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AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
  • Shri S.K Niranjan, PGCIL
  • None
  • Shri S.S Raju, PGCIL
  • Shri Mohd. Mohsin, PGCIL
  • Shri Avinash M Pavgi, PGCIL
  • Shri Piyush Awasthi, PGCIL
  • Shri Rakesh Prasad, PGCIL
  • Shri M.M Mondal, PGCIL
  • Shri S.K Venkatesan, PGCIL
Judges
  • A.S Bakshi
  • Member
  • Member
  • M.K Iyer
Acts
  • (%) 20.961 20.961 20.961 20.961 20.961 Rate of Return on Equity (%) 19.610 19.610 19.610 19.610 19.610 Return on Equity 176.23 176.23 176.23 176.23 176.23Interest on Loan (IoL)37. Clause 5 and Clause 6 of Regulation 26 of the 2014 Tariff Regulations
  • (%) 9.4024 9.4027 9.4031 9.4037 9.4046 Interest on Loan 107.25 92.31 77.36 62.42 47.48Depreciation39. Clause (2), (5) and (6) of Regulation 27 of the 2014 Tariff Regulations provide that:27. Depreciation:(2)
  • Equity (ROE)35. Clause (1) and (2) of Regulations 24 and Clause (2) of Regulation 25 of the 2014 Tariff Regulations
  • Capital (IWC)43. Clause 1 (c) of Regulation 28 and Clause 5 of Regulation 3 of the 2014 Tariff Regulations
  • 2009-14 TARIFF PERIOD:7. Clause (3) of the Regulation 6 of the 2009 Tariff Regulations
  • Equity33. Clause (1) and (3) of Regulation 19 of the 2014 Tariff Regulations
  • Expenses)26. Clause (g) of Regulation 19 of the 2009 Tariff Regulations
  • SECTION 64 ELECTRICITY ACT 2003
  • INCOME TAX ACT 1961
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
  • Shri S.K Niranjan, PGCIL
  • None
  • Shri S.S Raju, PGCIL
  • Shri Mohd. Mohsin, PGCIL
  • Shri Avinash M Pavgi, PGCIL
  • Shri Piyush Awasthi, PGCIL
  • Shri Rakesh Prasad, PGCIL
  • Shri M.M Mondal, PGCIL
  • Shri S.K Venkatesan, PGCIL
Judges
  • A.S Bakshi
  • Member
  • Member
  • M.K Iyer
Acts
  • (%) 20.961 20.961 20.961 20.961 20.961 Rate of Return on Equity (%) 19.610 19.610 19.610 19.610 19.610 Return on Equity 176.23 176.23 176.23 176.23 176.23Interest on Loan (IoL)37. Clause 5 and Clause 6 of Regulation 26 of the 2014 Tariff Regulations
  • (%) 9.4024 9.4027 9.4031 9.4037 9.4046 Interest on Loan 107.25 92.31 77.36 62.42 47.48Depreciation39. Clause (2), (5) and (6) of Regulation 27 of the 2014 Tariff Regulations provide that:27. Depreciation:(2)
  • Equity (ROE)35. Clause (1) and (2) of Regulations 24 and Clause (2) of Regulation 25 of the 2014 Tariff Regulations
  • Capital (IWC)43. Clause 1 (c) of Regulation 28 and Clause 5 of Regulation 3 of the 2014 Tariff Regulations
  • 2009-14 TARIFF PERIOD:7. Clause (3) of the Regulation 6 of the 2009 Tariff Regulations
  • Equity33. Clause (1) and (3) of Regulation 19 of the 2014 Tariff Regulations
  • Expenses)26. Clause (g) of Regulation 19 of the 2009 Tariff Regulations
  • SECTION 64 ELECTRICITY ACT 2003
  • INCOME TAX ACT 1961
See more information ...
Smart Summary

Factual and Procedural Background

The petition was preferred by Power Grid Corporation of India Limited (the petitioner), a transmission licensee, seeking revision/truing-up of tariff under Regulation 6 of the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2009 ("2009 Tariff Regulations") for the period 1.4.2009 to 31.3.2014 and determination of tariff under the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2014 ("2014 Tariff Regulations") for the period 1.4.2014 to 31.3.2019. The petition concerned two transmission assets (referred to in the order as Asset‑I and Asset‑II) that form part of WRSS‑I Transmission system in the Western Region.

Procedurally, the petition was filed on 4.9.2014 and served on the respondents (distribution licensees / beneficiaries). Notice was published under Section 64 of the Electricity Act, 2003; no public objections were received and the respondents made no submissions. A hearing was held on 21.12.2015, during which the Commission directed the petitioner to furnish additional information concerning additional capital expenditure for 2009‑14 and 2014‑19. The petitioner filed replies by affidavit dated 28.12.2015. The Commission then proceeded to adjudicate and dispose of the petition (the final line of the order states that the order disposes Petition No. 371.TT/2014).

Legal Issues Presented

  1. Whether and to what extent the petitioner's annual fixed charges for the 2009‑14 tariff period should be trued up under Regulation 6 of the 2009 Tariff Regulations based on audited additional capital expenditure, loan and equity details and actual tax and interest rates.
  2. Whether the opening capital cost as on 1.4.2014 and other parameters for the 2014‑19 tariff period should be determined under Regulation 9 and related provisions of the 2014 Tariff Regulations, and whether any additional capitalisation for 2014‑19 is claimable.
  3. How to treat additional capital expenditure incurred during 2009‑14 (admissibility, financing by debt:equity, and supporting Auditor's Certificate) for the purpose of truing up.
  4. Appropriate treatment and grossing up of Return on Equity (ROE) with Minimum Alternate Tax (MAT) or effective tax rate for the relevant years under the 2009 and 2014 Tariff Regulations.
  5. Methodology for computing Interest on Loan (IoL) and weighted average interest rates (including treatment of floating rates) for both tariff periods.
  6. Calculation of depreciation, Interest on Working Capital (IWC), and O&M expenses in accordance with the applicable regulations for each tariff period.
  7. Entitlement to recover deferred tax liability (pre‑1.4.2009), filing and publication fees, licence fee, RLDC fees and charges, and the petitioner's prayer for future reimbursement of service tax.
  8. Whether billing, collection and disbursement of approved transmission charges should follow the CERC Sharing Regulations, 2010 as provided under the 2014 Tariff Regulations.

Arguments of the Parties

Petitioner's Arguments

  • Petitioner sought truing up for 2009‑14 and determination for 2014‑19 for Asset‑I and Asset‑II under the relevant regulations (2009 and 2014 Tariff Regulations respectively).
  • Claimed opening capital costs as on 31.3.2009 of Rs. 20,170.36 lakh (Asset‑I) and Rs. 2,867.59 lakh (Asset‑II) and additional capital expenditure of Rs. 727.59 lakh incurred during 2009‑12 (Rs. 597.23 lakh for Asset‑I and Rs. 130.36 lakh for Asset‑II), supported by an Auditor's Certificate dated 11.9.2014.
  • Confirmed by affidavit dated 28.12.2015 that there were no undischarged liabilities to be recovered in future in respect of the transmission assets covered in the petition.
  • Submitted actual loan portfolios and claimed weighted average rates of interest for calculation of Interest on Loan; provided Annexure details for 2009‑14 and 2014‑19 loan schedules and rates.
  • Claimed ROE after grossing up for MAT as applicable each year; provided the MAT rates used for 2009‑14 and indicated MAT applicability for the company in 2014‑19.
  • For 2014‑19, claimed no additional capital expenditure and computed O&M, IWC and other components using the 2014 Tariff Regulations norms and SBI base rate + 350 bps for IWC (resulting in 13.50%).
  • Prayed for reimbursement of filing fee and publication expenses, licence fee and RLDC fees and charges, and sought leave to claim future service tax reimbursement if liability arises.

Respondents' Arguments

No submissions have been made by the respondents in the record of the provided opinion.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Order dated 19.4.2010 in Petition No. 168/2009 Approval of annual transmission charges up to 31.3.2009 on the basis of admitted capital cost (used as historical admitted cost). The Commission relied on the admitted capital cost figures approved by that order as the basis for opening capital cost for truing up (the admitted capital cost as on 31.3.2009 was considered as opening capital cost on 1.4.2009).
Order dated 23.3.2011 in Petition No. 187/2010 Clubbed Asset‑I and Asset‑IA as Asset‑I and approved capital cost as on 31.3.2009; provided tariff determination baseline for the assets. The Commission used the admitted capital cost, the debt:equity ratio (70:30) and the COD dates as recorded in that order as the starting point for the truing up and for determination of tariff for 2009‑14.
Order dated 8.6.2011 in Petition No. 238/2010 Held that where interest rates are on floating basis, changes in interest rates during the tariff period would be considered at the time of truing up. The Commission applied that principle to allow Interest on Loan based on the weighted average actual rates and to note that any floating rate changes during the tariff period will be accounted for at truing up.

