Section 18 in Jharkhand State Electricity Regulatory Commission (Terms and Conditions for Distribution Tariff) Regulations, 2004
18. Additional capitalisation.
- 18.1 The capital expenditure within the original scope of work relating to following nature actually incurred after the date of commercial operation up to the cut-off date may be admitted by the Commission subject to prudence check.(i)Deferred liabilities,(ii)Works deferred for execution,(iii)Liabilities to meet award of arbitration or in satisfaction of the order or decree of a court, and(iv)On account of change in law:Provided that original scope of works alongwith estimates of expenditure shall be submitted alongwith the application for provisional tariff.18.2The capital expenditure of the following nature actually incurred after the cut-off date may be admitted by the Commission subject to prudence check:(i)Deferred liabilities relating to works/services within the original scope of work,(ii)Liabilities to meet award of arbitration or in satisfaction of the order or decree of a court,(iii)On account of change in law:(iv)Any additional work/service which has become necessary for efficient and successful operation of plant but not included in the original capital cost.Impact of additional capitalisation in tariff revision within the approved project cost may be considered by the Commission once in a tariff period.Note 1. - Any expenditure admitted on account of committed liabilities within the original scope of work and the expenditure deferred on techno-economic grounds but falling within the original scope of work shall be serviced in the normative debt-equity ratio arrived at in the manner indicated in regulation 18.Note 2. - Any expenditure on replacement of old assets shall be considered after writing-off the entire value of the original assets from the original capital cost.Note 3. - Any expenditure admitted on account of new works not in the original scope of work shall be serviced in the normative debt equity ratio of 70 : 30.Note 4. - Any expenditure admitted on account of new works not in the original scope of work shall be serviced in the normative debt-equity ratio of 70 : 30 after writing-off the original amount of the replaced assets from the original capital cost.Note 5. - The scrutiny 01 the project cost estimates by the Commission shall be limited to the reasonableness of the capital cost, financing plan, interest during construction, use of efficient technology and such other matters for the purposes of determination of tariff.
