Computation of Tariff Bulk Consumer Open Access 15-Jun-2011

8/13/2019 Computation of Tariff Bulk Consumer Open Access 15-Jun-2011

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Computation of tariff under open

access for bulk customer in a state

S.C. Saxena

National Load Despatch Center


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Acknowledgement

FOR Secretariat Detailed inputs regarding Model Terms and Conditions

for Intra State Open Access

Case Studies for calculation of Open Access Charges

Power Exchanges Case Studies for calculation of Open Access Charges

System Operator Training 2


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Presentation Outline

Introduction

Model Terms and Conditions of Intra-State OpenAccess Regulations, September 2010

Case Studies

Issues in Intra State Open Access



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Introduction



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DEFINITION

Electricity Act 2003: Open Access is defined as

Open access means the non -discriminatory provision for the use of transmission lines or distribution system or

associated facilities with such lines or system by anylicensee or consumer or a person engaged in generationin accordance with the regulations specified by the

Appropriate Commission.

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EA 2003: Provisions for Grant Of Open Access

Section 38(2)(d): CTU and functions

Section 39(2)(d): STU and functions

Section 40(c): Duties of Transmission Licensees

Section 42(2): Duties of Distribution Licensees andOpen Access

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EA 2003: Provisions for Grant Of Open AccessSection 42(2) Distribution Licensee

(2)The State Commission shall introduce open access in such phases andsubject to such conditions, (including the cross subsidies, and otheroperational constraints) as may be specified within one year of theappointed date by it and in specifying the extent of open access in successive

phases and in determining the charges for wheeling , it shall have due

regard to all relevant factors including such cross subsidies , and otheroperational constraints: .

Provided also that the State commission shall, not later than five years fromthe date of commencement of the Electricity (Amendment)Act, 2003, byregulations, provide such open access to all consumers who require a supplyof electricity where the maximum power to be made available at any timeexceeds one megawatt .

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National Electricity Policy, 2005 Section 5.4.5

The Electricity Act 2003 enables competing generating companies and

trading licensees, besides the area distribution licensees, to sellelectricity to consumers when open access in distribution is introducedby the State Electricity Regulatory Commissions. As required by the Act,the SERCs shall notify regulations by June 2005 that would enableopen access to distribution networks in terms of sub-section 2 ofsection 42 which stipulates that such open access would be allowed , .Section 49 of the Act provides that such consumers who have been

allowed open access under section 42 may enter into agreement withany person for supply of electricity on such terms and conditions,

including tariff, as may be agreed upon by them.. While making regulations for open access in distribution, the SERCswill also determine wheeling charges and cross-subsidy surcharge asrequired under section 42 of the Act.



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Tariff Policy Section 8.5.1 provides

A consumer who is permitted open access willhave to make payment to the generator, thetransmission licensee whose transmission systemsare used, distribution utility for the wheelingcharges and in addition, the cross subsidysurcharge.The computation of cross subsidy surcharge,

therefore, needs to be done in a manner thatwhile it compensates the distribution licensee, itdoes not constrain introduction of competitionthrough open access .



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Tariff Policy Section 6.3: Harnessing Captive Generation

Wheeling charges and other terms and conditions forimplementation should be determined in advance by therespective State Commission, duly ensuring that the charges arereasonable and fair.

Grid connected captive plants could also supply power to non-

captive users connected to the grid through availabletransmission facilities based on negotiated tariffs. Such sale ofelectricity would be subject to relevant regulations for openaccess

Section 6.4: Non-Conventional Energy Sources, including co-generation

Section 8.5: Calculation of Cross Subsidy Surcharge and Additional Surcharge

for Open Access



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Status of Open Access Implementation (source: FOR)

11

S. No. SERC Notification ofOA Regulations

Determination ofSurcharge

Determination ofWheeling Charges

Determination ofTransmission

Charges 1 APERC Yes Yes Yes Yes

2 AERC Yes Yes Yes Yes

3 BERC Yes Yes Yes Yes

4 CSERC Yes Yes Yes Yes

5 DERC Yes Yes Yes Yes

6 GERC Yes Yes Yes Yes

7 HERC Yes No Yes Yes

8 HPERC Yes Yes Yes Yes 9 J&KSERC Yes Yes No Yes

10 JSERC Yes Yes Yes Yes

11 KERC Yes Yes Yes Yes

12 KSERC Yes Yes No Yes

13 MPERC Yes Yes NA Yes

14 MERC Yes Yes Yes Yes

15 MsERC Yes No No Yes

16 OERC Yes Yes Yes Yes

17 PSERC Yes Yes Yes Yes

18 RERC Yes Yes Yes Yes

19 TNERC Yes Yes Yes Yes

20 TERC No No No No

21 UPERC Yes Yes Yes Yes

22 UERC Yes Yes Case to case basis Yes

23 WBERC Yes Yes Yes Yes

24 JERC-M&M No No No No

25 JERC-Uts No No No No TOTAL 22 20 17 22


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Model Terms and Conditions of Intra-StateOpen Access Regulations,September 2010