Court's Reasoning and Analysis

The Commission proceeded step‑by‑step, applying the relevant provisions of the 2009 Tariff Regulations for the truing up of 2009‑14 and the 2014 Tariff Regulations for determination of 2014‑19. The analysis relied on the petitioner's audited submissions, prior admitted figures, and regulatory formulae. Key elements of the reasoning are summarized below, following the order's structure:

  1. Opening capital cost: The Commission treated the capital costs admitted by it as on 31.3.2009 (Rs. 20,170.36 lakh for Asset‑I and Rs. 2,867.59 lakh for Asset‑II, per the 23.3.2011 order) as the opening capital cost on 1.4.2009 for the purpose of truing up in line with the proviso to Regulation 7(2) of the 2009 Tariff Regulations.
  2. Additional capital expenditure (2009‑14): The petitioner claimed actual additional capital expenditure of Rs. 727.59 lakh for 2009‑12 (split between Asset‑I and Asset‑II). The petitioner produced an Auditor's Certificate dated 11.9.2014 and an affidavit confirming no remaining undischarged liabilities. The Commission examined these submissions, found the additional expenditure to be within the original scope of work and within approved expenditure (noting only a minor increase in Asset‑I), and allowed the claimed additional capital expenditure in accordance with Regulation 6 of the 2009 Tariff Regulations.
  3. Financing (Debt:Equity): The Commission applied Regulation 12 of the 2009 Tariff Regulations and accepted the normative debt:equity ratio of 70:30 for the admitted capital cost as on 31.3.2009 and for the additional capitalization, taking the petitioner's confirmation that actual equity infused for additional capex was not less than 30%.
  4. ROE and tax grossing up: For 2009‑14, the Commission applied Regulation 15 of the 2009 Tariff Regulations (and its methodology to gross up the base ROE with applicable MAT/Corporate Tax rates). The Commission accepted the petitioner's year‑wise MAT rates and allowed ROE after grossing up accordingly; differences from the earlier approved ROE were attributed to actual MAT rates.
  5. Interest on Loan (IoL): The Commission followed Regulation 16 (2009 Regulations) and Regulation 26 (2014 Regulations) for calculating IoL. It used the weighted average interest rates based on the petitioner's actual loan portfolio (details provided in Annexures) and accepted the petitioner's calculations, noting that for floating rate loans any change in rates during the tariff period would be accounted for at truing up (relying on the precedent from its 8.6.2011 order).
  6. Depreciation: Depreciation was computed under Regulation 17 (2009) for the truing up and Regulation 27 (2014) for the 2014‑19 period, using the admitted capital cost, applicable rates and remaining useful life. The Commission allowed depreciation figures worked out as per the regulations; observed differences from previously approved amounts were due to changes in gross block during the period.
  7. Interest on Working Capital (IWC): IWC was determined in accordance with Regulation 18 (2009) and Regulation 28 (2014). For 2014‑19 the Commission accepted the petitioner's use of SBI Base Rate + 350 bps (13.50%) as on 1.4.2014 for calculating IWC; for 2009‑14 the IWC varied on account of changes in receivables due to MAT rate changes and additional capex.
  8. Operation & Maintenance (O&M) Expenses: O&M norms prescribed in Regulation 19 (2009) and Regulation 29 (2014) were applied. The Commission treated O&M as normative (not subject to truing up) and computed allowable O&M expenses based on the applicable norms. The petitioner's point about prospective wage revision was noted; the Commission clarified that any future application for revision of O&M norms would be considered under the 2014 Tariff Regulations.
  9. Determination for 2014‑19: The Commission considered the capital costs as on 31.3.2014 (Rs. 20,767.59 lakh for Asset‑I and Rs. 2,997.95 lakh for Asset‑II) as opening capital cost on 1.4.2014 under Regulation 9 of the 2014 Tariff Regulations. No additional capitalisation for 2014‑19 was claimed by the petitioner. The Commission applied the 2014 Regulations to compute ROE, IoL, depreciation, IWC and O&M for the 2014‑19 block as set out in the order.
  10. Other claims and regulatory entitlements: The Commission addressed the petitioner's claims for recovery of deferred tax liability (pre‑1.4.2009) and held that deferred tax liability shall be dealt with as per Regulation 49 of the 2014 Tariff Regulations and the petitioner is entitled to recover such liability from beneficiaries or long term customers when materialized. The Commission allowed reimbursement of filing fee and publication expenses for the present petition in accordance with Regulation 52(1) of the 2014 Tariff Regulations, and allowed recovery of licence fee and RLDC fees and charges as per Regulations 52(2)(b) and 52(2)(a) respectively. The petitioner's prayer for future reimbursement of service tax was held to be premature.

Holding and Implications

Holding: The petition (Petition No. 371.TT/2014) is disposed of after truing up the annual fixed charges for the 2009‑14 tariff period and determining the tariff for the 2014‑19 tariff period in accordance with the 2009 and 2014 Tariff Regulations respectively.

The direct effects and specific outcomes on the parties (as explicitly stated in the order) are:

  • The Commission accepted the admitted opening capital costs as on 31.3.2009 and as on 31.3.2014 for the respective tariff periods and allowed the petitioner's claimed additional capital expenditure of Rs. 727.59 lakh for 2009‑12 after prudence check and on the basis of the Auditor's Certificate.
  • The normative debt:equity ratio of 70:30 was applied for admitted capital cost and for additional capitalisation; the petitioner had confirmed that actual equity infusion for additional capex was not less than 30%.
  • ROE was allowed after grossing up with the MAT rates applicable to the petitioner for the relevant years; differences from prior approvals were explained by actual MAT variations.
  • Interest on Loan was allowed based on weighted average actual interest rates and actual loan portfolios submitted by the petitioner; floating rate changes would be considered at truing up.
  • Depreciation, IWC and O&M were computed and allowed in accordance with the applicable regulations and norms; O&M norms were not trued up and any future wage revisions to be addressed through separate applications as per the 2014 Tariff Regulations.
  • The petitioner is entitled to recover deferred tax liability up to 31.3.2009 from beneficiaries/long term customers when the liability materializes, in accordance with Regulation 49 of the 2014 Tariff Regulations.
  • The petitioner is entitled to reimbursement of filing fee and publication expenses related to this petition on a pro‑rata basis from beneficiaries (Regulation 52(1)), and is entitled to recover licence fee and RLDC fees/charges for 2014‑19 as per Regulations 52(2)(b) and 52(2)(a).
  • The petitioner's prayer for reimbursement of service tax in future was considered premature and not allowed at this stage.

Implications for precedent and broader regulatory practice: The order applies existing regulatory provisions and prior Commission orders to the facts at hand; it does not assert any new legal doctrine beyond the application of the cited tariff regulations and earlier Commission decisions. The order thus effects a factual and regulatory application (truing up and tariff determination) for the petitioner and the beneficiaries named, without creating a new precedent outside the established regulatory framework.

This summary is prepared exclusively from the contents of the provided opinion and does not introduce information not present in the source text.

Show full summary ...

    Power Grid Corporation Of India Ltd. v. Madhya Pradesh Power Management Company Ltd.

    1. The petition has been preferred by Power Grid Corporation of India Limited (hereinafter referred to as “the petitioner”), a transmission licensee, for revision of tariff under Regulation 6 of the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2009 (hereinafter referred to as “the 2009 Tariff Regulations”) based on truing up of capital expenditure for the period 1.4.2009 to 31.3.2014 and for determination of tariff under Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2014 (hereinafter referred to as “the 2014 Tariff Regulations”) for the period from 1.4.2014 to 31.3.2019 in respect of 40% FSC compensation package for 400 kV D/C Khandwa-Seoni Transmission Line at Khandwa station (Asset-I) combined with 400 kV D/C Sipat Raipur Transmission line along with sub-station bays at Raipur and Sipat (Asset-IA) (hereinafter referred to as “Asset-I”) and 315 MVA, 400/220 kV ICT with associated 220 kV bays associated with Itarsi (PG)-Itarsi (MPPTCL) Ckt-II and 220 kV bays associated with Itarsi (PG)-Bhopal (MPPTCL) Ckt-II (referred as “Asset-II”) under WRSS-I Transmission system in Western Region (hereinafter referred to as “the transmission assets”).

    2. The respondents are the distribution licensees, who are procuring transmission service from the petitioner, mainly the beneficiaries of Western Region.

    3. The brief facts of the case are as follows:—

    a) Investment approval for the transmission scheme was accorded by the Board of Directors of the petitioner company vide its letter dated 12.8.2004 at an estimated cost of Rs. 19921 lakh, which included IDC of Rs. 1085 lakh at the 1st quarter 2004 price level. Subsequently, the Board of Directors vide its Memorandum dated 26.12.2006 accorded approved for revised cost estimate of Rs. 23800 lakh, including IDC of Rs. 1732 lakh at the 3rd quarter 2008 price level.

    2004-09 tariff period

    b) The annual transmission charges up to 31.3.2009 in respect of the transmission scheme were approved vide order dated 19.4.2010 in Petition No. 168/2009 based on admitted capital cost of Rs. 20170.36 lakh for Asset-I and Asset-IA and Rs. 2867.59 lakh for Asset-II.

