Procedure For Allotment

Procedure for capacity allocation of wind power projects in Karnataka: 1. Earlier, once in 3 months, KREDL is to release the advertisement

in

the

leading

newspapers

inviting

applications for establishment of wind farms at the notified sites. But at present it is not being adopted. Because the identified

capacity

has

already

been

allotted

to

the

applicants. Only new site have to be explored. Therefore, applications for development of any self identified sites on first come – first serve basis are considered through out the year. Applicants may obtain the standard application form either from KREDL or download it from the KREDL website.. 2. The filled-in application form along with a feasibility report enclosing Rs.30,000/- per MW demand draft drawn in favor of MD, KREDL, payable in Banglore

to be furnished to

KREDL. 3. A

specially

constituted

committee

scrutinises

of

the

applications in-order to judge the financial capability, technical viability and as well the preparedness of the developer. If necessitates, the applicant is given an opportunity to appear before the committee and appraise the committee of his interest and capability to execute the project. 4. Based

on

the

recommendations

of

the

committee

Government. Sanctions the capacity for setting up wind farms.

5. Energy Department also receives “the applications for seeking capacity allocation directly and place in the allotment committee headed by the Principal Secretary, Energy Department after verification of the site by KREDL. Allotment GO’s are issued accordingly. 6. Memorandum of Understanding (MOU): The applicant to

whom capacity allocation is approved is expected to sign an agreement with the Government. The agreement sets out the terms and conditions under which the development is allowed to take place Applicants have to pay DPR scrutiny charges @ Rs. 25,000 per MW to KREDL along with a nonrefundable fee of Rs.5000 per MW before signing the agreement( now this fee is collected along with the application itself). 7. The cost per MW varies from Rs. 4 to 5 crores per MW. The applicant has to submit a feasibility report for the project they wish to apply for, along with evidence of their capacity to raise the minimum equity of 11% of the project cost. 8. Developers have to prepare a Detailed Project Report by engaging the wind energy consultants /specialists and obtain the required statutory clearances from various agencies and submit the same to KREDL. KREDL, in-turn will send the scrutiny report to Government for the issue of NOC. Developers shall execute the project only after the receipt of NOC from the Government.

On the other hand, the applicants may have the wind power projects under the project transfer policy of Govt. of Karnataka and is detailed as below: 1.

As per the norms, any applicant holding wind power capacity/project is allowed to transfer the project or its part capacity to any interested party upon paying the statutory fees of Rs.75, 000/- per MW to KREDL and on submission of mutually agreed letters to KREDL followed by the details of the company in the standard form be furnished.

2.

Accordingly, Government

for

KREDL approval

send of

the

its

recommendations

transfer

of

wind

to

power

capacity/project. 3.

Upon the approval of the Government, the applicant is required to comply the other conditions detailed as above in the serial No. 6, 7 & 8.

The Policy Environment The State Government has enunciated forward looking polices to encourage rapid development of Nonconventional energy projects. The following elements are common for the entire renewable energy sector. 1. Wheeling and banking facility: Karnataka Power Transmission Corporation Limited (KPTCL) allows banking of electricity generated by all renewable energy power projects. A banking charge amounting to 2% of the month-end balance of energy banked is levied. Wheeling of energy is at 5% of the energy wheeled for the self-consumption whereas 5% of the energy wheeled plus with a surcharge of

Rs.1.15ps/kWh is applicable in case of 3rd party sale as per the KERC order. 2. Purchase price for power: KPTCL is purchasing power from renewable energy projects at Rs. 3.40 per unit without any annual escalation valid for the period of 10 years. 3. Third party sale of power: KPTCL allows the sale of power to third party. 4. Electricity tax*: Electricity tax is exempted for a period of 5 years for captive consumption of power generated. 5. Entry tax exemption*: Windmills and its parts and accessories are exempted. 6. Deemed industry status*: Non-conventional energy projects have been given the status of industry under Sec. 109 of Land Reforms Act for the purpose of acquiring lands through Karnataka Industrial Areas Development Board. 7. Green projects status*: Wind and small hydro projects have been accorded green projects status under the Water (Prevention and Control of Pollution) Act, 1974 and the Air (Prevention and Control of Pollution) Act, 1981 respectively. 8. Lease and sub-lease of Government. Lands; The forest and Revenue, Irrigation department lands are being government lands and are released to KREDL on behalf of the respective developer and KREDL in turn–subleases the same either to the developer or their end parties. The period of lease is generally 30 years. But it is extendable to another 20 years depending on the condition of the project. 9. In case of small hydro Government of Karnataka has exempted water royalty up to 25 MW. *Need cross Verification with concerned department.