Section 19(1) in Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2014
(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:Provided that:(i)where equity actually deployed is less than 30% of the capital cost, actual equity shall be considered for determination of tariff:(ii)the equity invested in foreign currency shall be designated in Indian rupees on the date of each investment:(iii)any grant obtained for the execution of the project shall not be considered as a part of capital structure for the purpose of debt : equity ratio.Explanation. - The premium, if any, raised by the generating company or the transmission licensee, as the case may be, while issuing share capital and investment of internal resources created out of its free reserve, for the funding of the project, shall be reckoned as paid up capital for the purpose of computing return on equity, only if such premium amount and internal resources are actually utilised for meeting the capital expenditure of the generating station or the transmission system.