    2009-14 tariff period

    c) The Commission, in the order dated 23.3.2011, had clubbed Asset-I and Asset-IA as Asset-I with the date of commercial operation considered for determination of transmission charges as 1.8.2008 In the above order dated 23.3.2011, transmission tariff was determined by clubbing the elements as under:—

    (i) Asset-I: 40% FSC Compensation package for 400 kV D/C Khandwa Seoni Transmission Line at Khandwa Station and 400 kV Sipat Raipur Transmission Line along with sub-station bays at Raipur and Sipat, COD 1.8.2008

    (ii) Asset-II: 315 MVA, 400/220 kV ICT with associated 220 kV bays associated with Itarsi (PG) MPPTCL Ckt-II and 220 kV bays associated with Itarsi (PG) - Bhopal (MPPTCL) Ckt-II, COD 1.5.2008

    d) The Commission vide its order dated 23.3.2011 in Petition No. 187/2010 had approved the capital cost of the transmission assets as on 31.3.2009 as under:—

    Asset-I Admitted as on 31.3.2009 Amount (Rs. in lakh) Percentage (%) Debt 14119.97 70.00 Equity 6050.39 30.00 Capital Cost 20170.36 100.00 Asset-II Admitted as on 31.3.2009 Amount (Rs. in lakh) Percentage (%) Debt 2008.05 70.00 Equity 859.54 30.00 Capital Cost 2867.59 100.00

    e) The Commission had also allowed estimated additional capital cost amounting to Rs. 586.54 lakh and Rs. 175.31 lakh in respect to Asset-I and Asset-II respectively towards balance and retention payments during 2009-11 for determination of tariff for 2009-14 tariff period.

    f) The Commission determined the tariff for the transmission assets for tariff period 2009-14, based on admitted capital cost of Rs. 20170.36 lakh and Rs. 2867.59 lakh as on 31.3.2009 and estimated additional capital expenditure of Rs. 586.54 lakh and Rs. 175.31 lakh in respect of Asset-I and Asset-II respectively during 2009-11 as given below:—

    (Rs. in lakh)

    Asset-I Particulars 2009-10 2010-11 2011-12 2012-13 2013-14 Depreciation 1080.45 1095.93 1096.61 1096.61 1096.61 Interest on Loan 1255.12 1171.78 1070.11 966.78 863.58 Return on Equity 1072.38 1087.76 1088.43 1088.43 1088.43 Interest on Working Capital 91.43 91.51 90.65 89.80 89.03 O & M Expenses 407.90 431.27 455.95 482.02 509.52 Total 3907.28 3878.24 3801.75 3723.64 3647.16
    Asset-II Particulars 2009-10 2010-11 2011-12 2012-13 2013-14 Depreciation 153.74 158.37 161.32 161.32 161.32 Interest on Loan 175.67 166.69 155.37 140.16 124.97 Return on Equity 151.92 156.52 159.45 159.45 159.45 Interest on Working Capital 18.16 18.63 19.01 19.21 19.44 O & M Expenses 162.44 171.74 181.57 191.94 202.92 Total 661.93 671.95 676.72 672.08 668.10

    4. As per Regulation 6 of the 2009 Tariff Regulations, the Commission shall carry out truing up exercise along with the tariff petition filed for the next tariff period, with respect to the capital expenditure including additional capital expenditure incurred up to 31.3.2014, as admitted by the Commission after prudence check at the time of truing up. Further, as per Regulation 15 of the 2009 Tariff Regulations, the petitioner is required to adjust the yearly impact of MAT rate in the truing up petition for 2009-14 tariff period.

    5. In this context, the petitioner has filed the instant petition on 4.9.2014, for revision of tariff for the tariff period 2009-14 in accordance with Regulation 6 of the 2009 Tariff Regulations.

    6. The petitioner has served the petition to the respondents and notice of this application has been published in the newspaper in accordance with Section 64 of the Electricity Act, 2003 (“the Act”). No comments/objections have been received from the public in response to the notice in newspaper. No submissions have been made by the respondents. The hearing in this matter was held on 21.12.2015 During the hearing the Commission had directed the petitioner to submit additional information in respect of the additional capital expenditure claimed by the petitioner for 2009-14 tariff period and 2014-19 tariff period. In response to the Commission's directions the petitioner has submitted its replies vide affidavit dated 28.12.2015 Having heard the representatives of the petitioner and perused the material on record, we proceed to dispose of the petition.

    TRUING UP OF ANNUAL FIXED CHARGES FOR 2009-14 TARIFF PERIOD:—

    7. Clause (3) of the Regulation 6 of the 2009 Tariff Regulations provides as under:—

    “(3) The generating company or the transmission licensee, as the case may be, shall submit for the purpose of truing up, details of capital expenditure and additional capital expenditure incurred for the period from 1.4.2009 to 31.3.2014, duly audited and certified by the auditors”.

    8. The petitioner has submitted the information as required under the 2009 Tariff Regulations for truing up of annual fixed charges for 2009-14 tariff period. The tariff for 2009-14 tariff period has been trued up in the subsequent paragraphs.

    Capital Cost

    9. The petitioner has claimed capital cost of Rs. 20170.36 lakh and Rs. 2867.59 lakh as on 31.3.2009 in respect of Asset-I and Asset-II respectively for the purpose of tariff determination.

    10. The last proviso to Regulation 7(2) of the 2009 Tariff Regulations provides that:—

    “Provided also that in case of the existing projects, the capital cost admitted by the Commission prior to 1.4.2009 duly trued up by excluding un-discharged liability, if any, as on 1.4.2009 and the additional capital expenditure projected to be incurred for the respective year of the tariff period 2009-14, as may be admitted by the Commission, shall form the basis for determination of tariff”.

    11. The capital cost of Rs. 20170.36 lakh and Rs. 2867.59 lakh as on 31.3.2009 in respect of Asset-I and Asset-II respectively admitted by the Commission as on 31.3.2009 has been considered as opening capital cost as on 1.4.2009 for determination of trued up tariff in accordance with Regulation 7 of the 2009 Tariff Regulations.

    Additional Capital Expenditure

    12. Regulation 6(1) of the 2009 Regulations provides that:—

    “The Commission shall carry out truing up exercise along with the tariff petition filed for the next tariff period, with respect to the capital expenditure including additional capital expenditure incurred up to 31.3.2014”

    13. The petitioner has submitted that it has incurred an additional capital expenditure of Rs. 727.59 lakh (Rs. 597.23 lakh and Rs. 130.36 lakh) during 2009-12 towards final payment of un-discharged liabilities as depicted below:—

    (Rs. in lakh)

    Name of Assets Apportioned approved cost Admitted cost as on 31.3.2009 Additional capital expenditure Total capital expenditure 2009-10 2010-11 2011-12 Total Asset-I 20809.38 20170.36 559.85 28.12 9.26 597.23 20767.59 Asset-II 2990.42 2867.59 130.36 0.00 0.00 130.36 2997.95 Total 23799.80 23037.95 690.21 28.12 9.26 727.59 23765.54

    14. The petitioner has further confirmed vide its affidavit dated 28.12.2015 that there are no undischarged liabilities to be recovered in future in respect of the transmission assets covered in the present petition. The petitioner has also submitted the Auditor's Certificate dated 11.9.2014 certifying the actual capital cost.

    15. We have considered the submissions of the petitioner with regard to the actual capital expenditure during 2009-12. The capital expenditure of Rs. 727.59 lakh is based on actual additional capital expenditure incurred as per the Auditor's Certificate dated 11.9.2014, and is within the original scope of work and the total capital expenditure is within the total approved capital expenditure, except a minor increase in case of Asset-I. Thus, the same is allowed for the purpose of revision of tariff in accordance with Regulation 6 of the 2009 Tariff Regulations.

    16. The debt:equity ratio of 70:30 for additional capital expenditure as claimed by the petitioner is in accordance with the Regulation 12(3) of the 2009 Tariff Regulations and hence, same has been considered towards financing of the additional capital expenditure.

    Debt: Equity

    16. Regulation 12 of the 2009 Tariff Regulations provides as under:—

    “12. Debt-Equity Ratio. (1) For a project declared under commercial operation on or after 1.4.2009, if the equity actually deployed is more than 30% of the capital cost, equity in excess of 30% shall be treated as normative loan:

    Provided that where equity actually deployed is less than 30% of the capital cost, the actual equity shall be considered for determination of tariff:

    (2) In case of the generating station and the transmission system declared under commercial operation prior to 1.4.2009, debt-equity ratio allowed by the Commission for determination of tariff for the period ending 31.3.2009 shall be considered.

    (3) Any expenditure incurred or projected to be incurred on or after 1.4.2009 as may be admitted by the Commission as additional capital expenditure for determination of tariff, and renovation and modernisation expenditure for life extension shall be serviced in the manner specified in clause (1) of this regulation.”

    17. In response to the query, the petitioner has confirmed vide its affidavit dated 28.12.2015 that the actual equity infused in respect of the additional capital expenditure during the 2009-14 tariff period is not less than 30% for the instant transmission assets. The debt:equity ratio of 70:30 admitted by the Commission vide order dated 23.3.2011 in Petition No. 187/2010 as on 31.3.2009 has been considered as on 1.4.2009 for determination of tariff in accordance with the Regulation 12 of the 2009 Tariff Regulations. In respect of the additional capitalization, debt: equity ratio of 70:30 has been considered in line with the 2009 Tariff Regulations.

    18. The details of the debt:equity considered for the purpose of tariff for 2009-14 tariff period is as follows:—

    (Rs. in lakh)

    Asset-I Funding Capital cost as on 31.3.2009 (%) Additional capital expenditure during 2009-14 (%) Total Cost as on 31.3.2014 (%) Debt 14119.97 70.00 418.06 70.00 14538.03 70.00 Equity 6050.39 30.00 179.16 30.00 6229.55 30.00 Total 20170.36 100.00 597.23 100.00 20767.59 100.00 Asset-II Funding Capital cost as on 31.3.2009 (%) Additional capital expenditure during 2009-14 (%) Total Cost as on 31.3.2014 (%) Debt 2008.05 70.00 91.25 70.00 2099.30 70.00 Equity 859.54 30.00 39.11 30.00 898.65 30.00 Total 2867.59 100.00 130.36 100.00 2997.95 100.00

    Return on Equity (ROE)

    19. Clause (3), (4) and (5) of the Regulation 15 of the 2009 Tariff Regulations provide that

    “(3) The rate of return on equity shall be computed by grossing up the base rate with the Minimum Alternate/Corporate Income Tax Rate for the year 2008-09, as per the Income Tax Act, 1961, as applicable to the concerned generating company or the transmission licensee, as the case may be.

    (4) Rate of return on equity shall be rounded off to three decimal points and be computed as per the formula given below:

    Rate of pre-tax return on equity = Base rate/(1-t)

    Where “t” is the applicable tax rate in accordance with clause (3) of this regulation.

