for biomass, with an installed capacity of 10 MW and above, and non-fossil fuel based cogeneration projects, will be assigned a “must-run” status and will not be subjected to merit-order dispatch protocols.
The HERC has established a debt equity ratio of 70:30 to determine a generic tariff. For a project-specific tariff, the commission has proposed, if equity deployed is more than 30 percent of the capital cost, it will be treated as a normal loan. For tariff determination, a loan tenure of 13 years will be considered.
The HERC proposed that the state transmission utility or the transmission/distribution licensee will bear the cost of setting up extra high voltage (EHV) or high voltage (HV) transmission lines up to 10 km from the inter-connection point. If the distance between the inter-connection point and point of grid connectivity is more than 10 km, the cost of laying the transmission line for the extra distance will be borne equally between the project developer and the utility. However, for canal-based solar power projects, the transmission lines will be provided by the utilities, free of cost, irrespective of the distance of the project from the substation.
The HERC also proposed revising the solar and non-solar RPO.
To curb curtailment of power from renewable energy sources, the HERC has proposed that current signed PPAs will be honored through the useful project life, even if the total purchase exceeds the RPO at any given time.