Section 25 in Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019
25. Additional Capitalisation within the original scope and after the cut-off date.
(1)The additional capital expenditure incurred or projected to be incurred in respect of an existing project or a new project on the following counts within the original scope of work and after the cut-off date may be admitted by the Commission, subject to prudence check:(a)Liabilities to meet award of arbitration or for compliance of the directions or order of any statutory authority, or order or decree of any court of law;(b)Change in law or compliance of any existing law;(c)Deferred works relating to ash pond or ash handling system in the original scope of work;(d)Liability for works executed prior to the cut-off date;(e)Force Majeure events;(f)Liability for works admitted by the Commission after the cut-off date to the extent of discharge of such liabilities by actual payments; and(g)Raising of ash dyke as a part of ash disposal system.(2)In case of replacement of assets deployed under the original scope of the existing project after cut-off date, the additional capitalization may be admitted by the Commission, after making necessary adjustments in the gross fixed assets and the cumulative depreciation, subject to prudence check on the following grounds:(a)The useful life of the assets is not commensurate with the useful life of the project and such assets have been fully depreciated in accordance with the provisions of these regulations;(b)The replacement of the asset or equipment is necessary on account of change in law or Force Majeure conditions;(c)The replacement of such asset or equipment is necessary on account of obsolescence of technology; and(d)The replacement of such asset or equipment has otherwise been allowed by the Commission.