    (5) The generating company or the transmission licensee, as the case may be, shall recover the shortfall or refund the excess Annual Fixed Charge on account of Return on Equity due to change in applicable Minimum Alternate/Corporate Income Tax Rate as per the Income Tax Act, 1961 (as amended from time to time) of the respective financial year directly without making any application before the Commission:

    Provided further that Annual Fixed Charge with respect to the tax rate applicable to the generating company or the transmission licensee, as the case may be, in line with the provisions of the relevant Finance Acts of the respective year during the tariff period shall be trued up in accordance with Regulation 6 of these regulations.”

    20. The variation in the tax rate during the 2009-14 tariff period applicable to the petitioner as per the Finance Act of the relevant year for the purpose of grossing up of return on equity (ROE) has been furnished by the petitioner as follows:—

    Year MAT Rate claimed in the current petition Grossed up ROE (Base Rate/(1-t)) claimed in the current petition 2009-10 16.995% 18.674% 2010-11 19.931% 19.358% 2011-12 20.008% 19.377% 2012-13 20.008% 19.377% 2013-14 20.961% 19.610%

    21. The ROE as trued up and allowed is as follows:—

    (Rs. in lakh)

    Asset-I Return on Equity 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 1072.38 1087.76 1088.43 1088.43 1088.43 Claimed by the petitioner 1145.53 1204.56 1206.83 1207.10 1221.62 Allowed after truing up in this order 1145.51 1204.58 1206.83 1207.10 1221.64
    Asset-II Return on Equity 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 151.92 156.52 159.45 159.45 159.45 Claimed by the petitioner 164.16 173.96 174.13 174.13 176.23 Allowed after truing up in this order 164.16 173.96 174.13 174.13 176.23

    The difference in the approved ROE and that allowed after truing up is on account of actual grossed up ROE based on actual MAT rate.

    Interest on Loan (“IoL”)

    22. Regulation 16 of the 2009 Tariff Regulations provide the methodology for working out weighted average rate of IoL. The Commission in its earlier order dated 8.6.2011 in Petition No. 238/2010 has dealt with similar issue and held that:—

    “…in case of floating rate of interest, any change in the rates of interest during the tariff period will be considered at the time of true up”.

    23. The petitioner has submitted the weighted average rate of IoL, based on its actual loan portfolio and rate of interest. Accordingly, the IoL has been calculated based on actual interest rate submitted by the petitioner, in accordance with the Regulation 16 of the 2009 Tariff Regulations. The details of weighted average rate of interest are placed in Annexure-1. The IoL worked out is as follows:—

    (Rs. in lakh)

    Asset-I Interest on Loan 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 1255.12 1171.78 1070.11 966.78 863.58 Claimed by the petitioner 1255.07 1171.72 1070.37 967.29 864.04 Allowed after truing up in this order 1255.07 1171.72 1070.38 967.29 864.04
    Asset-II Interest on Loan 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 175.67 166.69 155.37 140.16 124.97 Claimed by the petitioner 177.69 167.04 152.13 137.15 122.19 Allowed after truing up in this order 177.69 167.04 152.13 137.15 122.19

    The difference in the approved IoL and that allowed after truing up is on account of change in the weighted average rate of interest which is computed based on actual loan portfolio and rate of interest.

    Depreciation

    24. The depreciation has been worked out as per the methodology provided in the Regulation 17 of the 2009 Tariff Regulations. The depreciation allowed is as follows:—

    (Rs. in lakh)

    Asset-I Depreciation 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 1080.45 1095.93 1096.61 1096.61 1096.61 Claimed by the petitioner 1080.42 1095.94 1096.93 1097.18 1097.18 Allowed after truing up in this order 1080.42 1095.94 1096.93 1097.17 1097.17
    Asset-II Depreciation 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 153.74 158.37 161.32 161.32 161.32 Claimed by the petitioner 155.50 158.95 158.95 158.95 158.95 Allowed after truing up in this order 155.51 158.95 158.95 158.95 158.95

    The difference in the approved depreciation and that allowed after truing up is on account of change in gross block during the 2009-14 tariff period.

    Interest on Working Capital (IWC)

    25. The IWC has been worked out as per the methodology provided in the Regulation 18 of the 2009 Tariff Regulations and allowed as under:—

    (Rs. in lakh)

    Asset-I Interest on Working Capital 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 91.43 91.51 90.65 89.80 89.03 Claimed by the petitioner 92.96 93.94 93.13 92.30 91.82 Allowed after truing up in this order 92.95 93.94 93.13 92.30 91.82
    Asset-II Interest on Working Capital 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 18.16 18.63 19.01 19.21 19.44 Claimed by the petitioner 18.49 19.01 19.20 19.40 19.68 Allowed after truing up in this order 18.49 19.01 19.19 19.40 19.68

    The variation in IWC is on account of change in the receivables during the 2009-14 tariff period on account of change in MAT rate and additional capital expenditure.

    Operation & Maintenance Expenses (“O&M Expenses”)

    26. Clause (g) of Regulation 19 of the 2009 Tariff Regulations specifies the norms for O&M Expenses for the transmission system. The normative O&M Expenses are not required to be trued up. Accordingly, the total allowable O&M expenses for the instant assets have been worked out based on norms of O&M Expenses and the details are as follows:—

    (Rs. in lakh)

    Asset-I O&M Expenses 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 407.90 431.27 455.95 482.02 509.52 Claimed by the petitioner 407.90 431.27 455.95 482.02 509.52 Allowed after truing up in this order 407.90 431.27 455.95 482.02 509.52
    Asset-II O&M Expenses 2009-10 2010-11 2011-12 2012-13 2013-14 Approved vide order dated 23.3.2011 162.44 171.74 181.57 191.94 202.92 Claimed by the petitioner 162.44 171.74 181.57 191.94 202.92 Allowed after truing up in this order 162.44 171.74 181.57 191.94 202.92

    APPROVED ANNUAL FIXED CHARGES FOR 2009-14 TARIFF PERIOD

    27. The detailed computation of the various components of the trued up annual fixed charges for the instant transmission assets for the tariff period 2009-14 is summarised below:—

    (Rs. in lakh)

    Asset-I Particulars 2009-10 2010-11 2011-12 2012-13 2013-14 Depreciation Opening Gross Block 20170.36 20730.21 20758.33 20767.59 20767.59 Additional Capitalisation 559.85 28.12 9.26 0.00 0.00 Closing Gross Block 20730.21 20758.33 20767.59 20767.59 20767.59 Average Gross Block 20450.29 20744.27 20762.96 20767.59 20767.59 Rate of Depreciation (%) 5.28 5.28 5.28 5.28 5.28 Depreciable Value 18405.26 18669.84 18686.66 18690.83 18690.83 Balance useful life of the asset 32 31 30 29 28 Elapsed life 0 1 2 3 4 Remaining Depreciable Value 18405.26 17589.43 16510.31 15417.55 14320.37 Depreciation during the year 1080.42 1095.94 1096.93 1097.17 1097.17 Cumulative depreciation (incl. of AAD) 1080.42 2176.36 3273.29 4370.46 5467.63 Interest on Loan Gross Normative Loan 14119.97 14511.87 14531.55 14538.03 14538.03 Cumulative Repayments upto Previous Year 438.97 1519.39 2615.33 3712.26 4809.43 Net Loan-Opening 13681.00 12992.48 11916.22 10825.78 9728.60 Additions 391.90 19.68 6.48 0.00 0.00 Repayment during the year 1080.42 1095.94 1096.93 1097.17 1097.17 Net Loan-Closing 12992.48 11916.22 10825.78 9728.60 8631.43 Average Loan 13336.74 12454.35 11371.00 10277.19 9180.02 Weighted Average Rate of Interest on Loan (%) 9.4106 9.4081 9.4132 9.4120 9.4122 Interest on Loan 1255.07 1171.72 1070.38 967.29 864.04 Return on Equity Opening Equity 6050.39 6218.34 6226.78 6229.55 6229.55 Additions 167.95 8.44 2.78 0.00 0.00 Closing Equity 6218.34 6226.78 6229.55 6229.55 6229.55 Average Equity 6134.37 6222.56 6228.17 6229.55 6229.55
    Asset-I Particulars 2009-10 2010-11 2011-12 2012-13 2013-14 Return on Equity (Base Rate) (%) 15.500 15.500 15.500 15.500 15.500 MAT Rate for respective year (%) 16.995 19.931 20.008 20.008 20.961 Rate of Return on Equity (%) 18.674 19.358 19.377 19.377 19.610 Return on Equity 1145.51 1204.58 1206.83 1207.10 1221.64 Interest on Working Capital O & M Expenses 33.98 35.92 37.98 40.15 42.44 Maintenance Spares 61.18 64.69 68.39 72.30 76.43 Receivables 663.64 666.24 653.87 640.98 630.70 Total Working Capital 758.80 766.86 760.24 753.43 749.57 Rate of Interest (%) 12.25 12.25 12.25 12.25 12.25 Interest of working capital 92.95 93.94 93.13 92.30 91.82 Annual Transmission Charges Depreciation 1080.42 1095.94 1096.93 1097.17 1097.17 Interest on Loan 1255.07 1171.72 1070.38 967.29 864.04 Return on Equity 1145.51 1204.58 1206.83 1207.10 1221.64 Interest on Working Capital 92.95 93.94 93.13 92.30 91.82 O & M Expenses 407.90 431.27 455.95 482.02 509.52 Total 981.84 3997.45 3923.21 3845.87 3784.20
    Asset-II Particulars 2009-10 2010-11 2011-12 2012-13 2013-14 Depreciation Opening Gross Block 2867.59 2997.95 2997.95 2997.95 2997.95 Additional Capitalisation 130.36 0.00 0.00 0.00 0.00 Closing Gross Block 2997.95 2997.95 2997.95 2997.95 2997.95 Average Gross Block 2932.77 2997.95 2997.95 2997.95 2997.95 Rate of Depreciation (%) 5.30 5.30 5.30 5.30 5.30 Depreciable Value 2639.49 2698.16 2698.16 2698.16 2698.16 Balance useful life of the asset 25 24 23 22 21 Elapsed life 0 1 2 3 4 Remaining Depreciable Value 2551.61 2454.77 2295.82 2136.87 1977.92 Depreciation during the year 155.51 158.95 158.95 158.95 158.95 Cumulative depreciation (incl. of AAD) 243.39 402.34 561.29 720.23 879.18 Interest on Loan
    Asset-II Particulars 2009-10 2010-11 2011-12 2012-13 2013-14 Gross Normative Loan 2008.05 2099.30 2099.30 2099.30 2099.30 Cumulative Repayments upto Previous Year 87.88 243.39 402.34 561.29 720.23 Net Loan-Opening 1920.17 1855.91 1696.97 1538.02 1379.07 Additions 91.25 0.00 0.00 0.00 0.00 Repayment during the year 155.51 158.95 158.95 158.95 158.95 Net Loan-Closing 1855.91 1696.97 1538.02 1379.07 1220.12 Average Loan 1888.04 1776.44 1617.49 1458.54 1299.59 Weighted Average Rate of Interest on Loan (%) 9.4114 9.4032 9.4053 9.4030 9.4021 Interest on Loan 177.69 167.04 152.13 137.15 122.19 Return on Equity Opening Equity 859.54 898.65 898.65 898.65 898.65 Additions 39.11 0.00 0.00 0.00 0.00 Closing Equity 898.65 898.65 898.65 898.65 898.65 Average Equity 879.09 898.65 898.65 898.65 898.65 Return on Equity (Base Rate) (%) 15.50 15.50 15.50 15.50 15.50 MAT Rate for respective year (%) 16.995 19.931 20.008 20.008 20.961 Rate of Return on Equity (%) 18.674 19.358 19.377 19.377 19.610 Return on Equity 164.16 173.96 174.13 174.13 176.23 Interest on Working Capital O & M Expenses 13.53 14.31 15.12 15.99 16.90 Maintenance Spares 24.37 25.76 27.24 28.79 30.44 Receivables 113.05 115.12 114.33 113.59 113.33 Total Working Capital 150.95 155.18 156.69 158.37 160.67 Rate of Interest (%) 12.25 12.25 12.25 12.25 12.25 Interest of working capital 18.49 19.01 19.19 19.40 19.68 Annual Transmission Charges Depreciation 155.51 158.95 158.95 158.95 158.95 Interest on Loan 177.69 167.04 152.13 137.15 122.19 Return on Equity 164.16 173.96 174.13 174.13 176.23 Interest on Working Capital 18.49 19.01 19.19 19.40 19.68 O & M Expenses 162.44 171.74 181.57 191.94 202.92 Total 678.29 690.70 685.97 681.57 679.97

