(1) The Commission shall set targets for each year of the control period for the items or parameters that are deemed to be “controllable” and which will include-
(a) Normative Annual Plant Availability Factor;
(b) Auxiliary energy consumption;
(c) Operation and Maintenance Expenses which includes employee expenses, repairs and maintenance expenses, administration and general expenses and other miscellaneous expenses viz. audit fees, rents, legal fees etc;
(d) Financing cost which includes cost of debt including working capital (interest), cost of equity (return); and
(e) Depreciation.
(2) The Commission will normally not revisit the performance targets, once determined even if the targets are fixed on the basis of un-audited accounts.
1 [9. True Up.- (1) The true up across various controllable parameters shall be conducted by the Commission, for the previous years for which the actual/audited accounts are made available by the generator, at the times and as per principles stated below: - (A) at the times - 1 Ins. 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. 4599-4606.Before its substitution it read as under:
“9. True Up.- (1) The true up across various controllable parameters shall be conducted as per principles stated below: -
(a) any surplus and deficit on account of O&M expenses shall be to the account of the generating company and shall not be trued up in ARR; and
(b) at the end of the control period –
(i) the Commission shall review actual capital investment vis-à-vis approved capital investment;
(ii) depreciation and financing cost, which includes cost of debt including working capital (interest), cost of equity (return) shall be trued up on the basis of actual/audited information and prudence check by the Commission.
(2) Notwithstanding anything contained in these regulations, the gains or losses in the controllable items of ARR on account of force majeure factors shall be passed on as an additional charge or rebate in ARR over such period as may be laid down in the order of the Commission.” Compendium of HPERC Regulations, March 2021 9
(i) for the previous years of the previous control period along with the petition for determination of ARR cum generation tariff for the control period;
(ii) for the previous years of the control period and for the previous control period:-
(iii) along with the mid-term performance review during the control period; and
(iv) for the control period true up:- along with the mid-term performance review of the next control period;
(B) as per principles –
(i) the Commission shall review actual capital investment vis-à-vis approved capital investment;
(ii) depreciation and financing cost, which includes cost of debt including working capital (interest), cost of equity (return) shall be trued up on the basis of actual/audited information and prudence check by the Commission;
and
(iii) any surplus and deficit on account of O&M expenses shall be to the account of the generating company and shall not be trued up in ARR.
(2) The gain or loss on account of other controllable factors, unless otherwise specifically provided by the Commission shall be to the account of the generating company.
(3) Notwithstanding anything contained in these regulations, the gains or losses in the controllable items of ARR on account of force majeure, change in law and change in taxes and duties shall be passed on as an additional charge or rebate in ARR over such period as may be laid down in the order of the Commission.]
1 [9-A. Carrying Cost.—The generating company, for the approved true-up of any year over and above that approved in the Tariff Order for that year, shall be entitled to a carrying cost at one (1) Year weighted average State Bank of India (SBI) MCLR/any replacement thereof as notified by RBI for the time being in effect applicable for one (1) Year period of the relevant Year plus 300 basis points and for any true-up resulting in less than that approved in the Tariff Order for that year, the carrying cost shall be recovered at the same rate.]
2 [10. Refund of excess amount.— If a generating company recovers the charges exceeding the tariff determined by the Commission, the excess amount shall be refunded to beneficiaries, who have paid such excess charges, along with interest equivalent to the one
(1) Year State Bank of India (SBI) MCLR/any replacement thereof as notified by RBI for the time being in effect applicable for one (1) Year period, as may be applicable as on 1 st April of the Financial Year plus 300 basis points, without prejudice to any other liability to which such generating company may be subject:
1 Ins. ‘regulation 9-A’ vide Not. No. HPERC-F(1)-2/2018 dated 22 nd November, 2018 published in the R.H.P. 27 th November, 2018 at p. 6249-6255.
2 Sub. vide Not. No. HPERC-F(1)-2/2018 dated 22nd November, 2018 published in the R.H.P. 27th November, 2018 at p. 6249-6255. Before its substitution it read as under:
“10. Refund of excess amount .- If a generating company recovers the charges exceeding the tariff determined by the Commission, the excess amount shall be refunded to beneficiaries, who have paid such excess charges, alongwith interest equal to the prevalent Base Rate of the State Bank of India plus 350 basis points, without prejudice to any other liability incurred by such licensee.” 10 Compendium of HPERC Regulations, March 2021
Provided that such interest payable to any party shall not be allowed to be recovered through the Aggregate Revenue Requirement of the generating company:
Provided further that the generating company shall maintain separate details of such interest paid or payable by it, and shall submit them to the Commission along with its petition.]
1 [10-A. Preparation of Accounting Manual and Regulatory Accounts.— The Generating Company shall prepare Accounting Manual and Regulatory Accounts as per the Himachal Pradesh Electricity Regulatory Commission (Reporting System on Power Regulatory Accounting) Regulations, 2014. The Utility shall submit the Regulatory Audited Accounts Every year within seven months of the end of the Financial Accounting Year to the Commission.
10-B. Segregation of Accounts.—The generating company shall maintain separate accounts for each of its hydro power plants:
Provided that the generating company shall follow a reasonable basis for allocation of all joint and common costs between the power plants and shall submit the Accounting Statements, as approved by its board of directors, to the Commission alongwith its application for determination of tariff.
10-C. Consumer Contribution, Deposit Work, Grant and Capital Subsidy.—
(1) The works carried out by the generation company after obtaining the estimated cost from the users shall be classified as Deposit Works.
(2) Capital works undertaken by the generation company utilising grants received from the State and Central Governments, including funds under various schemes shall be classified under the category of Grants.
(3) The works carried out with any other grant of similar nature or such amount received without any obligation to return the same and with no interest costs attached to such subvention shall also be classified as works performed through consumer contribution, deposit work, capital subsidy or grant.
(4) The expenses on such capital expenditure shall be treated as follows:—
(a) normative O&M expenses as specified in these regulations shall be allowed.However, any departmental charges taken by the generating company against deposit works and which are executed departmentally shall be adjusted in the employee cost;
(b) the debt to equity ratio shall be considered in accordance with Regulation 16, after deducting the amount of financial support provided through consumer contribution, deposit work, capital subsidy or grant;
(c) depreciation to the extent of work s performed through consumer contribution, deposit work, capital subsidy or grant shall not be allowed as specified in Regulation 20;
(d) provisions related to return on equity, as specified in Regulation 21, shall not be applicable to the extent of financial support provided through consumer contribution, deposit work, capital subsidy or grant;
1 Ins. ‘regulation 10-A, 10-B & 10-C’ vide Not. No. HPERC-F(1)-2/2018 dated 22 nd November, 2018 published in the R.H.P. 27 th November, 2018 at p. 6249-6255.
Compendium of HPERC Regulations, March 2021 11
(e) provisions related to interest and finance charges, as specified in Regulation 17, shall not be applicable to the extent of financial support provided through consumer contribution, deposit work, capital subsidy or grant.]
PART-III PRINCIPLES FOR DETERMINATION OF HYDRO GENERATION TARIFF