1 / 20

Briefing on The Procedure & Principles of Awarding Distribution Tariffs

Briefing on The Procedure & Principles of Awarding Distribution Tariffs. NATIONAL ELECTRIC POWER REGULATORY AUTHORY (NEPRA). Restructuring of WAPDA. TRANSFORMING THESE ORGANIZATIONAL COMPONENTS INTO INDEPENDENT CORPORATISED ENTITIES. N T D C 1. POWER WING. GENCOs 5. DISCOs 12.

eamy
Télécharger la présentation

Briefing on The Procedure & Principles of Awarding Distribution Tariffs

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Briefing on The Procedure & Principles of Awarding Distribution Tariffs NATIONAL ELECTRIC POWER REGULATORY AUTHORY (NEPRA)

  2. Restructuring of WAPDA TRANSFORMING THESE ORGANIZATIONAL COMPONENTS INTO INDEPENDENT CORPORATISED ENTITIES N T D C 1 POWER WING GENCOs 5 DISCOs 12 One Hydel Four Thermal TRANSMISSION GENERATION DISTRIBUTION Thermal PowerStations Grid Station / Trans. Lines Operation & Maintenance Area Electricity Boards 2

  3. Chain of Cost Components Fuel Suppliers Refineries/ Gas Cos. Generation Cost Public Sector GENCOs Thermal / Hydel / Nuclear Private Sector IPPs Transmission / CPPA Trans. Cost & Loss Adj. LESCO GEPCO MEPCO IESCO FESCO PESCO HESCO QESCO KESC Dist. Cost & Loss Adj. CONSUMERS Residential/ Commercial/ Industrial/ Agriculture/ Others

  4. Transfer Price Mechanism The generation cost is transferred to the DISCOs according to the Transfer Price Mechanism (TPM) as prescribed by the Authority. NTDC shall charge the DISCOs formed consequent to the unbundling of WAPDA (termed as XWDISCOs) and KESC, a transfer charge for procuring power from approved generating companies (termed as CPGENCOs) and its delivery to DISCOs for a billing period as under: XTC = XCTC + XETC Where: XTC = Transfer charge to XWDISCOs & KESC XCTC = Capacity Transfer Charge to XWDISCOs & KESC XETC = Energy Transfer Charge to XWDISCOs & KESC XCTC = CpGenCap + USCF XWD 4

  5. Transfer Price Mechanism…continued Where: (i) CPGenCap = the summation of the capacity cost in respect of all CPGencos in Rs for a billing period minus the amount of liquidated damages received during the month. (ii) XWD = the sum of the maximum demand of the XWDISCOs & KESC in kW recorded during a billing period at all the delivery metering points at which power is received by the XWDISCOs & KESC. (iii) USCF = the fixed charge part of the use of system charges in Rs per kW per month. XETC = CpGenE (Rs) XWUs (kWh) 5

  6. Transfer Price Mechanism Where: CPGenE = the summation of the variable charge rate (Rs per kWh) approved for each of the CPGenCOs times the energy in kWh procured from the respective CPGENCO during the billing period. (ii) XWUs = the summation of the energy units (kWh) recorded at the delivery metering point of all the XWDISCOs & KESC during a billing period. 6

  7. COMPONENTS OF DETERMINATION OF TARIFF FOR GENERATION PROJECT Energy Charge - Fuel - Variable O&M Capacity Charge - Fixed O&M - Local - Foreign - Return on Equity - Return on Equity during Construction - Insurance - Withholding Tax - Debt Repayment - Principal Amount - Interest Payment

  8. TYPICAL COMPOSITION OF TARIFF Energy Purchase Price (EPP) = + 8

  9. TARIFF DETERMINATION PROCEDURES • The Company/ Licensee files a petition for determination of its tariff according to NEPRA Tariff Standard Procedure Rules -1998; • The Authority on the basis of information decides whether prima facie case exists for admission of the tariff petition; • In case Authority admits the petition for consideration it gives notice to all the stakeholders through advertisement in the national newspapers inviting them for intervention to participate in the tariff proceedings through personal participation or through written comments;

  10. After public hearing, based on the evidence provided by the petitioner and the stakeholders, the Authority after due diligence determines the tariff and recommends to the Federal Government for notification in the official gazette; Generation and Transmission Tariff are determined on cost plus basis. TARIFF DETERMINATION PROCEDURES

  11. Tariffs to be determined, modified or revised, interalia, on the basis of Procedures prescribed under Rule 17(3) of the NEPRA Tariff Standards & Procedure Rules, 1998. tariffs should allow licensees the recovery of any and all costs prudently incurred to meet the demonstrated needs of their customers tariffs should reflect marginal cost principles to the extent feasible, keeping in view the financial stability of the sector the tariff regime should clearly identify inter-class and inter-region subsidies PRINCIPLES OF TARIFF DETERMINATION 11

  12. tariffs should, to the extent feasible, reflect the full cost of service to consumer groups with similar service requirements; tariffs should take into account Government subsidies or the need for adjustment to finance rural electrification in accordance with the policies of the Government; PRINCIPLES OF TARIFF DETERMINATION 12

  13. tariffs may be set below the level of cost of providing the service to consumers consuming electric power below the consumption levels determined for the purpose from time to time by the Authority, as long as such tariffs are financially sustainable; tariffs should seek to provide stability and predict-ability for customers; and tariffs should be comprehensible, free of misinterpretation and shall state explicitly each component thereof. PRINCIPLES OF TARIFF DETERMINATION 13

  14. The tariff so determined is forwarded to the Federal Government pursuant to the Section 31(4) of the NEPRA Act for notification in the Official Gazette. Federal Government in pursuant to Section 31(4) of NEPRA Act read with Rule 16(12) of Tariff Rules – 1998 may file reconsideration request with reference to determination / decision of the Authority. Whereupon the Authority within 15 days shall decide upon the matter and intimated to the Federal Government for Notification in the official gazette. NOTIFICATION OF DETERMINED TARIFFS 14

  15. Power Purchase Price Return on Rate Base (Return on Assets) Depreciation Other income PYA Distribution Margin O&M Salaries, wages and other benefits Repair & Maintenance Traveling Allowance Vehicle maintenance Other/miscellaneous expenses COMPONENTS OF DETERMINATION OFTARIFF FOR DISTRIBUTION COMPANIES 15 Back

  16. Reasons for Different Consumer-End Tariff for Different DISCOs The tariff of all the Distribution Companies (DISCOs) cannot be the same due to following reasons: • Different consumer-mix • Different transmission and distribution losses • Pilferage/theft • Network constraints (old/obsolete networks) • Law & Order situation

  17. FUEL CHARGES ADJUSTMENT MECHANISM • As per Regulation of Generation, Transmission and Distribution of Electric Power (Amendment) Act, 2011: “…the Authority may, on a monthly basis and not later than a period of seven days, make adjustment in the approved tariff on account of any variation in the fuel charges and policy guidelines as the Federal Government may issue and, notify the tariff so adjusted in the official gazette.” • NEPRA, while determining monthly FCA, does not consider any other electricity cost factors and makes the adjustment strictly to the extent of variation in fuel price and energy mix. • FCA is determined by the Authority for every month separately and it does not have cumulative effect on subsequent months tariff.

  18. THANK YOU.

More Related