CERC Issues Generic Tariffs for Select Renewables in FY 2018-19

The CERC order sets the useful life of many technologies at 20 years, but gives small hydro projects a useful life of 35 years


The Central Electricity Regulatory Commission (CERC) has issued a set of levelized generic tariffs for the purchase of electricity from a host of renewable power generation sources during financial year (FY) 2018-19.

The levelized generic tariffs will apply to small hydro projects, biomass with Rankine cycle projects, non-fossil fuel-based co-generation projects, biomass gasifiers, and biogas-based projects.

Excluded from the levelized generic tariff list are “solar photovoltaic, solar thermal, wind (onshore and offshore), municipal solid waste (MSW)/refuse-derived fuel (RDF), and other emerging renewable energy technologies,” the CERC order stated. For these types of generation, CERC said the tariff will be specific to each project, and not generic.

In determining the levelized generic tariff structure, CERC used a formula that took into account the expected useful life of each project. In its order, CERC considered the useful life of small hydro projects to be 35 years, whereas the useful life for biomass with Rankine cycle, non-fossil fuel-based co-generation, biomass gasifiers, and biogas-based projects was set at 20 years each.

CERC Issues Generic Tariffs for Select Renewables in FY 2018-19

The tariffs set by CERC will apply during FY 2018-19. After that, CERC may or may not review them and propose changes.

Levelized tariffs are calculated by CERC using a system that determines the useful life of each technology and takes into account the post-tax weighted average cost of capital as a discount factor.

As of December 31, 2017, Bio-Power which includes various types of biomass and biogas made up 2.5 percent of renewable energy installations in India, small hydro accounted for 1.32 percent.

To tackle air pollution issues the Ministry of Power released an order last month calling for 5-10 percent usage of biomass pellets alongside coal power generation across the country. In 2017, electricity generated by biomass fell by 11 percent year-over-year.

Mercom previously reported on the fixed generic tariff proposed by CERC for select renewables for FY 2017-18.

Image credit: Tomasz Sienicki (Own work), CC BY 3.0 via Wikimedia Commons