Forum of Regulators



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Contents Preliminary Connectivity General Provisions for Open Access Application Procedure and Approval Open Access Charges Scheduling, Metering, Revision and Losses Imbalance and Reactive Energy Charges Commercial Matters Limited Short Term Open Access Information System Open Access to Generator Connected to Distribution

System Miscellaneous



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Definition of Open Access, OA Customer

Open access means the non discriminatory provision for the use of transmission lines ordistribution system or associated facilities withsuch lines or system by any licensee orconsumer or a generating company in

accordance with these regulations and includeslong term access, medium-term open accessand short-term open access.

"Open access customer" means a consumer,trader, distribution licensee or a generatingcompany who has been granted open accessunder these regulations.



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Regulation 11:Categories of Open Access ConsumersThe application procedure, application fee and the time frame of

processing request by eligible consumers seeking Open Accessshall be based on the following criteria

(1) System to which connected (a) Intra-State transmission system (b) Distribution system

(2) Inter-se location of drawal and injection points (a) Both within the same distribution system (b) within the State but in different distribution systems (c) In different States

(3) Duration of Open Access (a) Long term access (b) Medium-term open access (c) Short-term open access



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Categories of Open Access Consumers

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Consumer

STU DISCOM

Intra-StateInter-State

STOA MTOA LTA STOA MTOA LTA

Intra-State(within DISCOM)

Any OA

ConnectionPoint

Location ofdrawal Point

Period of OA

NodalAgency


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Eligibility for Open Access Open access shall be permissible to the customers

seeking for open access capacity upto which SERC hasintroduced open access and

connected through an independent feeder emanating froma grid substation of licensee or

industrial feeder provided that all the customers on suchindustrial feeder opt for open access and havingsimultaneous schedule of drawal under such open access.

Consumers who are not on independent feeders,shall be allowed open access subject to the condition

that they agree to rostering restrictions imposed by utilityon the feeders serving them.

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Application procedure and approval (1)

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PeriodInter-se location of

drawal andinjection point

Nodal agencyApplication

fee (Rs.)Documents to accompany the

application

Time frame for disposal ofapplication (days from the receipt ofapplication)

S h o r t - T e

r m O

p e n A c c e s s

Both within thesame Distribution

licensee

ConcernedDistribution

Licensee2000 Proof of payment of Application fee,

7 working days in case STOAapplied for first time.3 working days on subsequentSTOA applications.

Both within thesame State but inareas of different

DistributionLicensees

SLDC 5000Proof of payment of Application fee,Consent from concerned Distribution

licensees


Injection point inthe intra-Statetransmission

system within theState

SLDC 5000Consent from concerned Distribution

licensee,Proof of payment of Application fee,


In different States

RLDC of theregion where

consumer islocated

5000Consent from concerned SLDCs andDistribution licensees as applicable,Proof of payment of Application fee,

As per Central Commissions

Regulation

Consumer connected to Distribution System Regulation 12


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20/04/2011 19

Period

Inter-se location of



fee (Rs.) Documents to accompany the application

Time frame fordisposal of application(days from the receiptof application)

M e d i u m - T e r m

O p e n A c c e s s


licensee


Licensee50000

Proof of payment of Application fee, PPA or Sale-purchaseagreement of power, In case of generating station notalready connected to grid, documentary evidence forcompletion of the connectivity showing that the same shallbe completed before intending date of MTOA

20

Both within thesame State but

differentDistribution

Licensees

STU 100000

Proof of payment of Application fee, PPA or Sale-purchaseagreement of power, In case of generating station notalready connected to grid, documentary evidence forcompletion of the connectivity showing that the same shallbe completed before intending date of MTOA, consentfrom concerned distribution licensees

40

Injection point in

the intra-Statetransmissionsystem within the

State

STU 100000

Proof of payment of Application fee, PPA or Sale-purchaseagreement of power, In case of generating station not

already connected to grid, documentary evidence forcompletion of the connectivity showing that the same shallbe completed before intending date of MTOA, Consentfrom concerned Distribution licensees

40

In different States CTU 100000

Proof of payment of Application fee, PPA or Sale-purchaseagreement of power, In case of generating station notalready connected to grid, documentary evidence forcompletion of the connectivity showing that the same shallbe completed before intending date of MTOA, Consentfrom concerned SLDCs and Distribution licensees as

As per CentralCommissions

Regulation



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20/04/2011 20

Period

Inter-se location of


Nodal agency

Applicati

on fee(Rs.)

