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CERC order to lead to higher tariff for RPower’s Sasan power project

sasanCentral Electricity Regulatory Commission (CERC) has approved change in law that will increase its realization as part of an operations petition filed by Sasan Power Limited, Reliance Power said.

There will be an effective tariff increase of 9 paise per unit, or 7%, the company said.

A one-time compensation of Rs 271 Crore was also granted by regulatory commission till 31 July 2015, the company said.

“The order allows it to claim increase in electricity duty rate and energy development cess on sale of power to the State of Madhya Pradesh and on auxiliary power consumption, it said.

“CERC’s order clearly establishes the principles of Change in Law in line with the terms of the Power Purchase Agreement between Sasan Power Limited and Procurers, which will also ease pass-through of future Change in Law impacts on Sasan UMPP.”

Mechanism for future payments towards change in Electricity Duty Rate and Energy Development Cess has also been approved by the regulatory commission in its order, which provides compensation of over Rs 300 Crore per annum, at full capacity, over 25 years PPA term resulting in effective tariff increase of about 9 paise per unit (7% increase).

The Sasan Ultra Mega Power Project, implemented in Singrauli District of Madhya Pradesh, is the only 4,000 MW plant operating at over 100% PLF in India.

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