Tamil Nadu Sets ₹2.86/kWh as the New Levelized Generic Tariff for Wind Projects

The Tamil Nadu Electricity Regulatory Commission (TNERC) has issued a new levelized generic tariff for the procurement of wind-based power in the state for the financial year (FY) 2018-19.

The tariff for wind power has been fixed at ₹2.86 (~$0.0438)/kWh without accelerated depreciation (AD) and ₹2.80 (~$0.0429)/kWh with AD. The AD component of the tariff is ₹0.06 (~$0.00092)/kWh.

In this order, TNERC has ascertained 25 years as the useful life of a wind project. TNERC has also fixed ₹50.25 million (~$537,857)/MW as the project cost and capacity utilization factor (CUF) at 29.15 percent for the calculation of the levelized tariff.

For this tariff order, the TNERC fixed operation and maintenance (O&M) expenses at 1.1 percent on 85 percent of the capital investment and 0.22 percent on 15 percent of the capital investment with an escalation of 5 percent from the second year.

A discount factor of 8.75 percent and a normative debt equity ratio (70:30) has been adopted for the levelized tariff computation.

The TNERC has retained the duration for payment by the distribution licensee as 60 days, the same as the previous order and has adopted the rate of interest of 1 percent per month for any delayed payment by the distribution licensee beyond 60 days.

Recently, Mercom reported that TNERC proposed a benchmark tariff of ₹3.11 (~$0.047)/kWh without accelerated depreciation (AD) for solar power and ₹2.86 (~$0.043)/kWh without AD for wind power.

Tamil Nadu is already one of the top solar states in India with over 1.7 GW of installed solar capacity, according to Mercom’s India Solar Project Tracker.

The Tamil Nadu Generation and Distribution Corporation (TANGEDCO) also recently, revealed its plans to tender 3 GW of renewable energy capacity. The capacity will consist of 1.5 GW of solar projects and 1.5 GW of wind power projects.