Documents to accompany the application

Time frame for disposal of

application (days from thereceipt of application)

L o n g - T e r m

A c c e s s


licensee


Licensee50000

Proof of payment of Application fee, PPA or Sale-purchase agreement of power, In case of generatingstation not already connected to grid, documentaryevidence for completion of the connectivity showing thatthe same shall be completed before intending date ofLTA

20

Both within thesame State but

differentDistribution

Licensees

STU 100000

Proof of payment of Application fee, PPA or Sale-purchase agreement of power, In case of generatingstation not already connected to grid, documentaryevidence for completion of the connectivity showing thatthe same shall be completed before intending date ofLTA, consent from concerned distribution licensees

120 days where augmentation oftransmission system is notrequired150 days, where augmentation oftransmission system is required.

Injection point inthe intra-State

transmissionsystem within the

State

STU 100000

Proof of payment of Application fee, PPA or Sale-purchase agreement of power, In case of generatingstation not already connected to grid, documentaryevidence for completion of the connectivity showing thatthe same shall be completed before intending date ofLTA, Consent from concerned Distribution licensee

120 days where augmentation oftransmission system is not

required150 days, where augmentation oftransmission system is required.

In different States CTU 100000

Proof of payment of Application fee, PPA or Sale-purchase agreement of power, In case of generatingstation not already connected to grid, documentaryevidence for completion of the connectivity showing thatthe same shall be completed before intending date of

LTA, Consent from concerned SLDCs and Distributionlicensees as applicable

As per Central CommissionsRegulation



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20/04/2011 21

Period

Inter-se location

of drawal andinjection point


fee (Rs.)Documents to accompany the

application



S h o r t - T e

r m O

p e n A c c e s s

Both within thesame State (inthe intra-Statetransmission

system)

SLDC 5000Proof of payment of

Application fee,

7 working days in caseSTOA applied for firsttime.3 working days on

subsequent STOAapplications.

Injection point inthe distributionsystem within

the State

SLDC 5000

Consent from concernedDistribution licensee,Proof of payment of

Application fee,

7 working days in caseSTOA applied for firsttime.3 working days on

subsequent STOAapplications.

In differentStates

RLDC of theregion whereconsumer is

located

5000

Consent from concerned SLDCsand Distribution licensee as

applicable,Proof of payment of

Application fee,


Consumer connected to Intra-State Transmission System Regulation 12


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20/04/2011 22

Period

Inter-se locationof drawal andinjection point

Nodalagency

Applicationfee (Rs.)


Time frame for

disposal ofapplication (daysfrom the receiptof application)

M e d i u m - T

e r m

O p e n A c c e s s

Both within thesame State (in

the intra-Statetransmission

system)

STU 100000

Proof of payment of Application fee, PPA or Sale-purchaseagreement of power, In case of generating station orconsumer not already connected to grid, documentary

evidence for completion of the connectivity showing thatthe same shall be completed before intending date ofMTOA

20

Injection pointin the

distribution

system withinthe State

STU 100000

Proof of payment of Application fee, PPA or Sale-purchaseagreement of power, In case of generating station orconsumer not already connected to grid, documentaryevidence for completion of the connectivity showing that

the same shall be completed before intending date ofMTOA, Consent from concerned Distribution licensee

20

In differentStates

CTU 100000

Proof of payment of Application fee, PPA or Sale-purchaseagreement of power, In case of generating station orconsumer not already connected to grid, documentaryevidence for completion of the connectivity showing thatthe same shall be completed before intending date of

MTOA, Consent from concerned SLDCs and Distributionlicensee as applicable

As per CentralCommissions

Regulation



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20/04/2011 23

Period

Inter-se location

of drawal andinjection point

Nodal agency

Applicati

on fee(Rs.)




L o n g - T e r m

A c c e s s

Both within thesame State (inthe intra-Statetransmission

system)

STU 200000

Proof of payment of Application fee, BankGuarantee, PPA or Sale-purchase agreement ofpower, In case of generating station or consumernot already connected to grid, documentaryevidence for completion of the connectivityshowing that the same shall be completed before

intending date of LTA

120 days whereaugmentation oftransmission system is notrequired.150 days, whereaugmentation oftransmission system isrequired.

Injection pointin the

distributionsystem within

the State

STU 200000

Proof of payment of Application fee, BankGuarantee, PPA or Sale-purchase agreement ofpower, In case of generating station or consumernot already connected to grid, documentaryevidence for completion of the connectivityshowing that the same shall be completed beforeintending date of LTA, Consent from concernedDistribution licensee

120 days whereaugmentation oftransmission system is notrequired.150 days, whereaugmentation oftransmission system isrequired.

In differentStates

CTU 200000

Proof of payment of Application fee, BankGuarantee, PPA or Sale-purchase agreement ofpower, In case of generating station or consumernot already connected to grid, documentaryevidence for completion of the connectivityshowing that the same shall be completed before

intending date of LTA, Consent from concernedSTU and Distribution licensee as applicable




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Charges Payable for Open Access

Transmission charges Scheduling and system operation charges payable

to State Load Dispatch Centre (SLDC) Wheeling charges Cross subsidy surcharge Additional Surcharge

Standby charges Imbalance and Reactive Energy Charges (as

applicable)

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Transmission charges Inter State As per CERC Regulations Intra-State :

Transmission charges shall be payable on the basis ofcontracted Capacity/ Scheduled Load or actual power flowwhichever is higher.

