Section 26 in Bihar Electricity Regulatory Commission (Multi Year Distribution Tariff) Regulations, 2015
26. Interest on Working Capital.
- The Distribution Licensee shall be allowed interest on estimated level of working capital for the financial year, computed as follows:(a)O&M expenses for one month(b)Two months equivalent of expected revenue(c)Maintenance spares @ 40% of R&M expenses for one month:Less:(i)Power purchase cost, transmission charges and load dispatch charges of one month(ii)Depreciation, return on equity and contribution to contingency reserves(iii)Security deposits from consumers, if any.Provided that the interest on working capital shall be on normative basis and rate of interest shall be equal to the State Bank Advance Rate (SBAR) as of the date on which petition for determination of tariff is accepted by the Commission.Provided further that interest shall be allowed on consumer security deposits and security deposits from Distribution System users at the Bank Rate as of the date on which the petition for determination of tariff is accepted by the Commission.Provided further that if the State Government is providing resource gap grant or subsidy, working capital shall be reduced by that amount.
