Transcript OHPC - Orissa Electricity Regulatory Commission

Analysis of ARR & Tariff Proposal
2011-12
of
OHPC
World Institute of Sustainable Energy
Consumer Counsel
Presentation Outline




ARR & Tariff Proposed by OHPC
Comparison of ARR parameter & Tariff with
previous year approved ARR (2010-11)
Observations and suggestion on the current
ARR & Tariff filings (2011-12)
Conclusion
Installed Capacity of OHPC Stations
Sl.
No.
Name of the
Power Stations
Installed
Capacity
(2010-11)
MW
Installed
Capacity
(2011-12)
MW
1
Hirakud (HHEP)
275.50
275.50
2
Chiplima(CHEP )
72.00
72.00
3
Balimela (BHEP )
510.00
510.00
4
Rengali ( RHEP)
250.00
250.00
5
Upper Kolab (UKHEP )
320.00
320.00
6
Upper Indravati(UIHEP )
600.00
600.00
7
Machhkund ( Orissa share)
34.50
34.50
Total
2062
2062
Design Energy of OHPC Stations
Sl.
No.
Name of the
Power Stations
Design Energy
(DE)
(in MU)
Design Energy
for sale
(MU)
1
HHEP
684.00
677.16
2
CHEP
490.00
485.10
3
BHEP
1183.00
1171.17
4
RHEP
525.00
519.75
5
UKHEP
832.00
823.68
6
UIHEP
1962.00
1942.38
5676.00
5619.24
Total
Proposed Project Cost in ARR 2011-12
Sl.
No
Power
Station
s
Historical
cost of
assets as
on
01.04.96
Revalued
Cost of
assets as
on
01.04.96
New
additions
up to 201011
Project cost
for 2010-11
(based on
original
cost)
1
HHEP
72.75
130.16
191.74
264.49
321.90
2
CHEP
92.23
165.01
42.82
135.05
207.83
3
BHEP
115.42
334.66
209.62
325.04
544.28
4
RHEP
91.09
259.01
3.61
94.70
262.62
5
UKHEP
108.31
307.96
3.82
112.13
311.78
Total
Old PS
479.80
1196.80
451.61
931.41
1648.41
1195.42
1195.42
6
UIHEP
Approved project cost
Project cost
for 2010-11
(based on
revalued
cost)
Proposed ARR & Tariff for 2011-12
Components of ARR /
Tariff
RHEP
UKHEP
BHEP
HHEP
CHEP
UIHEP
Total
Salable Design energy
(MU)
519.75
823.68
1171.17
677.16
485.10
1942.38
5619.24
Interest on Loan
0.11
0.13
8.56
2.98
1.46
38.21
51.45
Depreciation
2.43
2.88
16.17
6.86
3.47
30.23
62.04
Return on equity
0.21
0.22
12.17
9.28
2.49
57.82
82.19
O&M Expenses
38.10
28.07
46.80
40.78
16.55
61.97
232.27
Interest on working
capital
2.00
1.50
3.17
2.49
1.00
5.85
16.02
Total ARR ( Crs)
42.85
32.80
86.87
62.39
24.97
194.08
443.97
Average Tariff
(P/U)
82.451
39.824
74.178
92.134
51.480
99.919
79.010
Proposed capacity charge and energy charge
Sl.
No.
Name of the
Power Stations
Capacity
charge
(Rs crore)
Energy
Charge
(P/U)
1
HHEP
31.195
46.067
2
CHEP
12.485
25.74
3
BHEP
43.435
37.089
4
RHEP
21.425
41.225
5
UKHEP
16.40
19.912
6
UIHEP
97.04
49.958
Comparison of ARR parameters and Tariff with
Previous year ARR
Comparison of components of ARR
(Rs in Cr)
Component
of ARR
HHEP
CHEP
BHEP
RHEP
UKHEP
UIHEP
201011 (A)
201112 (P)
201011 (A)
201112 (P)
201011(A)
201112 (P)
201011 (A)
201112 (P)
201011 (A)
201112 (P)
201011(A)
201112 (P)
Return of
Equity
8.87
9.28
1.68
2.49
4.13
12.17
0.16
0.21
0.21
0.22
55.78
57.82
Interest on
loan
3.64
2.98
1.00
1.46
1.3
8.56
0.21
0.11
0.25
0.13
0
38.21
Depreciatio
n
7.97
6.86
3.3
3.47
16.12
16.17
2.41
2.43
2.88
2.88
30.23
30.23
O&M
37.92
40.78
15.93
16.55
44.3
46.8
31.56
38.1
22.82
28.07
56.39
61.97
Interest on
WC
2.23
2.49
0.88
1
2.55
3.17
1.57
2
1.16
1.5
4.42
5.85
32.8
146.8
2
194.0
8
Total ARR
60.64
% Increase
62.39
2.88
%
22.79
24.97
9.56
%
68.4
86.87
27%
35.91
42.85
19%
27.32
20%
32%
Percentage increase in Tariff over 2010-11
Name
of the
Sl. Power
No. Stations
1
HHEP
2
CHEP
3
BHEP
4
Average
Average
cost in
cost in
2009-10
20010-11
(P/U)
(P/U))
(approved) (approved)
Proposed
Average
cost (P/U)
FY 2011-12
(proposed)
(Increase in P/
U) Percentage
increase over
2010-11
89.54
92.134
(2.59) 2.90%
46.98
51.48
(4.5) 9.58%
56.66
58.41
74.178
(15.17) 27%
RHEP
58.22
69.09
82.45
(13.36)19.34%
5
UKHEP
25.19
33.17
39.42
(6.25)18.84%
5
UIHEP
73.35
75.59
99.919
(24.32)32.19%
64.96
Percentage increase in Tariff over 2010-11
During FY 2011-12, OHPC propose to supply an
estimated energy of 5619.24 MU at an average rate
of 79.01 P/kWh
During FY 2010-11 , same unit supply was approved
by Commission at an average rate of 64.40 P/kWh
Over all Hike of 22.68% in OHPC tariff
Comparison of two-part tariff
Sl.
No
Name of the
Power
Stations
1
Approved tariff
2010-11
Proposed tariff 2011-12
Capacity
charge
(Rs crore)
Energy
Charge
(P/U)
Capacity
charge
(Rs crore)
Energy
Charge
(P/U)
HHEP
30.320
40.775
31.195
46.067
2
CHEP
11.395
23.490
12.485
25.74
3
BHEP
34.20
29.201
43.435
37.089
4
RHEP
17.955
34.545
21.425
41.225
5
UKHEP
13.660
16.584
16.40
19.912
6
UIHEP
73.410
37.793
97.04
49.958
Observations and suggestion on the ARR & Tariff
parameters (2011-12)
Two Part Tariff – CERC Regulation 09