Transmission Charges = ATC/(PLS T X365)(in Rs./MW-day)Where,

ATC= Annual Transmission Charges determined by theCommission for the State transmission system for the concerned

year.PLST= Peak load projected to be served by the State transmissionsystem in concerned year.

For Open Access for a part of a day, the transmissioncharges shall be payable on pro-rata basis

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S h d li d i h bl


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Scheduling and system operation charges payableto State Load Despatch Centre (SLDC) In respect of inter-State open access

Long term access or Medium term open accessRLDC fees and charges as specified by the Central Commission.SLDC fees and charges as specified by the Commission under sub-section(3) of section 32 of the Act.

Short-term open access

RLDC and SLDC charges as specified by the Central Commission. In respect of intra-State open access

Long term access or Medium term open accessSLDC fees and charges as specified by the Commission under sub-section(3) of section 32 of the Act.

Short-term open accessA composite operating charge @ Rs.2,000/- per day or part of the dayshall be payable by a short-term open access customer for eachtransaction to the SLDC or as determined by the Commission from timeto time.

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Wheeling charges Wheeling charges shall be payable on the basis of contracted

Capacity/ Scheduled Load or actual power flow whichever ishigher. Wheeling Charges = (ARR PPC TC) /(PLSD X365)

(in Rs./MW-Day)Where, ARR=Annual Revenue Requirement of the distribution licensee in the

concerned year PPC=Total Power Purchase Cost of distribution licensee in the

concerned year TC =Total transmission charges paid by distribution licensee for State

and Inter-State transmission system for the concerned year PLSD=Total Peak load projected to be served by the concerneddistribution system in the concerned year

For Open Access for a part of a day, the wheeling charges shallbe payable on pro-rata basis

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Possible Scenarios

Scenario Connectivityof Generator

Connectivityof Consumer

ApplicableCharges

1 TransmissionSystem

DistributionSystem

Transmission +Wheeling

2 DistributionSystem

TransmissionSystem

Transmission

3 Transmission

System

Transmission

System

Transmission

4 DistributionSystem

DistributionSystem

Wheeling


Source: MPERC Order on Determination of Wheeling Charges and Cross SubsidyCharges (SMP 101/10)


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Cross subsidy surcharge (1/2) Surcharge should be computed by the Tariff Policy formula.

S= T- [C (1+L/100)+D]Where

S is the surcharge T is the Tariff payable by the relevant category of consumers; C is the Weighted average cost of power purchase of top 5% at

the margin excluding liquid fuel based generation andrenewable power

D is the Wheeling charge in per kWh basis

(to be derived from the wheeling charge in Rs./MW-Day referred to inRegulation 22 ) L is the system Losses for the applicable voltage level, expressed

as a Percentage

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Cross subsidy surcharge (2/2) In case the formula gives negative value of surcharge, the same shall be

zero.

The Commission may fix a lower surcharge in the situation of shortagesand load shedding by the distribution licensee.

Cross subsidy surcharge so determined by the Commission shall bereduced by 20% every year at a linear rate.

In case power supply position or the consumer load seeking open accesschanges drastically, the Commission may review the Cross SubsidySurcharge as and when required.

In order to ensure regulatory certainty to a open access consumerapplicant, any change in cross-subsidy surcharge level should be madeapplicable only to the new applicants and the open access alreadysanctioned should not be disturbed.

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Additional Surcharge

This additional surcharge shall become applicableonly if the obligation of the Licensee in terms ofpower purchase commitments has been andcontinues to be stranded or there is an

unavoidable obligation and incidence to bear fixedcosts consequent to such a contract.

Any additional surcharge so determined by theCommission shall be applicable only to the newOpen Access applicants.

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Standby Charges Standby arrangements in cases of outages of generator supplying to open access

customer under open access. Standby arrangements for a maximum period of 42 days in a year, subject to the

load shedding as is applicable to the embedded consumer of the licensee Standby charges at the temporary rate of charge for that category of consumer

subject to the condition that such tariff shall not exceed the highest consumer retailtariff.

In cases where temporary rate of charge is not available for that consumercategory,

the standby arrangements shall be provided by the distribution licensee for amaximum of 42 days in a year and on payment of fixed charges of 42 days andenergy charges for that category of consumer in the prevailing rate schedule.

In case of stand by arrangements sought by continuous process industries, thelicensee shall charge on the basis of actual costs involved in arranging power.

Open Access customers would have the option to arrange stand-by power fromany other source.