    DETERMINATION OF ANNUAL FIXED CHARGES FOR 2014-19 TARIFF PERIOD

    28. The petitioner has claimed the tariff charges for 2014-19 tariff period as under:—

    (Rs. in lakh)

    Asset-I Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Depreciation 1097.18 1097.18 1097.18 1097.18 1097.18 Interest on Loan 760.88 657.71 554.54 451.36 348.17 Return on Equity 1221.62 1221.62 1221.62 1221.62 1221.62 Interest on Working Capital 96.7 95.18 93.69 92.23 90.8 O & M Expenses 467.23 482.81 498.81 515.37 532.45 Total 3643.61 3554.50 3465.84 3377.76 3290.22
    Asset-II Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Depreciation 158.95 158.95 158.95 158.95 158.95 Interest on Loan 107.25 92.31 77.36 62.42 47.48 Return on Equity 176.23 176.23 176.23 176.23 176.23 Interest on Working Capital 20.51 20.51 20.52 20.54 20.58 O & M Expenses 186.93 193.13 199.55 206.16 213.01 Total 649.87 641.13 632.61 624.30 616.25

    29. The details submitted by the petitioner in support of its claim for interest on working capital are given hereunder:—

    (Rs. in lakh)

    Asset-I Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 O & M Expenses 38.94 40.23 41.57 42.95 44.37 Maintenance Spares 70.08 72.42 74.82 77.31 79.87 Receivables 607.27 592.42 577.64 562.96 548.37 Total 716.29 705.07 694.03 683.22 672.61 Rate of Interest (%) 13.50 13.50 13.50 13.50 13.50 Interest 96.70 95.18 93.69 92.23 90.80
    Asset-II Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 O & M Expenses 15.58 16.09 16.63 17.18 17.75 Maintenance Spares 28.04 28.97 29.93 30.92 31.95 Receivables 108.31 106.86 105.44 104.05 102.71 Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Total 151.93 151.92 152.00 152.15 152.41 Rate of Interest (%) 13.50 13.50 13.50 13.50 13.50 Interest 20.51 20.51 20.52 20.54 20.58

    Capital Cost

    30. Clause (3) and (6) of Regulation 9 of 2014 Tariff Regulation provide as follows:—

    “(3) The Capital cost of an existing project shall include the following:

    (a) the capital cost admitted by the Commission prior to 1.4.2014 duly trued up by excluding liability, if any, as on 1.4.2014;

    (b) additional capitalization and de-capitalization for the respective year of tariff as determined in accordance with Regulation 14; and

    (c) expenditure on account of renovation and modernisation as admitted by this Commission in accordance with Regulation 15.”

    “(6) The following shall be excluded or removed from the capital cost of the existing and new project:

    (a) The assets forming part of the project, but not in use; (b) Decapitalisation of Asset;”

    31. The capital cost of Rs. 20767.59 lakh and Rs. 2997.95 lakh worked out by the Commission as on 31.3.2014 in respect of Asset-I and Asset-II respectively have been considered as opening capital cost as on 1.4.2014 for determination of tariff in accordance with Regulation 9 of the 2014 Tariff Regulations.

    Additional Capital Expenditure

    32. The petitioner has not claimed any additional capital expenditure during 2014-19 in respect of the transmission assets.

    Debt: Equity

    33. Clause (1) and (3) of Regulation 19 of the 2014 Tariff Regulations provide as under:—

    “19. Debt-Equity Ratio: (1) For a project declared under commercial operation on or after 1.4.2014, the debt-equity ratio would be considered as 70:30 as on COD. If the equity actually deployed is more than 30% of the capital cost, equity in excess of 30% shall be treated as normative loan:”

    “(3) In case of the generating station and the transmission system including communication system declared under commercial operation prior to 1.4.2014, debt equity ratio allowed by the Commission for determination of tariff for the period ending 31.3.2014 shall be considered.”

    “(5) Any expenditure incurred or projected to be incurred on or after 1.4.2014 as maybe admitted by the Commission as additional capital expenditure for determination of tariff, and renovation and modernisation expenditure for life extension shall be serviced in the manner specified in clause (1) of this regulation.”

    34. The petitioner has considered the debt:equity ratio of 70:30 as on 31.3.2014, which is in line with the 2014 Tariff Regulations.

    Return on Equity (ROE)

    35. Clause (1) and (2) of Regulations 24 and Clause (2) of Regulation 25 of the 2014 Tariff Regulations specify as under:—

    “24. Return on Equity: (1) Return on equity shall be computed in rupee terms, on the equity base determined in accordance with regulation 19.

    (2) Return on equity shall be computed at the base rate of 15.50% for thermal generating stations, transmission system including communication system”

    “25. Tax on Return on Equity:

    (2) Rate of return on equity shall be rounded off to three decimal places and shall be computed as per the formula given below:

    Rate of pre-tax return on equity = Base rate/(1-t)

    Where “t” is the effective tax rate in accordance with Clause (1) of this regulation and shall be calculated at the beginning of every financial year based on the estimated profit and tax to be paid estimated in line with the provisions of the relevant Finance Act applicable for that financial year to the company on pro-rata basis by excluding the income of non-generation or non-transmission business, as the case may be, and the corresponding tax thereon. In case of generating company or transmission licensee paying Minimum Alternate Tax (MAT), “t” shall be considered as MAT rate including surcharge and cess.”

    36. The petitioner has submitted that MAT rate is applicable to the petitioner's Company. Accordingly, the MAT rate applicable during the 2013-14 has been considered for the purpose of ROE, which shall be trued up with actual tax rate in accordance with clause (3) of regulation 25 of the 2014 Tariff Regulations. The ROE has been worked out and allowed as follows:—

    (Rs. in lakh)

    Asset-I Return on Equity 2014-15 2015-16 2016-17 2017-18 2018-19 Opening Equity 6229.55 6229.55 6229.55 6229.55 6229.55 Additions 0.00 0.00 0.00 0.00 0.00 Closing Equity 6229.55 6229.55 6229.55 6229.55 6229.55 Average Equity 6229.55 6229.55 6229.55 6229.55 6229.55 Return on Equity (Base Rate) (%) 15.500 15.500 15.500 15.500 15.500 MAT Rate for respective year (%) 20.961 20.961 20.961 20.961 20.961 Rate of Return on Equity (%) 19.610 19.610 19.610 19.610 19.610 Return on Equity 1221.64 1221.64 1221.64 1221.64 1221.64
    Asset-II Return on Equity 2014-15 2015-16 2016-17 2017-18 2018-19 Opening Equity 898.65 898.65 898.65 898.65 898.65 Additions 0.00 0.00 0.00 0.00 0.00 Closing Equity 898.65 898.65 898.65 898.65 898.65 Average Equity 898.65 898.65 898.65 898.65 898.65 Return on Equity (Base Rate) (%) 15.500 15.500 15.500 15.500 15.500 MAT Rate for respective year (%) 20.961 20.961 20.961 20.961 20.961 Rate of Return on Equity (%) 19.610 19.610 19.610 19.610 19.610 Return on Equity 176.23 176.23 176.23 176.23 176.23

    Interest on Loan (“IoL”)

    37. Clause 5 and Clause 6 of Regulation 26 of the 2014 Tariff Regulations provides that:—

    “(5) The rate of interest shall be the weighted average rate of interest calculated on the basis of the actual loan portfolio after providing appropriate accounting adjustment for interest capitalized:

    Provided that if there is no actual loan for a particular year but normative loan is still outstanding, the last available weighted average rate of interest shall be considered:

    Provided further that if the generating station or the transmission system, as the case may be, does not have actual loan, then the weighted average rate of interest of thegenerating company or the transmission licensee as a whole shall be considered.

