AVAILABILITY BASED TARIFF- UI

MECHANISM

By S.KEJRIWAL
Executive Engineer(Commercial)
ERPC, KOLKATA
 Sequence of Events
• Two part Tariff since 1992 (K.P.Rao Committee
Report)
• Till late 90’s Govt of India determined tariff as
per Section 43A(2) of the Electricity Supply
Act, 1948
• Deficiences of tariff regime
• Govt appoints M/s ECC,USA in 1994 to
prepare and submit a report
 Sequence of Events.....contd
• The study funded by ADB
• M/s ECC,USA submits report in Nov,1994
• Suggests implementation of ABT
• Govt constitutes NTF/RTFs in 1995 to study
the report
• CERC established under Electricity Regulatory
Commissions Act,1998 to regulate tariff
owned by Gencos owned and controlled by
central govt w.e.f 15.05.1999
 Sequence of Events.....contd
• Govt pursued its efforts, held due consultations
and finally forwarded the ECC report alongwith
NTF minutes and a note on ABT to CERC in May
1999
• The matter was heard in CERC from 26-28th of
July,1999
• CERC issued ABT order dated 04.01.2000
• Order stayed various High courts of the country
due to objections/apprehensions expressed by
various SEBs/GENCOs
• Hon’ble Supreme court finally vacated the stay
 Implementation of ABT:
ABT was finally implemented in India in the
following manner:
• From 01.07.2002 in WR
• From 01.10.2002 in NR
• From 01.01.2003 in SR
• From 01.04.2003 in ER
• From 01.11.2003 in NER
 Basic Problems in Pre-ABT regime
• Low freq during peak time
• High freq during off-peak time
• Rapid and wide changes in freq ( apprx 1 Hz in
5-10 minutes)
• Frequent grid disturbance resulting in tripping
of generating stations, interruption of supply
to large blocks of consumers and
disintegration of regional grid
 Basic Problems in Pre-ABT regime
• Damages caused at both load and generation
ends remained unquantified and unevaluated
• Operational/Commercial disputes/disagreements
amongst various utilities due to conflict of
interest
• Absence of suitable incentives and disincentives
for those responsible for the problem
• Lack of adequate generation, transmission and
distribution capacity
 Possible Solution
• Maximization of generation along with load
curtailment during peak hours
• Backing down of generation to match low
demand during off-peak hours
• Imposing suitable incentives/disincentives to
ensure efficient grid operation
• Enhancing generation and transmission
capacity
• Demand side management
 PRE-ABT TARIFF STRUCTURE:
TWO PART TARIFF:
FIXED CHARGE:
• Return on equity
• O & M expenses
• Interest on loan
• Interest on Working capital
• Depreciation
• Income Tax
 PRE-ABT TARIFF STRUCTURE:
2. VARIABLE CHARGE:
• Primary fuel – Coal/gas
• Secondary fuel – Oil

Both Fixed Cost as well as Variable Costs were

charged to the beneficiaries in the proportion of
actual energy drawn by them during a period
 ABT TARIFF STRUCTURE:
THREE PART TARIFF:

1. FIXED CHARGE:
• Generators assigned target availability
• Total fixed cost payable to a generator over the year is
linked to the average annual availability. Hence the name
Availability Based Tariff
• Charged to beneficiaries in the proportion of their share in
the generating station

2. VARIABLE CHARGE:
• Charged to beneficiaries to the extent of their drawal
schedule
 ABT TARIFF STRUCTURE:
THREE PART TARIFF:
3. UNSCHEDULED INTERCHANGE(UI) CHARGE:
• Actual Generation – Scheduled Generation (For
Generators)
• Total Actual Drawal – Total Scheduled Drawal
(For Beneficiaries)
• Worked out for each 15 min time block
• Based on average frequency of the relevant time
block
 ABT TARIFF STRUCTURE:
THREE PART TARIFF:
3. UNSCHEDULED INTERCHANGE(UI) CHARGE:
• Overdrawal/Underinjection under low freq
(Penalty)
• Overinjection/Underdrawal under high freq (Nil
or low reward)
• Overdrawal/Underinjection under high freq (Nil
or low Penalty)
• Overinjection/Underdrawal under low freq
(Reward)
ADVANTAGES OF ABT:
• Incentivises generators to maximise generation
during peak hours
• No financial loss due to backing down of
generation during off peak hours
• Facilitates merit order despatch
• Better system operation
• Ensures grid discipline
ADVANTAGES OF ABT:
• Introduces transparency and works as
vigilance
• Opens avenue for interstate, inter-regional
bilateral trading of power
• Harness surplus captive generation
• Embedded generators can sell surplus
power to other SEBs
UI ACCOUNTING – PRELIMINARY PROCESS AND
ROLE OF RLDCs:

