The Policy can be accessed?here.
?
The Policy can be accessed here.
Cross subsidy Charges: As a promotional measure for solar power no cross-subsidy surcharges would be levied in case of third-party sale.
It is worth noticing that GERC had calculated its tariffs back in 2012 for coming years I.e. FY 13, FY14 & FY 15, while CERC revises its tariffs every year. The difference visible between tariffs of CERC and GERC for previous years is because the GERC hasn’t revised its tariff after 2012 and it is that period during which the capital cost of the solar modules fell drastically and so the difference didn’t reflect on the tariffs of GERC as it wasn’t revised.
Now the GERC has proposed new tariff which is quite lower (approx. 5.5%) than the tariff finalized by the CERC. A public hearing on the matter will take place on 29th June 2015.
Dear Reader,
We are pleased to present Open Access Vol 43 – our monthly newsletter covering RECs and regulatory and market developments in the renewable energy space.
The main article covers:
The government announced the re-introduction of Accelerated Deprecaition for wind projects. This was a major announcement for the Renewable energy industry. Our main article provides a detailed analysis of the impact of this change, and the relative merits and de-merits of investing in wind or solar projects.
This issue also covers:
– Details of the next batch of bidding for solar projects announced in JNNSM
– Details of the FOR?meeting that took up the need for strong RPO enforcement
– Various other regulatory developments in Maharashtra, Rajasthan, Chattisgarh, Karnataka, and other states
Past newsletters can be accessed here –?http://www.reconnectenergy.
For latest news and updates, please visit our blog at –?http://www.slotln.online/blog/
?As always, we will love to hear your feedback on the newsletter.
– Team REConnect
]]>Wind Power development in India started in the early 90s. As per Section 80(J) of Income Tax Act 1961, industries were allowed 80% depreciation on capital invested. Since then till 2012 (when the benefit was removed), Wind Power development and growth has always relied primarily on Accelerated Depreciation (AD).
New wind capacity additional peaked in 2011-12 at about 3,200 MW, falling sharply to 1,700 MW the next year as AD benefits were removed. The argument put forward at that time by policy makers was that wind industry had matured, and the focus needed to shift to solar. This fits well with the objectives of the National Solar Mission.
The decline in wind investment due to withdrawal of AD coincided with healthy growth of close to 60% in Solar Power in 2012-13 and 2013-14. The market momentum had definitely shifted in favor of Solar. Our analysis suggests that Wind AD market had an investing capital of close to 7300 crores. This shifted to Solar AD market which saw increase in investments worth Rs 7500 crores during 2012-13.
The new government has announced that it was reintroducing AD (80%) in 2014, much to the delight of Wind Power stakeholders. We believe that the investment momentum will shift again to wind due to more mature policies and attractive tariffs.
Wind tariff in recent years have become very attractive?and are close to solar tariff in many states. In Rajasthan, Maharashtra and MP, tariff in the range of Rs. 5, whereas solar tariffs are generally in the range of Rs. 6, leaving a very small gap.
With this, there will certainly be a diversion in investments from Solar to Wind power in the times to come.
These can also be understood from the table and graph below.
The green dots represent the advantage to the sector.
The details of the tariff determined are as below:
A graph on the variation of wind and biomass tariffs over last three years is given below:
It is evident from the graph that the percentage increase in wind tariff is lower for FY 14-15 as compared to the increase in FY 13-14. Same in the case of Biomass tariff the percentage increase in tariff is more than 12% compared to previous year, which may be because of the increase in fuel cost and total plant operation cost.
The RERC wind tariff order can be accessed here
The RERC Biomass Tariff can be accessed here
Our previous blog post on Rajasthan Solar tariff can be read here
Contributed by Dheeraj Babariya
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