Section 42 in Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019

(1)The fixed cost of a thermal generating station shall be computed on annual basis based on the norms specified under these regulations and recovered on monthly basis under capacity charge. The total capacity charge payable for a generating station shall be shared by its beneficiaries as per their respective percentage share or allocation in the capacity of the generating station. The capacity charge shall be recovered under two segments of the year, i.e. High Demand Season (period of three months) and Low Demand Season (period of remaining nine months), and within each season in two parts viz., Capacity Charge for Peak Hours of the month and Capacity Charge for Off-Peak Hours of the month as follows:Capacity Charge for the Year (CCy) =Sum of Capacity Charge for three months of High Demand Season +Sum of Capacity Charge for nine months of Low Demand Season

(2)The Capacity Charge payable to a thermal generating station for a calendar month shall be calculated in accordance with the following formulae:Capacity Charge for the Month (CCm) =Capacity Charge for Peak Hours of the Month (CCp) +Capacity Charge for Off-Peak Hours of the Month (CCop)Where,High Demand Seasons:

Ccp1=	{(0.20 xAFC)x	(	1	)	x	(	PPFMp1	)	subject to ceiling of (0.20 xAFC)	X	(	1	)
12	NAPAF	12

Ccp2=	{(0.20 xAFC)x	(	1	)	x	(	PAFMp2	)	subject to ceiling of (0.20 xAFC)	X	(	1	)}	- CCP1
6	NAPAF	6

Ccp3=	{(0.20 xAFC)x	(	1	)	x	(	PAFMp3	)	subject to ceiling of
4	NAPAF
	{(0.20 xAFC)x	(	1	)}	x	(	CCP1 + CCP2	)]}
4

Ccop1=	{(0.80 xAFC)x	(	1	)	x	(	PPFMop1	)	subject to ceiling of (0.80 xAFC)	X	(	1	)	}
12	NAPAF	12

Ccop2=	{(0.80 xAFC)x	(	1	)	x	(	PAFMop2	)	subject to ceiling of (0.80 xAFC)	X	(	1	)}	- CCop1
6	NAPAF	6

Ccop3=	{(0.80 xAFC)x	(	1	)	x	(	PAFMop3	)	subject to ceiling of
4	NAPAF
	{(0.80 xAFC)x	(	1	)}	x	(	CCop1 + CCop2	)
4

Low Demand Season:

Ccp1=	{(0.20 xAFC)x	(	1	)	x	(	(PPFMp1)	)	subject to ceiling of (0.20 xAFC)	X	(	1	)	}
12	NAPAF	12

Ccp2=	{(0.20 xAFC)x	(	1	)	x	(	PAFMp2	)	subject to ceiling of (0.20 xAFC)	X	(	1	)}	- CCP1
6	NAPAF	6

Ccp3=	{(0.20 xAFC)x	(	1	)	x	(	PAFMp3	)	subject to ceiling of
4	NAPAF
	{(0.20 xAFC)x	(	1	)}	x	(	CCP1 + CCP2	)
4

Ccp4=	{(0.20 xAFC)x	(	1	)	x	(	PAFMp4	)	subject to ceiling of
3	NAPAF
	{(0.20 xAFC)x	(	1	)}	x	(	CCP1 + CCP2 +CCP3	)
4

Ccp5=	{(0.20 xAFC)x	(	5	)	x	(	PAFMp5	)	subject to ceiling of
12	NAPAF
	{(0.20 xAFC)x	(	5	)}	x	(	CCP1 + CCP2 +CCP3 +CCP4	)
12

Ccp6=	{(0.20 xAFC)x	(	1	)	x	(	PAFMp6	)	subject to ceiling of
2	NAPAF
	{(0.20 xAFC)x	(	1	)}	x	(	CCP1 + CCP2 + CCP3 + CCP4 + CCP5	)
2

Ccp7=	{(0.20 xAFC)x	(	7	)	x	(	PAFMp7	)	subject to ceiling of
12	NAPAF
	{(0.20 xAFC)x	(	7	)}	x	(	CCP1 + CCP2 + CCP3 + CCP4 + CCP5 +CCP6	)
12

Ccp8=	{(0.20 xAFC)x	(	2	)	x	(	PAFMp8	)	subject to ceiling of
3	NAPAF
	{(0.20 xAFC)x	(	2	)}	x	(	CCP1 + CCP2 + CCP3 + CCP4 + CCP5 + CCP6 + CCp7	)
3

Ccp9=	{(0.20 xAFC)x	(	3	)	x	(	PAFMp9	)	subject to ceiling of
3	NAPAF
	{(0.20 xAFC)x	(	3	)}	x	(	CCP1 + CCP2 + CCP3 + CCP4 + CCP5 + CCP6 + CCp7 + CCp8	)
4

Ccop1=	{(0.80 xAFC)x	(	1	)	x	(	PPFMop1	)	subject to ceiling of (0.80 xAFC)	X	(	1	)	}
12	NAPAF	12

Ccop2=	{(0.80 xAFC)x	(	1	)	x	(	PAFMop2	)	subject to ceiling of (0.80 xAFC)	X	(	1	)}	- CCop1
6	NAPAF	6

Ccop3=	{(0.80 xAFC)x	(	1	)	x	(	PAFMop3	)	subject to ceiling of
4	NAPAF
	{(0.80 xAFC)x	(	1	)}	x	(	CCop1 + CCop2	)
4

Ccop4=	{(0.80 xAFC)x	(	1	)	x	(	PAFMop4	)	subject to ceiling of
3	NAPAF
	{(0.80 xAFC)x	(	1	)}	x	(	CCop1 + CCop2 + CCop3	)
3