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Imbalance settlement With load of less than 10 MW

The difference between the applicable sanctioned Open Access loadand the actual drawal shall be accounted through the Time of Day(ToD) Meters on monthly basis and settled at the rate of theimbalance charge as determined by the Commission (whereimbalance charge has not been determined by the Commission, UIrate as determined by the Central Commission shall be applicable).

In case of under drawal as a result of non availability of thedistribution system or unscheduled load shedding, the open accessconsumer shall be compensated by the distribution licensee at theaverage power purchase cost of the distribution licensee.

With load of 10 MW and above Settled based on the composite accounts for imbalance transactions

issued by SLDC on a weekly cycle based on net metering inaccordance with the rates specified by the Commission.

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Commercial Matters (1/3) Billing, collection and disbursement

Inter-State transactions: Short-term Open Accessfor use of CTU and STU systems as per CERC Regulationsfor use of distribution system open access customer shall pay the charges payable tothe distribution licensee within 3 days from the grant of the short-term open accessby the nodal agency.

Long-term access and medium- term open accessBilling, collection and disbursement of charges payable to RLDC as per CERCRegulations.Bills towards the charges payable to SLDC shall be raised by the STU/SLDC directly tothe open access customer connected to STU and to the distribution licensee inrespect of the customers connected to the distribution system.Distribution licensee shall raise the bill with the open access customer connected to itwithin 3 days of receipt of bill from SLDC.Open access customer connected to the distribution licensee shall pay the chargeswithin five days of receipt of bill from distribution licensee.The distribution licensee shall disburse the amount payable to STU/SLDC on amonthly basis.Open access customer connected to the STU shall pay the bills within five workingdays of receipt of the bill.

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Commercial Matters (2/3) Intra-State transactions:

Short-term Open AccessThe short-term open access customer shall deposit with SLDC thetransmission charges and operating charges within 3 working days of grantof the short- term open access by SLDC.In addition to the above, the short-term open access customer connected todistribution system of a distribution licensee shall also pay to SLDC, thecharges payable to the distribution licensee within 3 days from the grant ofthe short-term open access by the nodal agency. Such charges would bedisbursed to the distribution licensee on a weekly basis.

Long-term and Medium-Term open accessSLDC, transmission licensees and distribution licensee, where applicable,shall communicate to STU the details of the bills due to them by the 3rd dayof the succeeding calendar month.STU shall separately indicate the above charges and raise the bill with theopen access customer, together with the charges receivable by it, if any,before the 5th day of the above month. The open access customer shall paythe charges within 7 days from the date of receipt of the bill. STU shalldisburse the charges payable to SLDC, transmission licensee and distributionlicensee on a monthly basis.

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Commercial Matters (3/3) Late payment surcharge

Delayed in payment by a open access customerbeyond the due date, a late payment surcharge at therate of 1.25% per month shall be levied.

Payment Security Mechanism In case of long-term access and medium-term open

access, the applicant for open access will open an

irrevocable Letter of Credit in favour of the agencyresponsible for collection of various charges for theestimated amount of various charges for a period oftwo months.

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Case Studies



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Sample Surcharge calculation for FY 2010-11

20/04/2011 38

S. No. State

Tariff range(Average billing

rate)

AverageCost ofSupply

power

Purchasecost oftop 5%

Wheelingloss (%) Wheelingcharges Surcharge (As perTariff policy) Median(Surcharge)

T ACS C L D S1=T-[C* (1+L)+D]

Rs./Unit Rs./Unit Rs./Unit % Rs./Unit Rs./Unit Rs./Unit

Minimum

Maximu

m Minimum Maximum1 Bihar 3.52 5.05 4.96 2.91 8.00% 0.32 0.06 1.59 0.85

2 Chhattisgarh 2.53 4.55 3.04 2.93 6.00% 0.17 -0.75 1.27 0.59

3 Gujarat (UGVCL) 4.88 5.31 3.41 3.05 10.01% 0.13 1.40 1.82 1.61

4 Haryana 3.5 4.15 4.93 3.10 6.00% 0.3 -0.09 0.56 0.38

5 Himachal Pradesh 3.47 5.2 4.42 4.24 9.12% 1.01 -2.17 -0.43 -1.62

6 Karnataka (BESCOM) 5.37 7.09 4.66 5.06 2.99% 0.10 0.17 1.78 0.95

7 Madhya Pradesh (East) 3.86 10 4.05 3.23 4.90% 0.49 -0.31 5.83 1.03

8 Maharashtra (MSEDCL-33KV) 5.23 8.43 4.38 4.69 6.00% 0.04 0.22 3.42 1.91

9 Punjab 4.3 5.12 3.87 4.55 10.00% 0.70 -1.41 -0.59 -1.33

10 Uttarakhand 4.17 4.18 3.68 5.02 19.00%0.39 to

0.05 -2.20 -1.85 -1.85


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Calculation for open access charges Gujarat (1)

Short Term Open Access

Particular Value Net value Unit FormulaeContracted Capacity 5 5 MW ATotal Consumption in aMonth(Units)

- 3600000 Kwh B=Ax10^3x30x24

Cross Subsidy Surcharge 0.51 Rs./unit 1836000 Rs. C=Bx0..51Units at T>D grossing up wheeling

loss 10.01% 4000444

Kwh D=A/(1-

10.01%)

Wheeling Charges0.1348Rs./unit 539260 Rs.