SCHEDULING:
• Each day of 24 hours starting from 00.00 hours be
divided into 96 time blocks of 15 minutes each
• Each generating station is to make advance
declaration of its capacity for generation in terms
of MWh delivery ex-bus for each time block of
the next day
• Based on the above declaration, concerned RLDC
shall communicate to the various beneficiaries
their respective shares of the available capability
UI ACCOUNTING – PRELIMINARY PROCESS AND
ROLE OF RLDCs:
SCHEDULING:
• After the beneficiaries give their requisition for
power based on the generation schedules, the
RLDC shall prepare the generation schedules and
drawal schedules for each time block after taking
into account technical limitations and
transmission constraints
• The schedule of actual generation shall be
quantified on ex-bus basis for generators
• scheduled drawals shall be quantified at their
respective receiving points for beneficiaries
UI ACCOUNTING – PRELIMINARY PROCESS AND
ROLE OF RLDCs:
SCHEDULING:
• In case of any forced outage of a unit, or in case of any
transmission bottleneck, RLDC will revise the
schedules.Revision will be effective from 4th time block
• Any beneficiary/generator may also request RLDC for
revision of Schedule. Revision will be effective from 6th time
block
• RLDC is also entitled to revise (if need be), the schedules
during the day in the interest of better system
operation.Revision will be effective from 4th time block
• In the event of any grid disturbance, the schedules of both
generation and drawal shall be deemed to have been
revised to be equal to their actual generation/drawal
 UI ACCOUNTING – PRELIMINARY PROCESS AND
ROLE OF RLDCs:
METERING AND METERDATA PROCESSING:
ABT complaint Special Energy Meters (SEM of appropriate
accuracy class) to be installed by CTU at :
• HV side of GT (For Generators)
• All outgoing feeders (For Generators)
• Auxiliary and Station Transformers (For Generators)
• CTU-State interface including state end (For
States/beneficiaries)
• Both ends of inter-state tie lines (For States/beneficiaries)
• Inter-regional interfaces
 UI ACCOUNTING – PRELIMINARY PROCESS AND
ROLE OF RLDCs:
METERING AND METERDATA PROCESSING:

Special Energy Meter (SEM) records :

• 15 min time block wise Actual energy drawal/injection

starting from 00 hrs for 96 blocks
• Cumulative Whr
• Reactive energy drawal/injection for the entire day at HV
condition
• Reactive energy drawal/injection for the entire day at LV
condition
 UI ACCOUNTING – PRELIMINARY PROCESS AND
ROLE OF RLDCs:
METERING AND METERDATA PROCESSING:

• All Regional entities including beneficiaries/generators are

responsible for downloading raw meterdata and sending it to
RLDC
• RLDC to further process the data and transmit the processed
data to RPC for accounting purpose
• RLDC to also send time block wise frequency for each day of the
week along with time block wise schedule for each regional
entity for each day of the week
• RLDC to also intimate any discrepancy with respect to
addition/outage of any line in the network of any entity, outage
of any generating unit, any erroneous metering, and any other
information having commercial implication
 UI ACCOUNTING –ROLE OF RPCs:

• Design program as per the relevant CERC Regulation

incorporating various rate/volume cappings and UI
rate vector for accounting
• Every week download the processed meterdate
along with schedules and frequency sent by RLDC
• Incorporate the changes/discrepancies in the
network and metering with respect to the previous
week
• Feed inputs(Actual, Schedule and frequency) to the
program
 UI ACCOUNTING –ROLE OF RPCs:

• Calculate Total Actual drawal/injection, Schedule

drawal/injection and UI/Deviation charges including
additional UI/Deviation charges for each regional entity for
each day of the week
• Calculate Total Actual drawal/injection, Schedule
drawal/injection and UI/Deviation charges including
additional UI/Deviation charges for each regional entity for
entire week
• Apportion any pool surplus/deficit among the beneficiaries
• Issue the final weekly account and publish in the website
• Revise the account as and when required
 UI Rate Vector
In 2000 CERC ABT order, Frequency band fixed at
50.5 Hz to 49.5 Hz
UI Rates :
• For f > 50.5, R=0
• For 49<f<50.5, R increases at 4.8 p/u for every
0.02 Hz decrease
• At f=49, R= 360p/u (subsequently revised to 420
p/u)
• Maximum UI rate linked to price of diesel
generated power
 UI Rate Vector
In 2004 CERC Tariff regulation effective from 01.04.2004:
UI Rates :
• For f > 50.5, R=0
• For 49<f<50.5, R increases at 8 p/u for every 0.02 Hz
decrease
• At f=49, R= 600p/u (subsequently revised to 570 p/u
w.e.f 01.10.2004)
• For Central Sector generating stations, Actual
generation restricted to 105% of DC in a time block and
101% of DC over a day
 UI Rate Vector
NRLDC filed a petition in CERC in 2006 praying
for increase in UI rate alongwith imposition of
volume capping:
Reasons:
• Consistent low freq
• Deliberate disabling of UFR
• Non requisitioning of liquid fuel generation
• Payment defaults
 UI Rate Vector
• On 26.04.2007 CERC issued notification for UI charges
where maximum UI rate was 930p/u.
• Challenged by UPPCL in Allahabad High court
• Suo moto petition in june 2006
UI Rates:
• For f > 50.5, R=0
• For 49.8<f<50.5, R increases at 6 p/u for every 0.02 Hz
decrease
• At f=49.8, R= 210p/u
• For 49.5<f<49.8, R increases at 9 p/u for every 0.02 Hz
decrease
• At f=49.8, R= 345p/u
• For 49<f<49.5, R increases at 16 p/u for every 0.02 Hz
decrease
• At f=49.8, R= 745p/u