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Section 29 in The Central Electricity Regulatory Commission (Terms And Conditions For Tariff Determination From Renewable Energy Sources) Regulations, 2009
29. Capital Cost Indexation Mechanism
.-The following indexation mechanism shall be applicable in case of small hydro power projects for adjustments in capital cost over the Control Period with the changes in Wholesale Price Index for Steel and Electrical Machinery:CC(n) = P&M(n) * (1+F1+F2+F3)P&M(n) = P&M(0) * (1+d(n))d(n) = [a*{(SI(n-1)/SI(0)-1}+{(EI(n-1)/EI(0))-1}]/(a+b)Where,-CC(n) = Capital Cost for nth yearP&M(n) = Plant and Machinery Cost for nthyearP&M(0) = Plant and Machinery Cost for thebase yearNote.- P&M(0) is to computed bydividing the base capital cost (for the first year of the Control Period) by(1+F1+F2+F3),i.e.| Small Hydro Project | Base CapitalCost (Rs. Lakh/MW) | Factor(1+F1+F2+F3) | P&M(0)`(Rs. Lakh/MW) |
| SHP(< 5 MW) (HP, Uttarakhand, NE States) | 700 | 1.40 | 500 |
| SHP (5-25 MW) (HP, Uttarakhand, NE States) | 630 | 1.40 | 450 |
| SHP (<5 MW) (other States) | 550 | 1.40 | 393 |
| SHP (5-25 MW) (other States) | 500 | 1.40 | 357 |