E=Dx.1348

Units at G>T grossing upTransmission loss 4.20% 4175829

Kwh F=D/(1-4.20%)

Transmission Charges603

Rs./MW/Day 90450 Rs. G=A*603*30Operating Charge (SLDC Charges) 2000 per day 60000 Rs. H=2000x30OA Application Registration Fee 5000.00 5000 Rs. I

Net Open Access Charge Rs. 2530709.92J=C+E+G+H

+I

Effective Open Access Charge(perUnit) Rs./Unit 0.70 K=J/B


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Long-Term AccessParticular Value Net value Unit

FormulaeContracted Capacity 5 5 MW ATotal Consumption in aMonth(Units)

- 3600000 Kwh B=Ax10^3x30x24

Cross Subsidy Surcharge 0.51 Rs./unit 1836000 Rs. C=Bx0..51Units at T>D grossing up wheeling

loss10.01% 4000444

Kwh D=A/(1-

10.01%)

Wheeling Charges0.1348Rs./unit 539260 Rs.

E=Dx.1348

Units at G>T grossing upTransmission loss 4.20% 4175829

Kwh F=D/(1-4.20%)

Transmission Charges

2410

Rs./MW/Day 361500 Rs.

G=A*2410*3

0Operating Charge (SLDC Charges) 2000 per day 60000 Rs. H=2000x30OA Application Registration Fee 5000.00 5000 Rs. I

Net Open Access Charge Rs. 2801759.92J=C+E+G+H

+IEffective Open AccessCharge(per Unit) Rs./Unit 0.78 K=J/B 40

Calculation for open access charges Gujarat (2)


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20/04/2011 41

Calculation for open access charges-Haryana

Particular Value Net value Unit Formulae

Contracted Capacity 5 5 MW ATotal Consumption in aMonth(Units)

- 3600000 Kwh B=Ax10^3x30x24

Cross Subsidy Surcharge 0.72 Rs./unit 2592000 Rs. C=Bx0.72Units at T>D grossing up wheelingloss 6.00% 3829787

KwhD=A/(1-6%)

Wheeling Charges 0.26 Rs./unit 995745 Rs. E=Dx.26Units at G>T grossing upTransmission loss 2.10% 3911938

KwhF=D/(1-2.10%)

Transmission Charges 0.28 Rs./unit 1095343 Rs. G=F x .28

Operating Charge (SLDC Charges) 2000 per day 60000 Rs. H=2000x30

OA Application Registration Fee 5000.00 5000 Rs. I

Net Open Access Charge Rs. 4748087.30 J=C+E+G+H+I

Effective Open Access

Charge(per Unit) Rs./Unit 1.32 K=J/B


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Typical Example for Power Exchange Trades (1)


Calculation of Landed Cost for Consumers in Punjab (Typical through Power Exchange)33 kV 132 kV & above

Volume Traded in MW 5 5Hours Traded 8 8

Total Volume in MWh (at Regional Periphery) 40 40

Rate at Regional Periphery (in Rs per unit)** 2.50 2.50

LossesNR Loss# 4.00% 4.00%

0.00% 0.00%

State & Wheeling Losses 10.00% 6.00%

Cost After Losses (in Rs per unit) 2.86 2.76

Charges

State Transmission Charges (in Rs/unit ) 0.03 0.03

Central Transmission Charges per unit @ Rs 100/MWh

(in Rs/unit) 0.10 0.10Wheeling Charges (in Rs/unit) 0.13 0.00

NLDC Operating Charges+ NLDC ApplicationCharges+SLDC Charges* 0.08 0.08

Transaction Charges @ Rs 10 per MW (in Rs/unit) 0.01 0.01

Professional Fees ( If transacted through Member)* * 0.02 0.03

Cross Subsidy Charges (in Rs/unit) 0 0

Rate @ ex Metering Point (in Rs/unit) 3.23 3.00


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Typical Example for Power Exchange Trades (2)


