Investor Presentaiton
Reg Return Assets - Tariff Determination (Karcham Wangtoo)
Operating and
Maintenance expenditure
O&M expenditure is as per contracts with our providers and is fixed @2% p.a. of the project cost with escalation with
escalation at annual intervals based on CPI & WPI annual escalation factor
Depreciation on assets
Depreciation on assets is available @5.18% for the first 12 years of operation and balance value of the assets upto the 90% of
the assets value is depreciated life being charged across the period of the remaining PPA
Interest on Term Loan /
Working Capital Loan
Interest on permitted debt is also added to the costs to arrive at the Annual Revenue Requirement
Further, any savings in interest cost on refinancing up to normative debt accrue 50% to us
Return on Equity and tax on
Return on Equity
16.5% of the equity investment is added to the above costs to arrive at the ARR. Further, this prescribed rate is post tax.
Accordingly, the tax on return on equity is also added
Annual Revenue Requirement
Fixed Charge
50% is payable as fixed amount
on monthly basis
Variable Charge
50% is payable as variable
charge on a per unit basis the
minimum design energy
Incentive: Any increase in availability of plant beyond normative availability is eligible for incentive through pro rata
increase in fixed charge payable recovered on a monthly basis
Incentive:
Any Secondary Energy, energy produced in excess of design energy is eligible for incentive and is billed at
Rs. 1.20 per kwh
Design energy - Minimum energy threshold required to be produced by plant. If any year Design Energy is not met due to lower flow of water in
the river, the shortfall amount is recovered in the next year.
JSW Energy
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