(1) Where, after the allotment of the original project, the capacity of a SHP is enhanced, with the approval of the State Government, the tariff for sale of net saleable energy from such projects, shall be governed by the relevant provisions of sub-regulations (2) to (7).
(2)Where neither the Commission has approved, nor the parties have executed, the Power Purchase Agreement for the original capacity, the enhanced capacity shall be taken into consideration while approving or executing the Power Purchase Agreement, as the case may be.
(3)Where the Commission has approved, or the parties have otherwise executed, the Power Purchase Agreement prior to the commencement of these Regulations –
(i) if the total capacity of the project, after enhancement, does not exceed 5 MW, the tariff applicable as per the Power Purchase Agreement for the original capacity shall be applicable for the net saleable energy for the enhanced capacity subject to adjustment in tariff on account of free power in accordance with sub-regulation (6);
(ii) if the original capacity of the project was not more than 5 MW but the capacity, after enhancement, exceeds 5 MW, the tariff applicable as per the Power Purchase Agreement for the original capacity shall be reduced by 10% to account for the expected reduction in the expenses on normative basis and shall then be adjusted to account for the free power in accordance with subregulation (6) by taking into account the free power (in percentage) factored in the tariff for the original capacity as per the Power Purchase Agreement and free power (in percentage) to be allowed in the tariff:
Provided that a levellised rate based on the rate applicable as per power purchase agreement for the original capacity, adjustments under this clause, the duration of residual tariff period and the discount rate determined by the Commission under these Regulations, shall be applicable for the residual tariff period.
Compendium of HPERC Regulations, March 2021 17
(iii) if the original capacity of the project was more than 5 MW and the Power Purchase Agreement spells out the rate applicable for sale of net saleable energy, the tariff applicable as per the Power Purchase Agreement for the original capacity shall be applicable for the net saleable energy for the enhanced capacity subject to adjustment in tariff on account of free power in accordance with sub-regulation (6);
(iv) if the original capacity of the project was more than 5 MW and the Power Purchase Agreement does not spell out the rate applicable for sale of net saleable energy, the Commission may, on joint application from the licensee and the renewable energy generator, determine the project specific levellised tariff, after accounting for the free power subject to maximum limits outlined in sub-regulation(3) of regulation 35, by duly taking into account the Policy of the State Government/ Regulations/practices prevalent in the timeframe in which the Power Purchase Agreement was executed for the original capacity, and such other factors/norms as it may consider appropriate.
(4) Where the Power Purchase Agreement for the original capacity of a small hydro project covered in these Regulations is approved and executed after the commencement of these Regulations, the generic levellised tariff as well as other associated terms and conditions applicable for the relevant category of SHPs under which the enhanced capacity of the SHPs falls shall be applicable for the entire capacity:
Provided that if such Power Purchase Agreement for the original capacity contains provision for determination of project specific levellised tariff, the Commission may, on application from both the parties, determine the project specific levellised tariff by taking into account the norms applicable for the category of SHPs in which the enhanced capacity of the project falls.
(5) Where the Power Purchase Agreement has been executed for the original capacity and the renewable energy generator sells energy, under the relevant Regulations governing REC mechanism, to the distribution licensee from the additional capacity under REC mechanism with a provision to sell such energy to the licensee for the balance part of the tariff period after exit from the REC mechanism, the following provisions shall apply :-
(i) the tariff for the entire net saleable energy for the residual part of the tariff period shall be fixed/determined in accordance with sub regulation (3) or (4), as the case may be;
(ii) during the interim period when the energy is sold partly under the Power Purchase Agreement for the original capacity and partly through the REC mechanism-
(a) unless provided otherwise in the Power Purchase Agreement for the original capacity, the tariff applicable for the original capacity shall not be subject to any adjustment, on account of variation in free power, under sub-regulation (6),
(b) the total net saleable energy shall be apportioned in a firm ratio on the basis of original capacity and the enhanced capacity.
18 Compendium of HPERC Regulations, March 2021
(6) In the cases covered by sub-regulations (3), (4) and clause (i) of sub-regulation
(5), the tariff shall be adjusted on account of variation in the free power in accordance with sub- regulations (2) and (3) of regulation 35:
Provided that in case capacity enhancement is approved by the State Government, the percentage rate of free power undergoes change due to-
(i) any change in general policy during the intervening period between the dates of execution of Implementation Agreements for the original capacity and the Supplementary Implementation Agreement for the enhanced capacity, e.g. on account of Local Area Development, change in basic rates, change in the category of the project based on the capacity etc; or
(ii) additional free power specifically for enhancement of capacity; the variations in free power on account of item (i) shall only be considered for adjustment in tariff as per sub-regulations (2) and (3) of regulation 35, but additional free power for capacity enhancement as per item (ii) shall not be considered for tariff adjustment.
(7) Where the parties fail to arrive at an understanding for sale/purchase of energy in the manner specified in sub-regulations (3) to (6), the right of the distribution licensee for the net saleable energy as per the original Power Purchase Agreement, duly taking into account the data contained in the Detailed Project Report for the original capacity and power generation on real time basis, shall remain protected and the renewable energy generator shall be eligible to dispose off only the net incremental saleable energy (i.e. after duly adjusting the licensee’s first right as aforesaid and the total quantum of free energy for the enhanced capacity of the Project):
Provided that in such a case, the renewable energy generator shall also arrive at an understanding with the distribution licensee about the modalities for energy accounting on real time basis as well as on monthly and annual basis and based on the same, the renewable energy generator shall also make the distribution licensee a party to any such agreement for disposal of such incremental energy:
Provided further that in case the licensee and the renewable energy generator mutually agree to purchase/sell the net incremental saleable energy at a specific rate and jointly make an application to the Commission for determination of such rate, the Commission may determine the specific levellised rate for such net incremental saleable energy as per the provisions of this sub-regulation and by taking into account the provisions of the regulations/practices prevalent in the time frame during which the capacity enhancement was permitted by the State Government.
(8) Where, after the Commission has approved the power purchase agreement for sale of power from a project based on a renewable technology other than SHP, the capacity of the project is enhanced, the tariff for sale of net saleable energy from such project shall be governed by such terms and conditions as may be included by the Commission, to address such situations, in the terms and conditions fixed by it under regulation 17.