    (6) The interest on loan shall be calculated on the normative average loan of the year by applying the weighted average rate of interest.”

    38. The weighted average rate of IoL has been considered on the basis of rate prevailing as on 1.4.2014 The petitioner has prayed that the change in interest rate due to floating rate of interest applicable, if any, during 2014-19 tariff period will be adjusted. Accordingly, the floating rate of interest, if any, shall be considered at the time of true up or next revision of tariff. By considering above, the IoL has been worked out in accordance with Regulation 26 of the 2014 Tariff Regulations. The details of weighted average rate of interest for 2014-19 tariff period are placed in Annexure 2. IoL has been worked out and allowed as follows:—

    (Rs. in lakh)

    Asset-I Interest on Loan 2014-15 2015-16 2016-17 2017-18 2018-19 Gross Normative Loan 14538.03 14538.03 14538.03 14538.03 14538.03 Cumulative Repayment upto Previous Year 5906.60 7003.77 8100.94 9198.11 10295.28 Net Loan-Opening 8631.43 7534.26 6437.09 5339.92 4242.75 Additions 0.00 0.00 0.00 0.00 0.00 Repayment during the year 1097.17 1097.17 1097.17 1097.17 1097.17 Net Loan-Closing 7534.26 6437.09 5339.92 4242.75 3145.57 Average Loan 8082.85 6985.68 5888.50 4791.33 3694.16 Weighted Average Rate of Interest on Loan (%) 9.4135 9.4152 9.4174 9.4205 9.4250 Interest on Loan 760.88 657.72 554.54 451.37 348.17
    Asset-II Interest on Loan 2014-15 2015-16 2016-17 2017-18 2018-19 Gross Normative Loan 2099.30 2099.30 2099.30 2099.30 2099.30 Cumulative Repayment upto Previous Year 879.18 1038.13 1197.08 1356.03 1514.98 Net Loan-Opening 1220.12 1061.17 902.22 743.27 584.32 Additions 0.00 0.00 0.00 0.00 0.00 Repayment during the year 158.95 158.95 158.95 158.95 158.95 Net Loan-Closing 1061.17 902.22 743.27 584.32 425.37 Average Loan 1140.64 981.69 822.75 663.80 504.85 Weighted Average Rate of Interest on Loan (%) 9.4024 9.4027 9.4031 9.4037 9.4046 Interest on Loan 107.25 92.31 77.36 62.42 47.48

    Depreciation

    39. Clause (2), (5) and (6) of Regulation 27 of the 2014 Tariff Regulations provide that:—

    “27. Depreciation:

    …(2) The value base for the purpose of depreciation shall be the capital cost of the asset admitted by the Commission. In case of multiple units of a generating station or multiple elements of transmission system, weighted average life for the generating station of the transmission system shall be applied. Depreciation shall be chargeable from the first year of commercial operation. In case of commercial operation of the asset for part of the year, depreciation shall be charged on pro rata basis”

    “(5) Depreciation shall be calculated annually based on Straight Line Method and at rates specified in Appendix-II to these regulations for the assets of the generating station and transmission system:

    Provided that the remaining depreciable value as on 31 March of the year closing after a period of 12 years from the effective date of commercial operation of the station shall be spread over the balance useful life of the assets.

    (6) In case of the existing projects, the balance depreciable value as on 1.4.2014 shall be worked out by deducting the cumulative depreciation as admitted by the Commission upto 31.3.2014 from the gross depreciable value of the assets.”

    40. The depreciation has been worked out considering the admitted capital expenditure as on 31.3.2014 and accumulated depreciation up to 31.3.2014 The transmissions asset will be completing 12 years after the tariff period 2014-19; hence depreciation has been calculated annually based on Straight Line Method and at rates specified in Appendix-II of the 2014 Tariff Regulations. The detailed calculations for depreciation for the transmission asset are worked out and allowed as follows:—

    (Rs. in lakh)

    Asset-I Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Depreciation Opening Gross Block 20767.59 20767.59 20767.59 20767.59 20767.59 Additional Capitalization 0.00 0.00 0.00 0.00 0.00 Closing Gross Block 20767.59 20767.59 20767.59 20767.59 20767.59 Average Gross Block 20767.59 20767.59 20767.59 20767.59 20767.59 Freehold Land (Av. Cost) 0.00 0.00 0.00 0.00 0.00 Rate of Depreciation (%) 5.28 5.28 5.28 5.28 5.28 Elapsed life 5 6 7 8 9 Balance Useful life of the asset 27 26 25 24 23 Remaining Depreciable Value 13223.20 12126.03 11028.86 9931.69 8834.52 Depreciation during the year 1097.17 1097.17 1097.17 1097.17 1097.17
    Asset-II Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Depreciation Opening Gross Block 2997.95 2997.95 2997.95 2997.95 2997.95 Additional Capitalization 0.00 0.00 0.00 0.00 0.00 Closing Gross Block 2997.95 2997.95 2997.95 2997.95 2997.95 Average Gross Block 2997.95 2997.95 2997.95 2997.95 2997.95 Freehold Land (Av. Cost) 0.00 0.00 0.00 0.00 0.00 Rate of Depreciation (%) 5.30 5.30 5.30 5.30 5.30 Elapsed life 5 6 7 8 9 Balance Useful life of the asset 20 19 18 17 16 Remaining Depreciable Value 1818.97 1660.02 1501.07 1342.12 1183.17 Depreciation during the year 158.95 158.95 158.95 158.95 158.95

    Operation & Maintenance Expenses (“O&M Expenses”)

    41. Clause 3(a) of Regulation 29 of the 2014 Tariff Regulations specifies the norms for O&M Expenses for the transmission system. The total allowable O&M Expenses for the instant assets have been worked out and allowed are as follows:—

    Asset-I Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 400 kV Bays: No. of Bays 6 6 6 6 6 Norms (Rs. lakh/Bay) 60.30 62.30 64.37 66.51 68.71 Line: D/C Twin/Triple Conductor: Line Length (km) 149.12 149.12 149.12 149.12 149.12 Norms (Rs. lakh/km) 0.71 0.73 0.76 0.78 0.81 Total O&M Expenses (Rs. lakh) 467.23 482.81 498.81 515.37 532.45
    Asset-II Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 400 kV Bays: No. of Bays 1 1 1 1 1 Norms (Rs. lakh/Bay) 60.30 62.30 64.37 66.51 68.71 220 kV Bays: No. of Bays 3 3 3 3 3 Norms (Rs. lakh/Bay) 42.21 43.61 45.06 46.55 48.1 Total O&M Expenses (Rs. lakh) 186.93 193.13 199.55 206.16 213.01

    42. The petitioner has further submitted that the wage revision of the employees of the petitioner company is due during 2014-19 and actual impact of wage hike which will be effective from a future date has also not been factored in fixation of the normative O&M rate specified for the 2014-19 tariff period. The petitioner has also prayed that it will approach the Commission for suitable revision in the norms of O&M Expenses for claiming the impact of such increase. We would like to clarify that any application filed by the petitioner for revision of O&M Expenses on account of wage revision will be dealt with in accordance with the appropriate provisions of the 2014 Tariff Regulations. The O&M Expenses are allowed for the instant transmission asset as per prevailing norms.

    Interest on Working Capital (“IWC”)

    43. Clause 1 (c) of Regulation 28 and Clause 5 of Regulation 3 of the 2014 Tariff Regulations specifies as follows:

    “28. Interest on Working Capital

    (c) (i) Receivables equivalent to two months of fixed cost;

    (ii) Maintenance spares @ 15% of operation and maintenance expenses specified in regulation 29; and

    (iii) Operation and maintenance expenses for one month”

    “(5) ‘Bank Rate’ means the base rate of interest as specified by the State Bank of India from time to time or any replacement thereof for the time being in effect plus 350 basis points;”

    44. The petitioner has submitted that it has computed interest on working capital for the tariff block 2014-19 considering the SBI Base Rate plus 350 basis points as on 1.4.2014 The rate of interest on working capital considered is 13.50%.