Calculation of Landed Cost for Consumers in Gujarat>66 kV

Volume Traded in MW 5Hours Traded 8

Total Volume in MWh (at Regional Periphery) 40

Rate at Regional Periphery (in Rs per unit)** 2.50

LossesWR Loss 6.00%

State Loss 4.29%Wheeling Losses 0.00%

Cost After Losses (in Rs per unit) 2.76

Charges

State Transmission Charges (in Rs/unit ) 0.60

Central Transmission Charges per unit @ Rs 100/MWh (inRs/unit) 0.10

Wheeling Charges (in Rs/unit)# 0.00

NLDC Operating Charges+ NLDC Application Charges+SLDCCharges* 0.08

Transaction Charges @ Rs 10 per MW (in Rs/unit) 0.01

Professional Fees ( If transacted through Member)* * 0.02

Cross Subsidy Charges (in Rs/unit) 0.51

Rate @ ex Metering Point (in Rs/unit) 4.08


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Issues in Intra State Open Access


Open Access in Inter-State Transmission :


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Open Access in Inter State Transmission :Key Success Factors Control area demarcation & boundary metering Robust transmission system Assessment of Transfer Capability Balancing mechanism Methodology for transmission charge sharing Treatment of transmission losses Streamlined scheduling and settlement mechanism Transparency and non-discriminatory implementation Compliance Dispute redressal mechanism Congestion management


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Calculation of Cross Subsidy Surcharge The formula uses the weighted average cost of power

purchase of top 5 % as a factor and this leads to anegative cross subsidy surcharge in certain cases Allowing consumers to migrate to open access

increases the burden of the DISCOM The calculation of the cross subsidy surcharge is beingdone with reference to the average cost of supply

instead of the cost of serving the consumer. As aconsequence, there is an under-recovery and the

concerned utility is under-compensated. A trajectory for continuous reduction of the crosssubsidy surcharge has to be identified andimplemented by the States.



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Standby Charges The various provisions of Act and Policies mandate

the DISCOM of providing standby to OA customers. Unfair on behalf of DISCOMs to keep non open access

consumers in dark and provide standby without levyingreasonable charges for the standby supply arrangements.

As per the latest FOR guidelines, demand charges forstandby supply can be charged for 42 days in a year.

However, some of the States raised the issue that standbycharges should be payable for the entire 365 days.

Solution ? Purchase from market Enter into a PPA


l l f


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Dilemma in Planning for Procurement Some States have an ambitious plan of achieve load

shedding free power supply in the State by . Planned for power procurement by entering in Long term

Contracts or through competitive bidding routes. In case the bulk consumers are allowed to migrate to open

access, then, this additional capacity being procured mayresult in stranded assets.

DISCOMs would be left with burden of fixed charges ofLong Term PPAs entered into, to the extent of migratedload resulting in increase in Supply related costs.

Possible Solution A vibrant market working in the country In case a particular State becomes surplus, the surplus as

and when available can be sold in the market.


Development of Intra State Transmission &


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Development of Intra State Transmission &Distribution Network Open access presupposes the existence of a

robust transmission or distribution network.

Many of the States are experiencing a high loadgrowth and commensurate augmentation of thetransmission and distribution infrastructure insidethe States needs urgent attention to

accommodate open access transactions.


M h i f H dli I b l


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Mechanism for Handling Imbalances

Availability Based Tariff has been implemented atthe inter-State level

Implementation of the ABT Mechanism at inter-Statelevel has been one of the crucial touchstones for the

success story of open access at the inter-state level.

A similar commercial mechanism needs to be

implemented at the intra-State level Should also include a mechanism for handling

imbalances.


Procedural Issues including Metering, Settlement


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g g,and Accounting Issues Clear procedures including the timelines for

approval/clearance of open access needs to beclearly defined by the States.

In order to avoid flip-flop situation, the need for aminimum time period for availing open accesswas also felt.

Metering, Settlement and Accounting Systemsneed to be established and streamlined.


P d l Cl i


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Procedural Clarity Imbalance settlement

Treatment of under-drawal and over-drawl by Open AccessConsumer

Metering Arrangements ToD meter or SEM Meter specifications Costs involved

Billing Arrangements

Procedure for billing Entities responsible for billing for wheeling, energy

component etc. Manner of payment of bills

B h f PPA


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Breach of PPAs

Breaching an already existing PPA to sell power inthe open market.

Honouring contracts is important Need to initiate necessary safeguards for this.

Interplay of the prices in the market also leadingto a possibility of gaming.


I t t ti f S ti 11 EA 2003


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Interpretation of Section 11, EA 2003

Direction to generating companies

11. The Appropriate Government may specify that a generatingcompany shall, in extraordinary circumstances operate andmaintain any generating station in accordance with thedirections of that Government. Explanation. - For the purposesof this section, the expression extraordinary circumstancesmeans circumstances arising out of threat to security of theState, public order or a natural calamity or such othercircumstances arising in the public interest.

The Appropriate Commission may offset the adverse financialimpact of the directions referred to in sub-section (1) on anygenerating company in such manner as it considersappropriate


N d f R ti li ti f OA Ch


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Need for Rationalization of OA Charges

Several charges levied for Open access indistribution.

