Benchmark of power plant costs-I: CERC brings out draft norms for thermal plants

In line with sub-clause 2 of Clause 7 of the Terms and Conditions of Tariff Regulations, 2009, the Central Electricity Regulatory Commission (CERC) has brought out the draft norms for benchmarking of capital costs of thermal power stations (TPS). These norms provide for benchmarks, essentially, for power stations comprised of units of 500 MW, 600 MW, 660 MW and 800 MW, as extension or green field projects. 

• Once finalized, these norms will form the basis for the CERC to determine tariffs for power plants over the period April 2009 to March 2014.
• The proposed benchmarks are based on a self-validating model, developed by a consortium of consultancy firms that was put on the job by the apex regulator in September 2008. 
•  For the purpose of evolving these norms, various package-wise distribution of the capital costs of the TPS-- owned by both public and private sectors firms-- of the above-mentioned unit sizes were analyzed by the CERC-appointed consortium. Subsequently, capital cost of each of the packages of a TPS has been worked out, based on which the CERC has notified per-MW benchmark costs.
• CERC intends to finalize these benchmark norms upon the receipt of the public comments on the same, which are due to be submitted by October 11, 2010.