17_Order_dt_10_04_2006_CN_01 of 200500007

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					ORDER ON TARIFF DETERMINATION FOR BHEP II

              determining tariffs. Moreover, in this case, only one bidder had participated in
              the bidding process, hence the outcome cannot be considered to have been
              tested for competitiveness.

       (b)    Further, as submitted by GOMID, the project, at present, is indeed capable of
              generating less than 25 MW, though in future, it is expected to generate higher
              capacity with the increase of the height of the Nilwande dam and the capital
              expenditure for the same is to be incurred by the irrigation department.

       (c)    A hydropower project is a combination of civil structures such as storage
              reservoir where applicable, water conductor system, adequate facility for
              discharge of tailrace water and electro mechanical equipments. The actual
              installed capacity of the plant will be limited by the inadequacy of any of these
              components irrespective of the rated capacity of the electro mechanical
              equipments. It will therefore not be correct to consider only the machine rating
              as the installed capacity.

       (d)    The projected power output, provided by GOMID, in the current phase is
              18.78 MWs. In the GoM ‘State Hydel Policy for Development Of Small
              Hydro Power Projects through Private Sector Participation’ the Government
              has stated that the policy is applicable to hydropower projects up to 25 MW
              installed capacity. As submitted by GOMID, the power output from the
              project will increase beyond 25 MW only after the height of Nilwande Dam
              reaches 613 meters. Also in the Order for Determination of Tariff for SHP
              Projects within Maharashtra dated 9th November, 2005 of the Commission the
              approved tariff has been made applicable for projects upto an installed
              capacity of 25 MWs.

4.22   Considering the above the Commission finds merit in treating the project as similar to
       a Small Hydro Power project till the height of Nilwande dam is raised till 610/613
       meters.

4.23   Therefore till the Nilwande dam height is raised till 610/613 meters, the Commission
       approves the SHP tariff (as provided in order on Determination of Tariff for SHP
       Projects within Maharashtra dated 9th November, 2005) for this project from the date
       of approval of this order. The tariff applicable on the date of approval of this order
       shall be as per the first year of the SHP tariff.

4.24   The above Tariff shall be applicable for BHEP-II during phase-I of the project (i.e.
       until height of Nilwande dam reaches 610 M). Further, the developer can approach
       the Commission for revision of tariff once the dam height is raised till 610 m / 613m.

Commission Determined Tariff Rates for BHEP II
4.25   Based on the Order on Determination of Tariff for SHP Projects within Maharashtra
       dated 9th November, 2005, Commission has adopted the SHP tariffs for BHEP II. The
       SHP tariff as approved by the Commission in Determination of Tariff for SHP
       Projects within Maharashtra dated 9th November, 2005 is provided in Annexure H.




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ORDER ON TARIFF DETERMINATION FOR BHEP II


Applicability of the Order
4.26   The Order shall be applicable for supply of electricity from Bhandardara Hydro
       Electric Project II to the Distribution Licensees in the State of Maharashtra till the
       Nilwande dam height is raised till 610/613 meters.



       With this Order, the Commission disposes the Petition.




 Sd/-                                Sd/-                           Sd/-
(S. B. Kulkarni)                    (A. Velayutham)                (Dr. Pramod Deo)
Member, MERC                        Member, MERC                   Chairman, MERC




                                                                  (Malini Shankar)
                                                                  Secretary, MERC




                                                                                   Page 26 of 45
ORDER ON TARIFF DETERMINATION FOR BHEP II


A5: APPENDIX – A
Reserve price Calculation for BHEP Stage II
Alternative I

Assumption: Reserve price = Actual construction cost – depreciation + establishment charges

Year of Commissioning = May 1999

Expenditure on the project works upto March 2003             =       8457.750 Lakhs

Less Depreciation @ 3.4 %/ year for 4 years                  =       1150.254 Lakhs

Depreciated Value of Works                                   =       7307.496 Lakhs

Add Establishment Charges (Actual)                           =       1580.350 Lakhs

Reserve Price                                                =       8887.846 Lakhs

                                              Say Rs         =       89.000 Crores

Alternative II

Assumption: First Revised Administratively Approved Cost of project is indexed

The revised estimated cost based on price level of 85-86 = Rs 3336.72 Lakhs

Index for 85-86                                               =      133

Index for 2002-03                                            =       447

Indexed Cost =          3336.72 x 447/133                    =       11214.390 Lakhs

Less Depreciation @ 3.4% / year for 4 years                  =       1525.157 Lakhs

Reserve Price                                                =       9689.233 Lakhs

                                              Say Rs         =       97 Crores

Reserve Price

Alternative I                 =               89 Crore

Alternative II                =               97 Crore

Based on the alternatives reserve price is finalised as Rs 92.00 Crores




                                                                                      Page 27 of 45
ORDER ON TARIFF DETERMINATION FOR BHEP II


A6: APPENDIX – B
Price Schedule for BHEP II Bid
                           APPENDIX 1

                           PRICE SCHEDULE
             Amount Due           Amount Due (Rs              Amount Due (Rs
   Year                    Year                        Year
              (Rs Lakhs)             Lakhs)                      Lakhs)
    On
                 60         11          100            21          1720
 Agreement
    2            0          12          300            22          2000
    3            50         13          300            23          2000
    4            50         14          300            24          2000
    5            75         15          300            25          2000
    6            75         16          300            26          2000
    7            100        17          1200           27          2000
    8            100        18          1700           28          2000
    9            100        19          1700           29          2000
    10           100        20          1700           30           0
                                 Total (Rs in Lakhs)              32270




                                                                          Page 28 of 45

				
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