    45. The interest on working capital is worked out in accordance with Regulation 28 of the 2014 Tariff Regulations. The rate of interest on working capital considered is 13.50% (SBI Base Rate of 10% plus 350 basis points). The components of the working capital and interest thereon have been worked as follows:—

    (Rs. in lakh)

    Asset-I Interest on Working Capital 2014-15 2015-16 2016-17 2017-18 2018-19 O & M expenses 38.92 40.22 41.55 42.93 44.35 Maintenance Spares 70.08 72.42 74.82 77.31 79.87 Receivables 607.27 592.42 577.64 562.96 548.37 Total 716.27 705.06 694.01 683.20 672.59 Rate of Interest (%) 13.50 13.50 13.50 13.50 13.50 Interest on Working Capital 96.70 95.18 93.69 92.23 90.80
    Asset-II Interest on Working Capital 2014-15 2015-16 2016-17 2017-18 2018-19 O & M expenses 15.57 16.09 16.62 17.17 17.74 Maintenance Spares 28.04 28.97 29.93 30.92 31.95 Receivables 108.31 106.85 105.44 104.05 102.71 Total 151.92 151.91 151.99 152.15 152.40 Rate of Interest (%) 13.50 13.50 13.50 13.50 13.50 Interest on Working Capital 20.51 20.51 20.52 20.54 20.57

    ANNUAL FIXED CHARGES FOR THE 2014-19 TARIFF PERIOD

    46. The transmission charges allowed for the instant transmission assets for the 2014-19 tariff period are summarised below:—

    (Rs. in lakh)

    Asset-I Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Depreciation Opening Gross Block 20767.59 20767.59 20767.59 20767.59 20767.59 Additional Capitalisation 0.00 0.00 0.00 0.00 0.00 Closing Gross Block 20767.59 20767.59 20767.59 20767.59 20767.59 Average Gross Block 20767.59 20767.59 20767.59 20767.59 20767.59 Rate of Depreciation (%) 5.28 5.28 5.28 5.28 5.28 Depreciable Value 18690.83 18690.83 18690.83 18690.83 18690.83 Balance useful life of the asset 27 26 25 24 23 Elapsed life 5 6 7 8 9 Remaining Depreciable Value 13223.20 12126.03 11028.86 9931.69 8834.52 Depreciation during the year 1097.17 1097.17 1097.17 1097.17 1097.17 Cumulative depreciation 6564.80 7661.97 8759.14 9856.31 10953.49 Interest on Loan Gross Normative Loan 14538.03 14538.03 14538.03 14538.03 14538.03 Cumulative Repayments upto Previous Year 5906.60 7003.77 8100.94 9198.11 10295.28 Net Loan-Opening 8631.43 7534.26 6437.09 5339.92 4242.75 Additions 0.00 0.00 0.00 0.00 0.00 Repayment during the year 1097.17 1097.17 1097.17 1097.17 1097.17 Net Loan-Closing 7534.26 6437.09 5339.92 4242.75 3145.57 Average Loan 8082.85 6985.68 5888.50 4791.33 3694.16 Weighted Average Rate of Interest on Loan (%) 9.4135 9.4152 9.4174 9.4205 9.4250 Interest on Loan 760.88 657.72 554.54 451.37 348.17 Return on Equity Opening Equity 6229.55 6229.55 6229.55 6229.55 6229.55 Additions 0.00 0.00 0.00 0.00 0.00 Closing Equity 6229.55 6229.55 6229.55 6229.55 6229.55 Average Equity 6229.55 6229.55 6229.55 6229.55 6229.55 Return on Equity (Base Rate) (%) 15.500 15.500 15.500 15.500 15.500 MAT Rate for respective year (%) 20.961 20.961 20.961 20.961 20.961 Rate of Return on Equity (%) 19.610 19.610 19.610 19.610 19.610 Return on Equity 1221.64 1221.64 1221.64 1221.64 1221.64 Interest on Working Capital O & M Expenses 38.92 40.22 41.55 42.93 44.35 Maintenance Spares 70.08 72.42 74.82 77.31 79.87 Receivables 607.27 592.42 577.64 562.96 548.37 Total Working Capital 716.27 705.06 694.01 683.20 672.59 Rate of Interest (%) 13.50 13.50 13.50 13.50 13.50 Interest of working capital 96.70 95.18 93.69 92.23 90.80 Annual Transmission Charges Depreciation 1097.17 1097.17 1097.17 1097.17 1097.17 Interest on Loan 760.88 657.72 554.54 451.37 348.17 Return on Equity 1221.64 1221.64 1221.64 1221.64 1221.64 Interest on Working Capital 96.70 95.18 93.69 92.23 90.80 O & M Expenses 467.23 482.81 498.81 515.37 532.45 Total 3643.62 3554.52 3465.86 3377.79 3290.24 Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Depreciation Opening Gross Block 2997.95 2997.95 2997.95 2997.95 2997.95 Additional Capitalisation 0.00 0.00 0.00 0.00 0.00 Closing Gross Block 2997.95 2997.95 2997.95 2997.95 2997.95 Average Gross Block 2997.95 2997.95 2997.95 2997.95 2997.95 Rate of Depreciation (%) 5.30 5.30 5.30 5.30 5.30 Depreciable Value 2698.16 2698.16 2698.16 2698.16 2698.16 Balance useful life of the asset 20 19 18 17 16 Elapsed life 5 6 7 8 9 Remaining Depreciable Value 1818.97 1660.02 1501.07 1342.12 1183.17 Depreciation during the year 158.95 158.95 158.95 158.95 158.95 Cumulative depreciation 1038.13 1197.08 1356.03 1514.98 1673.93 Interest on Loan Gross Normative Loan 2099.30 2099.30 2099.30 2099.30 2099.30 Cumulative Repayments upto Previous Year 879.18 1038.13 1197.08 1356.03 1514.98
    Asset-II Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Net Loan-Opening 1220.12 1061.17 902.22 743.27 584.32 Additions 0.00 0.00 0.00 0.00 0.00 Repayment during the year 158.95 158.95 158.95 158.95 158.95 Net Loan-Closing 1061.17 902.22 743.27 584.32 425.37 Average Loan 1140.64 981.69 822.75 663.80 504.85 Weighted Average Rate of Interest on Loan (%) 9.4024 9.4027 9.4031 9.4037 9.4046 Interest on Loan 107.25 92.31 77.36 62.42 47.48 Return on Equity Opening Equity 898.65 898.65 898.65 898.65 898.65 Additions 0.00 0.00 0.00 0.00 0.00 Closing Equity 898.65 898.65 898.65 898.65 898.65 Average Equity 898.65 898.65 898.65 898.65 898.65 Return on Equity (Base Rate) (%) 15.500 15.500 15.500 15.500 15.500 MAT Rate for respective year (%) 20.961 20.961 20.961 20.961 20.961 Rate of Return on Equity (%) 19.610 19.610 19.610 19.610 19.610 Return on Equity 176.23 176.23 176.23 176.23 176.23 Interest on Working Capital O & M Expenses 15.57 16.09 16.62 17.17 17.74 Maintenance Spares 28.04 28.97 29.93 30.92 31.95 Receivables 108.31 106.85 105.44 104.05 102.71 Total Working Capital 151.92 151.91 151.99 152.15 152.40 Rate of Interest (%) 13.50% 13.50% 13.50% 13.50% 13.50% Interest of working capital 20.51 20.51 20.52 20.54 20.57 Annual Transmission Charges Depreciation 158.95 158.95 158.95 158.95 158.95 Interest on Loan 107.25 92.31 77.36 62.42 47.48 Return on Equity 176.23 176.23 176.23 176.23 176.23 Interest on Working Capital 20.51 20.51 20.52 20.54 20.57 O & M Expenses 186.93 193.13 199.55 206.16 213.01 Total 649.87 641.12 632.61 624.30 616.24

    Deferred Tax Liability

    47. The petitioner has sought recovery of deferred tax liability before 1.4.2009 from the beneficiaries or long term consumers/DICs as and when materialized. The deferred tax liability shall be dealt as per Regulation 49 of the 2014 Tariff Regulations, as amended. Accordingly, the petitioner is entitled to recover the deferred tax liability upto 31.3.2009 whenever the same gets materialized directly from the beneficiaries or long term transmission customers/DICs.

    Filing Fee and the Publication Expenses

    48. The petitioner has sought reimbursement of fee paid by it for filing the petition and publication expenses. The petitioner shall be entitled for reimbursement of the filing fees and publication expenses in connection with the present petition, directly from the beneficiaries on pro-rata basis in accordance with Regulation 52 (1) of the 2014 Tariff Regulations.

    Licence Fee & RLDC Fees and Charges

    49. The petitioner shall be entitled for reimbursement of licence fee in accordance with Regulation 52(2)(b) of the 2014 Tariff Regulations for 2014-19 tariff period. The petitioner shall also be entitled for recovery of RLDC fee & charges in accordance with Regulations 52(2)(a) of the 2014 Tariff Regulations for 2014-19 tariff period.

    Service Tax

    50. The petitioner has prayed for reimbursement of service tax if it is subjected to such tax in future. We are of the view that the petitioner's prayer is premature.

    Sharing of Transmission Charges

    51. The billing, collection and disbursement of the transmission charges approved shall be governed by the provisions of Central Electricity Regulatory Commission (Sharing of Inter-State Transmission Charges and Losses) Regulations, 2010, as amended from time to time as provided in Regulation 43 of the 2014 Tariff Regulations.