Charges are high in many States. Charges need rationalization and alignment with

Tariff Policy formulation FOR has already recommended the principles for cross

subsidy surcharge should be as per the Tariff Policy. Charges should be such that it facilitates open

access and does not restrict it.

55

O A Ch g i i T iff


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Open Access Charges vis a vis Tariff

S. No. State Net Open AccessCharges (Rs/Kwh)

Net cost of powerfrom Open Access

(Rs./kWh)**

Tariff (Discom)*(Rs./kWh)

1 Assam 2.94 6.94 3.25 2 Chhattisgarh (Short term) 1.00 5.00 3.38 3 Haryana 1.03 5.03 4.57 4 Himachal Pradesh 1.32 5.32 3.04 5 Karnataka (BESCOM) - ST 1.00 5.00 4.15 6 Maharashtra (MSEDCL area) 0.84 4.84 4.53 7 Orissa ( WESCO) 1.81 5.81 2.91

8 Punjab ( short term) 0.61 4.61 5.09 9 Rajasthan 0.97 4.97 3.98

10 Uttar Pradesh ( short term) 0.66 4.66 4.29 11 Madhya Pradesh 1.00 5.00 4.57 12 Uttarakhand ( Long term) 1.47 5.47 3.9 13 Gujarat 1.34 5.34 7.39 14 West Bengal - short term 2.81 6.81 3.95 15 Tamil Nadu 2.47 6.47 3.96 16 Delhi 1.93 5.93 4.05 17 Andhra Pradesh 0.97 4.97 3.49 18 Kerala 2.38 6.38 3.94 19 Bihar ( HTS) 2.56 6.56 4.35 20 Jharkhand 1.44 5.44 4.48

*Tariff for an embedded consumer of 5MW at 11 KV (33 KV in some cases).** Effective Open Access Charges for consumer of 5MW at 11 KV (33 KV in some cases) in addition with aassumption of power purchase cost of 4 Rs./KwH. 56

O A Ch g i i T iff


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Open Access Charges vis a vis Tariff

57

0.00 1.00 2.00 3.00 4.00 5.00 6.00 7.00 8.00

AssamChhattisgarh (Short term)

HaryanaHimachal Pradesh

Karnataka (BESCOM) - STMaharashtra (MSEDCL area)

Orissa ( WESCO)Punjab ( short term)

RajasthanUttar Pradesh ( short term)

Madhya PradeshUttarakhand ( Long term)

GujaratWest Bengal - short term

Tamil NaduDelhi

Andhra PradeshKerala

Bihar ( HTS)

Jharkhand

6.945.005.03

5.325.00

4.845.81

4.614.97

4.665.00

5.475.34

6.816.47

5.934.97

6.386.56

5.44

3.253.38

4.573.04

4.154.53

2.915.09

3.984.29

4.573.9

7.393.953.96

4.053.49

3.944.35

4.48

Tariff (Discom) (Rs./kWh)* Net cost of power from Open Access (Rs./kWh)**

*Tariff for an embedded consumer of 5MW at 11 KV (33 KV in some cases).** Effective Open Access Charges for consumer of 5MW at 11 KV (33 KV in some cases) inaddition with a assumption of power purchase cost of 4 Rs./Kwh.


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CrossSubsidySurchargein

DifferentStates

Source:Forum ofRegulators

State Load Despatch Centers (SLDC)


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State Load Despatch Centers (SLDC)

Section 32(1), Electricity Act 2003:

The State Load Despatch Centre shall be theapex body to ensure integrated operation of thepower system in a State

Functions of SLDC


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Functions of SLDC

Section 32 (2), EA 2003:

The State Load Despatch Centre shall -(a) be responsible for optimum scheduling and despatch of electricity within aState, in accordance with the contracts entered into withthe licensees or thegenerating companies operating in that State;

(b) monitor grid operations;(c) keep accounts of the quantity of electricity transmitted through the

State grid;(d) exercise supervision and control over the intra-state transmission system;and(e) be responsible for carrying out real time operations for grid control anddespatch of electricity within the State through secure and economic operationof the State grid in accordance with the Grid Standards and the State Grid Code

Ring Fencing of Load Despatch Centers


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Ring Fencing of Load Despatch Centers LDCs to be ring fenced suitably to ensure their

functional autonomy. ERCs to recognize three distinct revenue streams for

making LDCs financially self reliant. Fees and charges for system operation Tariff for decision support system and IT infrastructure. Operating charges for scheduling, metering and

settlement.

Introduction of system of certification of systemoperators by an independent central body. Proper compensation structure for LDCs to attract

and retain best talent61

FOR Recommendations: Way Forward


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FOR Recommendations: Way Forward

Rationalization of various open access chargesincluding surcharge

Uniform standby arrangement for back-up supplyto make open access a reality

Monitoring of open access transactions by theState Commission

Display of illustrative examples of charges foropen access to help the potential consumer takean informed decision on the open access option.



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