Section 27 in Rajasthan Electricity Regulatory Commission (Terms and Conditions for Determination of Tariff) Regulations, 2009
27. Insurance and contingency reserve charge.
- The Commission may consider allowing actual insurance charges or provision for contingency reserve up to 0.25% to 0.50% of approved capital cost considered for O&M expenses. The contingency reserve so created shall not be drawn except to meet such charges as may be approved by the Commission as being:(a)Expenses or loss of profits arising out of accidents, strikes or circumstances which the management could not have prevented;(b)Expenses on replacement or removal of plant or works other than expenses requisite for normal maintenance or renewal; and(c)Compensation payable under any law for the time being in force and for which no provision is made:Provided further that such drawal from Contingency Reserve shall be computed after making the adjustments for any other compensation that may been received by Generating Company/Licensee as part of an insurance cover:Provided further that the Generation Company or Licensee shall submit documentary proof of investment of the amount allowed towards contingency reserve, if any, in Government approved securities under the Indian Trusts Act, and in case the documentary proof of investment is not submitted, the contingency reserve allowed in previous year shall be reduced as a part of truing up and the Commission may also disallow contingency reserve for the ensuing year.
