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Queries raised by Director (Tariff) on ARR and Tariff Application of OHPC for FY 2011-12 on 02.02.2011.

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Presentation on theme: "Queries raised by Director (Tariff) on ARR and Tariff Application of OHPC for FY 2011-12 on 02.02.2011."— Presentation transcript:

1 Queries raised by Director (Tariff) on ARR and Tariff Application of OHPC for FY on

2 2 OHPC has claimed an interest amount for Upper Indravati Project of Rs on the Govt. of Orissa loan of Rs cr., for the year The outstanding loan as on was Rs cr. The Commission had allowed depreciation of the order of Rs cr. in tariff order for OHPC. Therefore, the balance loan outstanding as on is Rs cr. minus Rs cr. which equals to Rs cr. The present claim of OHPC in respect of interest on this principal amount is Rs cr.

3 3 The Govt. of Orissa notification dtd had mentioned that the State Govt. investment actually made in Upper Indravati Project, excluding equity, should yield a return to the State Govt. with effect from FY after loan liabilities of PFC are cleared. OHPC has claimed the interest amount based on the above notification.

4 4 However, if we allow this Rs cr. towards interest payment, the average tariff of Upper Indravati comes to p/u as projected by OHPC. If we do not allow this interest amount the average tariff of Upper Indravati comes down to p/u approximately i.e. a reduction of the order of p/u. Since the net energy sold by Upper Indravati accounts to 35% of total hydro energy sold by OHPC, this interest component of Upper Indravati shall have a significant impact on average tariff of OHPC. This is worked out at 6.8 p/u.

5 OHPC should, therefore, pursue this matter of interest payment with the State Govt. to convert this as interest free loan in order to avoid a tariff shock to the consumers. In any case the Commission has already allowed depreciation of the order of Rs cr. to Upper Indravati during For the FY , OHPC has already claimed the same amount under the head depreciation which the Commission may allow towards principal repayment for this State Govt. loan. 5

6 OHPC has claimed license fee for consumption of water for generation of electricity to the tune of Rs cr. for to be paid to the Govt. as per the Gazette Notification dtd The impact of this claim is 1 p/u for the entire energy sold by OHPC. Since OHPC is a Govt. owned corporation and the water is used for non-consumptive purpose, the State Govt. may waive this license fee for OHPC. 6


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