(1) Existing Stations:
(a) For existing generating stations the amount of loan capital shall be equal to the sum of the outstanding balance of all long term loans taken to finance the generating station, at the commencement of the financial year for which tariff is to be determined, as reflected in the tariff orders of the Commission.
(b) The equity capital shall be taken as specified by the generating company, subject to prudence check by the Commission.
(c) Any fresh infusion of capital in the existing generating stations shall be considered only after prior approval by the Commission, and would have a debt-equity ratio of 70:30.
(2) New Stations:
(a) For new stations, the normative debt-equity ratio shall be considered to be 70:30 for determination of tariff.
1 Proviso Ins. vide Not. No. vide Not No. HPERC/F (5)(3)(1) (Gen.) dated 1 st Nov., 2013 published in the R H.P. dated 4 th November, 2013 at p. 4606.
Compendium of HPERC Regulations, March 2021 15
(b) In case of a generating station where equity employed is more than 30%, the amount of equity for determination of tariff shall be limited to 30% and the balance amount shall be considered as the normative loan.
(c) In case of a generating station where actual equity employed is less than 30%, the actual debt and equity shall be considered for determination of tariff:
Provided that the equity invested in foreign currency shall be designated in Indian rupees on the date of each investment.
(3) Renovation and Modernisation .- Any approved capital expenditure incurred on renovation, modernisation, replacement or extension of life of existing generating assets shall be considered to be financed at a normative debt-equity ratio of 70:30. In case the amount of equity is less than 30%, the actual debt-equity ratio shall be considered.
(4) The debt and equity amounts arrived at in accordance this regulation shall be used for calculating interest on loan, return on equity, advance against depreciation and foreign exchange rate variation.