    52. This order disposes of Petition No. 371.TT/2014.

    Annexure - 1

    Asset I:

    DETAILS OF LOAN BASED ON ACTUAL LOAN PORTFOLIO (2009-14)

    (Rs. in lakh)

    Particulars Interest Rate (%) Loan deployed as on 1.4.2009 Additions during the tariff period Total BOND XX-DOCO-01-APR-2008- 8.93 800.00 0.00 800.00 BOND XX-DOCO-01-AUG-2008- 8.93 2760.00 0.00 2760.00 BOND XXI-DOCO-01-APR-2008- 8.73 250.00 0.00 250.00 BOND XXI-DOCO-01-AUG-2008- 8.73 906.00 0.00 906.00 BOND XXII-DOCO-01-APR-2008- 8.68 180.00 0.00 180.00 BOND XXII-DOCO-01-AUG-2008- 8.68 599.00 0.00 599.00 BOND XXIV-DOCO-01-APR-2008- 9.95 390.00 0.00 390.00 BOND XXIV-DOCO-01-AUG-2008- 9.95 1350.00 0.00 1350.00 BOND XXV-DOCO-01-APR-2008- 10.10 840.00 0.00 840.00 BOND XXV-DOCO-01-AUG-2008- 10.10 2880.00 0.00 2880.00 BOND XXVI-DOCO-01-APR-2008- 9.30 543.00 0.00 543.00 BOND XXVI-DOCO - 01-AUG-2008- 9.30 1038.00 0.00 1038.00 BOND XXVIII-ADDCAP FOR 2008-2009DRAWL ON 15-DEC-2008 - 15-DEC-2008- 9.33 893.37 0.00 893.37 BOND XXVIII-DOCO DRAWL ON 29-SEP-2008 - 29-SEP-2008- 9.33 862.00 0.00 862.00 BOND XXX-ADDCAP FOR 2009-2010 Loan1- 8.80 0.00 391.90 391.90 BOND XXXI-ADDCAP FOR 2010-2011 Loan2- 8.90 0.00 19.68 19.68 BOND XXXI-ADDCAP FOR 2011-2012 Loan3- 8.90 0.00 6.48 6.48 Total 14291.37 418.06 14709.43

    WEIGHTED AVERAGE RATE OF INTEREST ON LOAN DURING 2009-14 TARIFF PERIOD

    (Rs. in lakh)

    Particulars 2009-10 2010-11 2011-12 2012-13 2013-14 Gross Opening Loan 14291.37 14683.27 14702.95 14709.43 14709.43 Cumulative Repayments of Loans upto Previous Year 0.00 0.00 602.92 1647.59 2838.54 Net Loans Opening 14291.37 14683.27 14100.03 13061.84 11870.89 Add: Draw(s) during the Year 391.90 19.68 6.48 0.00 0.00 Less: Repayments of Loan during the year 0.00 602.92 1044.67 1190.95 1225.79 Net Closing Loan 14683.27 14100.03 13061.84 11870.89 10645.10 Average Net Loan 14487.32 14391.65 13580.94 12466.37 11258.00 Rate of Interest on Loan (%) 9.4106 9.4081 9.4132 9.4120 9.4122 Interest on Loan 1363.35 1353.98 1278.40 1173.34 1059.63

    Asset II:

    DETAILS OF LOAN BASED ON ACTUAL LOAN PORTFOLIO (2009-14)

    (Rs. in lakh)

    Particulars Interest Rate (%) Loan deployed as on 1.4.2009 Additions during the tariff period Total BOND XX-DOCO- 8.93 340.00 0.00 340.00 BOND XXI-DOCO- 8.73 70.00 0.00 70.00 BOND XXII-DOCO- 8.68 80.00 0.00 80.00 BOND XXIV-DOCO- 9.95 190.00 0.00 190.00 BOND XXV-DOCO- 10.10 410.00 0.00 410.00 BOND XXVI-DOCO- 9.30 566.00 0.00 566.00 BOND XXVIII-ADDCAP FOR 2008 - 2009 DRAWL ON 15-DEC-2008- 9.33 330.63 0.00 330.63 BOND XXVIII-DOCO DRAWL ON 15-DEC-2008- 9.33 12.00 0.00 12.00 BOND XXX-ADDCAP FOR 2009-2010Loan1- 8.80 0.00 10.11 10.11 BOND XXXI-ADDCAP FOR 2009-2010Loan2- 8.90 0.00 81.14 81.14 Total 1998.63 91.25 2089.88

    WEIGHTED AVERAGE RATE OF INTEREST ON LOAN DURING 2009-14 TARIFF PERIOD

    (Rs. in lakh)

    Particulars 2009-10 2010-11 2011-12 2012-13 2013-14 Gross Opening Loan 1998.63 2089.88 2089.88 2089.88 2089.88 Cumulative Repayments of Loans upto Previous Year 0.00 0.00 56.66 194.66 361.21 Net Loans Opening 1998.63 2089.88 2033.22 1895.22 1728.67 Add: Draw(s) during the Year 91.25 0.00 0.00 0.00 0.00 Less: Repayments of Loan during the year 56.66 138.00 166.55 174.15 Net Closing Loan 2089.88 2033.22 1895.22 1728.67 1554.52 Average Net Loan 2044.26 2061.55 1964.22 1811.95 1641.60 Rate of Interest on Loan (%) 9.4114 9.4032 9.4053 9.4030 9.4021 Interest on Loan 192.39 193.85 184.74 170.38 154.35

    Annexure - 2

    Asset I:

    DETAILS OF LOAN BASED ON ACTUAL LOAN PORTFOLIO (2014-19)

    (Rs. in lakh)

    Particulars Interest Rate (%) Loan deployed as on 1.4.2014 Additions during the tariff period Total BOND XX-DOCO - 01-APR-2008- 8.93 800.00 0.00 800.00 BOND XX-DOCO-01-AUG-2008- 8.93 2760.00 0.00 2760.00 BOND XXI-DOCO-01-APR-2008- 8.73 250.00 0.00 250.00 BOND XXI-DOCO-01-Aug-2008- 8.73 906.00 0.00 906.00 BOND XXII-DOCO-01-APR-2008- 8.68 180.00 0.00 180.00 BOND XXII-DOCO-01-AUG-2008- 8.68 599.00 0.00 599.00 BOND XXIV-DOCO-01-APR-2008- 9.95 390.00 0.00 390.00 BOND XXIV-DOCO-01-AUG-2008- 9.95 1350.00 0.00 1350.00 BOND XXV-DOCO-01-APR-2008- 10.10 840.00 0.00 840.00 BOND XXV-DOCO-01-AUG-2008- 10.10 2880.00 0.00 2880.00 BOND XXVI-DOCO-01-APR-2008- 9.30 543.00 0.00 543.00 BOND XXVI-DOCO - 01-AUG-2008- 9.30 1038.00 0.00 1038.00 BOND XXVIII-ADDCAP FOR 2008-2009 DRAWL ON 15-DEC-2008 - 15-DEC-2008- 9.33 893.37 0.00 893.37 BOND XXVIII-DOCO DRAWL ON 29-SEP-2008 - 29-SEP-2008- 9.33 862.00 0.00 862.00 BOND XXX-ADDCAP FOR 2009-2010 Loan1- 8.80 391.90 0.00 391.90 BOND XXXI-ADDCAP FOR 2010-2011 Loan2- 8.90 19.68 0.00 19.68 BOND XXXI-ADDCAP FOR 2011-2012 Loan3- 8.90 6.48 0.00 6.48 Total 14709.43 0.00 14709.43

    WEIGHTED AVERAGE RATE OF INTEREST ON LOAN DURING 2014-19 TARIFF PERIOD

    (Rs. in lakh)

    Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Gross Opening Loan 14709.43 14709.43 14709.43 14709.43 14709.43 Cumulative Repayments of Loans upto Previous Year 4064.33 5290.12 6515.91 7741.70 8967.49 Net Loans Opening 10645.10 9419.31 8193.52 6967.73 5741.94 Add: Draw(s) during the Year 0.00 0.00 0.00 0.00 0.00 Less: Repayments of Loan during the year 1225.79 1225.79 1225.79 1225.79 1225.79 Net Closing Loan 9419.31 8193.52 6967.73 5741.94 4516.15 Average Net Loan 10032.21 8806.42 7580.63 6354.84 5129.05 Rate of Interest on Loan (%) 9.4135 9.4152 9.4174 9.4205 9.4250 Interest on Loan 944.39 829.14 713.90 598.65 483.41

    Asset II:

    DETAILS OF LOAN BASED ON ACTUAL LOAN PORTFOLIO (2014-19)

    (Rs. in lakh)

    Particulars Interest Rate (%) Loan deployed as on 1.4.2014 Additions during the tariff period Total BOND XX-DOCO- 8.93 340.00 0.00 340.00 BOND XXI-DOCO- 8.73 70.00 0.00 70.00 BOND XXII-DOCO- 8.68 80.00 0.00 80.00 BOND XXIV-DOCO- 9.95 190.00 0.00 190.00 BOND XXV-DOCO- 10.10 410.00 0.00 410.00 BOND XXVI-DOCO- 9.30 566.00 0.00 566.00 BOND XXVIII-ADDCAP FOR 2008-2009 DRAWL ON 15-DEC-2008- 9.33 330.63 0.00 330.63 BOND XXVIII-DOCO DRAWL ON 15-DEC-2008- 9.33 12.00 0.00 12.00 BOND XXX-ADDCAP FOR 2009-2010Loan1- 8.80 10.11 0.00 10.11 BOND XXXI-ADDCAP FOR 2009-2010Loan2- 8.90 81.14 0.00 81.14 Total 2089.88 0.00 2089.88

    WEIGHTED AVERAGE RATE OF INTEREST ON LOAN DURING 2014-19 TARIFF PERIOD

    (Rs. in lakh)

    Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 Gross Opening Loan 2089.88 2089.88 2089.88 2089.88 2089.88 Cumulative Repayments of Loans upto Previous Year 535.36 709.51 883.66 1057.81 1231.96 Net Loans Opening 1554.52 1380.37 1206.22 1032.07 857.92 Add: Draw(s) during the Year 0.00 0.00 0.00 0.00 0.00 Less: Repayments of Loan during the year 174.15 174.15 174.15 174.15 174.15 Net Closing Loan 1380.37 1206.22 1032.07 857.92 683.77 Average Net Loan 1467.45 1293.30 1119.15 945.00 770.85 Rate of Interest on Loan (%) 9.4024 9.4027 9.4031 9.4037 9.4046 Interest on Loan 137.98 121.60 105.23 88.86 72.49
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    Comments

    Power Grid Corporation Of India Ltd. v. Madhya Pradesh Power Management Company Ltd.
    (Jan 7, 2016)