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<p>The Tamil Nadu Electricity Regulatory Commission (TNERC) has proposed a new benchmark solar tariff of Rs.4.50 ($0.0673)/kWh with accelerated depreciation and a tariff of Rs.4.41 (~$0.0659)/kWh without accelerated depreciation for FY 2017-18. The commission has invited comments and suggestions on its proposal on or before March 15, 2017. Once comments and suggestions are received and reviewed, the new tariff order will be come into force from April 1, 2017.</p>
<p>The new tariff order includes a single-part tariff which consists of fixed cost and variable energy cost for solar energy generation.</p>
<p>The suggested capacity utilization factor (CUF) is 19 percent and the project costs for solar PV projects have been fixed at Rs.0.47 million (~$703,014)/MW. The commission has also proposed decreasing the rate of interest on working capital from the previous 13.5 percent to 11.5 percent.</p>
<p>The new proposed tariff is 12% lower than the <a href="http://www.tnerc.gov.in/orders/Tariff%20Order%202009/2016/Solar%202016/Solar%20Order%20-%202%20of%202016.pdf" target="_blank" rel="noopener noreferrer">previous tariff</a> of Rs.5.10 (~$0.07628)/kWh (with accelerated depreciation) and Rs.4.56 (~$0.06821)/kWh without. TANGEDCO had already made this adjustment in tariff last October when it floated a <a href="https://mercomindia.com/tangedco-tenders-another-500-mw-solar-fulfill-rpo/" target="_blank" rel="noopener noreferrer">tender</a> for 500 MW of solar. Response to that tender was muted as the tariff was considered too low for a high risk off-taker like TANDECO. However, Chinese module prices have declined by approximately 30% over the last year.</p>
<p><a href="https://mercomindia.com/wp-content/uploads/2017/07/Financial_Operations_and_Parameters_of_Solar_PV_and_Solar_Thermal_Projects_Proposed_by_TNERC.png"><img decoding="async" loading="lazy" class="aligncenter size-full wp-image-5129" src="https://mercomindia.com/wp-content/uploads/2017/07/Financial_Operations_and_Parameters_of_Solar_PV_and_Solar_Thermal_Projects_Proposed_by_TNERC.png" alt="" width="720" height="371" srcset="https://cms.mercomindia.com/wp-content/uploads/2017/07/Financial_Operations_and_Parameters_of_Solar_PV_and_Solar_Thermal_Projects_Proposed_by_TNERC.png 720w, https://cms.mercomindia.com/wp-content/uploads/2017/07/Financial_Operations_and_Parameters_of_Solar_PV_and_Solar_Thermal_Projects_Proposed_by_TNERC-600x309.png 600w, https://cms.mercomindia.com/wp-content/uploads/2017/07/Financial_Operations_and_Parameters_of_Solar_PV_and_Solar_Thermal_Projects_Proposed_by_TNERC-300x155.png 300w, https://cms.mercomindia.com/wp-content/uploads/2017/07/Financial_Operations_and_Parameters_of_Solar_PV_and_Solar_Thermal_Projects_Proposed_by_TNERC-650x335.png 650w, https://cms.mercomindia.com/wp-content/uploads/2017/07/Financial_Operations_and_Parameters_of_Solar_PV_and_Solar_Thermal_Projects_Proposed_by_TNERC-624x322.png 624w" sizes="(max-width: 720px) 100vw, 720px" /></a></p>
<p><em>Image Credit: TNERC</em></p>
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<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/saumy/" class="vcard author" rel="author"><span class="fn">Saumy Prateek</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/12/saumy-edited-1.png" width="50" /></p>
<p><strong style="text-decoration: underline">Saumy Prateek</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/saumy/" target="_blank" rel="noopener">More articles from Saumy Prateek</a></p>
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<div class="authorboxn"><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/12/saumy-edited-1.png" width="79" height="102" /><a href="https://mercomindia.com/author/saumy/" rel="noopener"><strong>Saumy Prateek, </strong> </a>is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism &amp; Mass Communication from the Manipal Institute of Communication at Manipal University.<a href="https://mercomindia.com/author/saumy/">More articles from Saumy Prateek.</a></div>
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Tamil Nadu Electricity Regulatory Commission Proposes New Benchmark Solar Tariff for FY 2017-18

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