Annual Fixed cost for Hydro station is to be recover
through
Capacity Charge (50%)
Energy Charge (50%)
Annual Fixed Cost consist of
Return of Equity
Interest on loan capital
Depreciation
O&M
Interest on working capital
Capitalization of asset during 2010-11
Sl.
No.
Name of
the
Power
Stations
Historical
cost of
Asset as on
01.04.96
( Cr)
New
additions up
to 2009-10
( Cr)
(approved)
Proposed
new
additions
up to
2010-11
Additional
Capitalization
during 201011
(Cr)
1
HHEP
72.75
190.09
191.94
1.85
2
CHEP
92.23
36.02
42.82
6.8
3
BHEP
115.42
208.74
209.62
0.88
4
RHEP
91.09
2.83
3.61
0.78
5
UKHEP
108.31
3.81
3.82
0.01
6
UIHEP
Approved Project cost – 1195.42
10.32
Capitalization of asset during 2010-11
Observations & submission




The expenditure of 10.32 Cr on account of capitalization of
assets during 2010-11 is not approved by the Commission in
2010-11 ARR
The expenditure details and the status of the work for the
proposed asset capitalization is missing in the ARR.
Expenditure details of TRCM installation at Chiplima HEP
(6.80 Cr against order value of 6.06 Cr) may required to be
furnished
Hon. Commission may consider the expenses on account of
capitalization of asset to pass through in the ARR after
verifying the cost and necessity of the work
Interest on Loan
Observation & Suggestion




The loan liability of OHPC consist of state Govt loan and PFC
loan
OERC has advised the Govt that the effects of up-valuation of
assets and moratorium on debt services of state Govt loan shall
be kept in abeyance till end 2012-13
Interest of Rs 38.21 Cr on State Government investment /loan
(545.86 cr) in UIHEP may be kept in abeyance till end of the
control period Or OERC may recommend Govt to make it
interest fee loan
This will substantially reduce UIHEP tariff as well as the average
cost of supply of OHPC stations (6.8 P/U); since UIHEP
contribute app 35% share of design energy of OHPC stations
O& M expenses
Observation
OHPC has claimed O& M expenses as per CERC 2009 regulation (5.72
% escalation on previous yr O&M) and thereafter added various
Arrear salary and terminal liabilities
Submission
 Arrear salary and terminal liabilities of Corporate Office claimed in the
ARR 2011-12 ( 6.95 Cr) – It is not clear whether it is paid in 2010-11 or
proposed to be paid in 2011-12 . If not paid in 2010-11 same shall not
be considered in ARR 2011-12.
 Differential Pension liability (21.28 Cr) should be met through
Terminal (Pension) liabilities fund (140.95 Cr) earmarked for the
purpose by OHPC & shall not allow to pass through in the ARR –
Reply to the query raised by Director Tariff in OHPC ARR order of
2010-11

Interest on Working capital
Submission
 CERC Tariff Regulation 2009 specifies the interest of W.C as
SPLR of SBI as on 01.04.09 or 1st April of the year in which
the generating station is declared under commercial
operation, which ever is later.
 As all 6 HEP of OHPC has put on commercial operation
prior to 01.04.2009 the SBI SPLR prevailing as on
01.04.2009 may be consider for calculating interest on
working capital.
 Since there is provision of Rs 14 Cr for Rolling Working
Capital earmarked by OHPC during 2009-10, total working
capital requirement for FY 2011-12 (128.19 Cr ) may be
reduced by appropriate amount .
In Conclusion


Hon Commission may consider the suggestions of
consumer counsel with regard to interest on loan
(particularly of UIHEP), O&M, interest on
working capital and curtail the ARR accordingly
in the interest of consumers.
As per Govt notification OHPC is claiming license
fee for water used for generation of electricity
from all HEP (5.67 Cr) . Since it is nonconsumptive use of water and OHPC is Govt
Corporation OERC may advice Govt to waive the
license fees
Thank You