Jharkhand State Electricity Regulatory Commission Order on True-up for FY 2017-18, Annual Performance Review for FY 2018-19 and Mid-Term Review for Revised Annual Revenue Requirement and Generation Tariff for FY 2019-20 & FY 2020-21 for Tata Power Company Limited (TPCL) Ranchi February 14, 2020 True-up for FY 2017-18, APR for FY 2018-19 and Mid-Term Review for FY 2019-20 & FY 2020-21 CONTENTS CONTENTS ..............................................................................................................................2 LIST OF ABBREVIATIONS ...................................................................................................6 LIST OF TABLES ....................................................................................................................7 A 1: INTRODUCTION ........................................................................................................ 12 Jharkhand State Electricity Regulatory Commission .............................................................. 12 Tata Power Company Limited (TPCL) .................................................................................. 14 The Petitioner’s Prayers ......................................................................................................... 14 Scope of the Present Order .................................................................................................... 15 A 2: PROCEDURAL HISTORY ......................................................................................... 17 Background ........................................................................................................................... 17 Information Gaps in the Petitions ........................................................................................... 17 Inviting Public Comments/Suggestions .................................................................................. 18 Submission of Comments/Suggestions and Conduct of Public Hearing .................................. 18 A 3: BRIEF FACTS OF THE PETITION .......................................................................... 20 Truing up for FY 2017-18...................................................................................................... 20 Operational Parameters of Plant ....................................................................................... 20 Revenue Gap/(Surplus) for FY 2017-18 .............................................................................. 20 ANNUAL PERFORMANCE REVIEW FOR FY 2018-19 .................................................... 21 MID-TERM REVIEW: FY 2019-20 & FY 2020-21 .............................................................. 22 A 4: PUBLIC CONSULTATION PROCESS ..................................................................... 25 Issue related to Pollution & Health Hazard ............................................................................ 25 Ash Pond ............................................................................................................................... 26 Public Liability Insurance Act, 1991 ...................................................................................... 26 Expenditure for CSR Activities.............................................................................................. 27 Annual Shutdown .................................................................................................................. 28 Technology Improvement for Economical & Reliable Power ................................................. 29 Electricity Subsidy................................................................................................................. 29 Periodic Increase in Tariff ..................................................................................................... 29 Sharing of Incentive with Beneficiary .................................................................................... 30 Issue related to Additional Capitalization ............................................................................... 30 O&M Expenditure ................................................................................................................. 32 Comparison of Energy Tariff ................................................................................................. 32 Jharkhand State Electricity Regulatory Commission 2 | P a g e True-up for FY 2017-18, APR for FY 2018-19 and Mid-Term Review for FY 2019-20 & FY 2020-21 Capitalization related to FGD Scheme ................................................................................... 33 O&M Expenditure ................................................................................................................. 34 Supplying power in Adityapur-Saraikela-Kharsawan area ..................................................... 34 Data related to fly ash & water tax ......................................................................................... 35 Expenditure related to Non-Regulated Units .......................................................................... 35 Ash Disposal Expenses .......................................................................................................... 36 Documents related to Loan .................................................................................................... 36 A 5: TRUE-UP FOR FY 2017-18 ......................................................................................... 38 Operational Performance ....................................................................................................... 38 Plant Availability Factor (PAF) ......................................................................................... 38 Auxiliary Consumption ....................................................................................................... 39 Plant Load Factor and Generation..................................................................................... 40 Gross Station Heat Rate (GHR) ......................................................................................... 41 Specific Fuel Oil Consumption ........................................................................................... 41 Fuel Cost Parameters ............................................................................................................. 43 Coal Mix and Gross Calorific Value (GCV) of Primary Fuel ............................................. 43 Transit Loss ....................................................................................................................... 45 Landed Cost of Coal .......................................................................................................... 47 Calorific value and Cost of Secondary Fuel ....................................................................... 48 Energy Charge Rate (ECR) .................................................................................................... 49 Summary of Fuel Cost ........................................................................................................... 51 Determination of Fixed Cost .................................................................................................. 52 Additional Capitalization ................................................................................................... 52 Depreciation ...................................................................................................................... 62 Operation & Maintenance Expenses .................................................................................. 65 Interest on Loan ................................................................................................................. 70 Interest on Working Capital (IoWC) ................................................................................... 72 Return on Equity ................................................................................................................ 74 Tax on Saving on Operational Parameters ......................................................................... 76 Tax Liability on Gain on Secondary Fuel ........................................................................... 77 Tax Liability on Gain on Auxiliary Power Consumption ..................................................... 78 Tax Liability on Gain on Station Heat Rate ........................................................................ 78 Summary of Annual Revenue Requirement ......................................................................... 79 Revenue from Sale of Power ................................................................................................. 79 Jharkhand State Electricity Regulatory Commission 3 | P a g e True-up for FY 2017-18, APR for FY 2018-19 and Mid-Term Review for FY 2019-20 & FY 2020-21 Gap/Surplus for FY 2017-18 .................................................................................................. 80 A 6: ANNUAL PERFORMANCE REVIEW FOR FY 2018-19 ......................................... 82 Operational Performance ....................................................................................................... 82 Plant Availability Factor (PAF) ......................................................................................... 82 Auxiliary Consumption ....................................................................................................... 83 Plant Load Factor and Generation....................................................................................