Ccop5=	{(0.80 xAFC)x	(	5	)	x	(	PAFMop5	)	subject to ceiling of
12	NAPAF
	{(0.80 xAFC)x	(	5	)}	x	(	CCop1 + CCop2 + CCop3 + CCop4	)
12

Ccop6=	{(0.80 xAFC)x	(	1	)	x	(	PAFMop6	)	subject to ceiling of
2	NAPAF
	{(0.80 xAFC)x	(	1	)}	x	(	CCop1 + CCop2 + CCop3 + CCop4 + CCop5	)
2

Ccop7=	{(0.80 xAFC)x	(	7	)	x	(	PAFMop7	)	subject to ceiling of
12	NAPAF
	{(0.80 xAFC)x	(	7	)}	x	(	CCop1 + CCop2 + CCop3 + CCop4 + CCop5 + CCop6	)
12

Ccop8=	{(0.80 xAFC)x	(	2	)	x	(	PAFMop8	)	subject to ceiling of
3	NAPAF
	{(0.80 xAFC)x	(	2	)}	x	(	CCop1 + CCop2 + CCop3 + CCop4 + CCop5 + CCop6 + CCop7	)
3

Ccop9=	{(0.80 xAFC)x	(	3	)	x	(	PAFMop9	)	subject to ceiling of
4	NAPAF
	{(0.80 xAFC)x	(	3	)}	x	(	CCop1 + CCop2 + CCop3 + CCop4 + CCop5 + CCop6 + CCop7 + CCop8	)
4

Provided that in case of generating station or unit thereof under shutdown due to Renovation andModernisation, the generating company shall be allowed to recover O&M expenses and interest on loan only.Where,CCm = Capacity Charge for the Month;CCp = Capacity Charge for the Peak Hours of the Month;CCop = Capacity Charge for the Off-Peak Hours of the Month;CCpn = Capacity Charge for the Peak Hours of nth Month in a specific Season;CCopn = Capacity Charge for the Off-Peak of nth Month in a specific Season;AFC = Annual Fixed Cost;PAFMpn = Plant Availability Factor achieved during Peak Hours upto the end of nth Month in a Season;PAFMopn = Plant Availability Factor achieved during Off-Peak Hours upto the end of nth Month in a Season;NAPAF = Normative Annual Plant Availability Factor.

(3)Normative Plant Availability Factor for "Peak" and "Off-Peak" Hours in a month shall be equivalent to the NAPAF specified in Clause (A) of Regulation 49 of these regulations. The number of hours of "Peak" and "Off-Peak" periods during a day shall be four and twenty respectively. The hours of Peak and Off-Peak periods during a day shall be declared by the concerned RLDC at least a week in advance. The High Demand Season (period of three months, consecutive or otherwise) and Low Demand Season (period of remaining nine months, consecutive or otherwise) in a region shall be declared by the concerned RLDC, at least six months in advance:Provided that RLDC, after duly considering the comments of the concerned stakeholders, shall declare Peak Hours and High Demand Season in such a way as to coincide with the majority of the Peak Hours and High Demand Season of the region to the maximum extent possible:Provided further that in respect of a generating station having beneficiaries across different regions, the High Demand Season and the Peak Hours shall correspond to the High Demand Season and Peak Hours of the region in which majority of its beneficiaries, in terms of percentage of allocation of share, are located.

(4)Any under-recovery or over-recovery of Capacity Charge as a result of under-achievement or over-achievement, vis-à-vis the NAPAF in Peak and Off-Peak Hours of a Season (High Demand Season or Low Demand Season, as the case may be) shall not be adjusted with under-achievement or over-achievement, vis-à-vis the NAPAF in Peak and Off-Peak Hours of the other Season:Provided that within a Season, the shortfall in recovery of Capacity Charge for cumulative Off-Peak Hours derived based on NAPAF, shall be allowed to be off-set by over-achievement of PAF, if any, and consequent notional over-recovery of Capacity Charge for cumulative Peak Hours in that Season:Provided further that within a Season, the shortfall in recovery of Capacity Charge for cumulative Peak Hours derived based on NAPAF, shall not be allowed to be off-set by over-achievement of PAF, if any, and consequent notional over-recovery of Capacity Charge for cumulative Off-Peak Hours in that Season.

(5)The Plant Availability Factor achieved for a Month (PAFM) shall be computed in accordance with the following formula:N

PAFM = 1000 x| ∑| DCi[N x IC x (100 - Aux)]| %| |

i=1Where,AUX = Normative auxiliary energy consumption in percentage.DCi = Average declared capacity (in ex-bus MW), for the ith day of the period i.e. the month or the year as the case may be, as certified by the concerned load dispatch centre after the day is over.IC = Installed Capacity (in MW) of the generating stationN = Number of days during the periodNote. - DCi and IC shall exclude the capacity of generating units not declared under commercial operation. In case of a change in IC during the concerned period, its average value shall be taken.

(6)In addition to the capacity charge, an incentive shall be payable to a generating station or unit thereof @ 65 paise/ kWh for ex-bus scheduled energy during Peak Hours and @ 50 paise/ kWh for ex-bus scheduled energy during Off-Peak Hours corresponding to scheduled generation in excess of ex-bus energy corresponding to Normative Annual Plant Load Factor (NAPLF) achieved on a cumulative basis within each Season (High Demand Season or Low Demand Season, as the case may be), as specified in Clause (B) of Regulation 49 of these regulations.

(7)The provisions under Clauses (1) to (6) of this Regulation shall come into force with effect from 1.4.2020. Till that date, the capacity charge for a thermal generating station determined under these regulations shall be recovered in accordance with the provisions contained in Clauses (1) to (4) of Regulation 30 of the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2014, subject to the condition that the NAPAF and NAPLF shall be taken as specified under these regulations.

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