Odisha Sets Generic Tariffs for Small Hydro, Biomass Power Projects till FY26

During the first year of the control period, the price of biomass fuel will be ₹4,118/ MT

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Odisha Electricity Regulatory Commission (OERC) has determined the generic tariff and prices for renewable energy projects, including small hydro, biomass, and non-fossil fuel-based co-generation power projects.

The control period of the tariff will span three financial years, starting from the beginning of the financial year (FY) 2023-24 and ending at the conclusion of FY 2025-26 for all renewable power projects.

For small hydroelectric projects, the control period extends from the beginning of FY 2023-24 to the end of FY 2027-28. The tariff determined based on specified principles applies to renewable energy projects commissioned during the control period and remains unchanged throughout the project’s useful life.

The preferred method for selecting renewable energy projects during the control period will be through a transparent, competitive bidding process. However, in cases where projects are developed under the bidding route or memorandum of understanding route, the generic tariff specified in this order serves as the ceiling rate or upper limit.

GRIDCO or power distribution companies will have the flexibility to negotiate a lower tariff with the project developer through bilateral agreements.

The tariff period will align with the useful life of the projects and start from the date of their commercial operation. Competitive bidding for renewable energy procurement is also applicable for the entire tariff period.

The tariffs will be applicable from fiscal year (FY) 2023-24 to FY 2025-26.

Small hydro projects

The capital cost considered for small hydro projects during the control period (FY 2023- 24 to 2027-28) will be ₹78 million (~$936,136)/MW for all projects below 5 MW and ₹90 million (~$1.08 million)/MW for projects between 5 MW to 25 MW.

The capital cost specified for the first year of the control period will remain valid for the control period unless reviewed by the Commission.

A normative Capacity Utilization Factor (CUF) of 30% is considered to determine the tariff.

The Operation and Maintenance (O&M) expenses for the first year of the control period will be ₹3.77 million (~$45,246)/ MW for projects below 5 MW and ₹2.73 million (~$32,764)/ MW for projects between 5 MW and 25 MW. The O&M expenses for subsequent years will be escalated at 3.84% per annum.

The levelized tariff for small hydro projects below 5 MW will be ₹5.93 (~$0.071)/ kWh for 40 years. The tariff for projects between 5 MW and 25 MW is ₹5.82 (~$0.070)/ kWh.

Biomass projects

The capital cost for biomass projects based on rankine cycle technology will be ₹55.9 million (~$670,881)/MW with a water-cooled condenser and ₹60 million  (~$720,087)/MW with air cooled condenser for FY 2023-24.

The Plant Load Factor (PLF) for determining the generic tariff is 80%.

The auxiliary power consumption will be 10% for water-cooled condensers and 12% for air-cooled condensers.

The O&M expenses for the first year of the control period will be ₹4.82 million (~$57,847)/MW. The O&M expenses for subsequent years will be escalated at 3.84% per annum.

During the first year of the control period, the price of biomass fuel will be ₹4,118 (~$49.42)/ MT, which would be escalated at 5% every year.

Using fossil fuels would not be allowed for biomass-based power projects commissioned during the control period.

Non-fossil fuel-based co-generation projects

The normative capital cost for the non-fossil fuel-based co-generation projects will be ₹49.2 million (~$590,471)/MW for the first year of the control period.

The PLF for determining the generic tariff is 53%.

The auxiliary power consumption is set at 8.5% of the gross energy generation.

The O&M expenses for the first year of the control period will be ₹2.55 million (~$30,603)/MW. The O&M expenses for subsequent years will be escalated at 3.84% per annum.

Bagasse fuel will be ₹2,632 (~$31.6)/MT during the first year of the control period and will be escalated at 5% annually.

The normative CUF for the wind project in Odisha will be 22%. The normative CUF has been estimated considering the annual mean wind power density as 220 watts per sq.m.

Earlier this year, OERC approved the power purchase agreement executed between Grid Corporation of Odisha and ACME Odisha Solar Power to procure power from a 25 MW solar project at a tariff of ₹7.25 (~$0.089)/kWh.

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