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energetica-india-57_asiapowerweek

ENERGETICA INDIA Benchmark capital cost norm for Solar PV & Solar Thermal power projects applicable during FY 2016-17 CERC has, after consultation with stakeholders, come out with applicable benchmark capital costs for Solar PV & Solar Thermal power projects applicable during FY 2016-17 Solar PV Projects Module Prices To ensure no quality concerns and life span of 25 years, CERC has considered Tier-1 module prices. Industry players such as Adani Power, Tata Solar, Welspun etc. have also suggested that module prices be considered at $0.48/W. Thereby, the Commission sets module prices at $0.48/W, assuming prices are expected to be fairly stable in the coming year. Regarding the domestic content requirement, the Commission has clarified that the present exercise of benchmark capital cost is for generic tariff and not for project specific projects. Exchange Rate During the discussion, stakeholders pointed out that Indian Rupee has been depreciating for the past several months. Several companies such as Suzlon, Tata Solar, Adani and Solar Power Developer Association suggested that currency future market data from NSE be used for arriving at the exchange rate assumption for 2016-17. The Commission responded saying that the currency risk in the current global scenario cannot be ascertained in advance and believes that the average exchange rate for the most recent six months should be considered. For September 2015 to February 2016, the average exchange rate was 66.59 INR/USD, as per RBI website, which is closer to the prevalent exchange rate. The Commission decided to use this exchange rate for the benchmark cost model. Module Degradation Industry players suggested incorporation of degradation of modules in reduced PLF of the modules. However, since PLF is already fixed at an average value of 19% for solar PV projects (and 23% for solar thermal projects) for this control period, the Commission has sought to compensate the developers with additional capital cost. A degradation of 0.5% is assumed on a yearly basis, which is then applied to module cost to arrive at yearly degradation cost, followed by discounting to arrive at the net present value of this degradation cost at Rs.8.77 lakhs/MW Land It is understood among all stakeholders that land costs vary from state to state and based on the particular location of the projects. However, it must be noted that typically land deployed for these projects is barren in nature. Additionally, land cost has been stagnant over the last financial year. Thus, the Commission retained the land cost at Rs. 25 lakhs/MW. Civil & General works The cost of civil works depends on the quality of soil, ground water table, contour of ground, etc. The Commission has taken all these cost components into account. However, it said that this cost is on a per MW basis, and as plant size increases to 5-10 MW, the costs of control/inverter room, boundary wall, approach road, lighting, etc. get distributed over a larger base. It is neither feasible nor prudent to account for special ground or soil conditions in a generic tariff order. Civil works include preparation of terrain for digging, levelling and mounting, building control room to house inverter and other BoS components, building approach roads, fencing or boundary wall, cable trenching, arranging water supply, lighting etc. General works include security of solar farm, setting up of power back-up generator; yard lighting, earthing kits, etc. The Commission decided to retain cost of civil works at Rs. 35 lakhs/MW. Mounting Structures Industry players have stated that depending on wind speeds, amount of steel used will vary from 50 MT/MW to 70 to 100 MT/MW. This is a rather wide range of amount of material needed. The Commission felt that 40-45 MT of steel per MW is a good benchmark assumption for the amount of steel used in mounting structures, if based on cold rolled coil. For very strong wind conditions, one can assume 50 MT/MW at the high end of the spectrum. If based on hot rolled coil, the weight of the structure might be slightly higher. Price of hot or cold rolled coil as raw material for the c-channel may be assumed to be Rs. 41,500/ton on average, with an additional cost for galvanization and channel preparation. Price of finished structure is assumed to be around Rs.60,000-70,000/ton. Thus, the cost of mounting structures, assuming 50 tons/ MW, is determined to be Rs.35 lakhs/MW. The Commission has therefore retained the cost of mounting structures at Rs.35 lakhs/MW. SOLAR POWER 30 energética INDIA · MAY | JUN16


energetica-india-57_asiapowerweek
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