Karnataka Power Corporation Limited 1 Hydro-thermal mix

Karnataka Power Corporation Limited 1

Hydro-thermal mix ALL INDIA – 106111 MW as on 1. 4. 2003 KARNATAKA 6539 MW 1. 4. 2003 (KPCL+VVNL+IPP+CGS) 2

Installed Capacity of Karnataka 6539 mw Hydro-Thermal Mix of KPCL--Total capacity 4350. 505 mw 3 4

INSTALLED CAPACITY KPCL VVNL Central Private Total Thermal 1470 128 840 776. 90 3215 Hydel 2875. 95 221 - 130. 02 3227 Wind 4. 55 - - 92. 20 97 Total 4350. 50 349 840 999. 12 6539 Total non-conventional : 440 MW (wind+mini hydel+biomass+cogeneration) 4

Growth in Installed Capacity - KPCL 5

Performance of KPCL Stations Apr - Sep (2003 - 04) 2003 - 04 2002 -03 Total Generation (MU) 8912 8400 Thermal (MU) 5434 5041 Hydel (MU) 3467 3352 Wind Farm (MU) 10. 883 7. 081 RTPS PLF 84. 16 % 91. 09% 6

List of projects executed (MW) RTPS - 7 X 210 = 1470 THERMAL Sharavathy-10 x 103. 5 = 1035 Linganamakki-2 x 27. 5 Nagjhari-3 x 150+3 x 135 Supa-2 x 50 = 55 = 855 = 100 Varahi-2 x 115 Mani Dam-2 x 4. 5 Ghataprabha-2 x 16 Mallapur-2 x 4. 5 Mini hydel Bhadra Kadra 3 x 50 Kodasalli 3 x 40 = 230 = 9 = 32 = 9 = 1. 75 = 39. 2 = 150 = 120 Gerusoppa 4 x 60 = 240 Total hydel = 2875. 95 Kappatagudda - Grand total HYDEL = 4. 555 WIND = 4350. 505 7

Performance of RTPS Particulars 97 -98 98 -99 99 -00 00 -01 01 -02 02 -03 03 -04 (30. 9. 03) Generation 5538 6013 7762 8904 8954 10292 5433 (MU) P L F (%) 75. 26 81. 72 81. 52 80. 67 81. 12 90. 39 84. 16 Av. Factor 88. 60 90. 44 87. 41 87. 63 84. 78 92. 39 86. 47 Aux. Cons % 8. 26 8. 21 8. 00 8. 15 8. 53 8. 50 8. 68 Sp. Coal Cons. 0. 711 0. 706 0. 713 0. 678 0. 637 0. 642 0. 66 (kg/kwh) Station heat rate 2720 2589 2544 2486 2498 2504 Sp. Oil Cons. 0. 771 1. 09 1. 237 1. 546 1. 084 0. 668 0. 7 (ml/kwh) PLF - National average - 72% CEA norms for 210 MW units, aux. consumption - 9. 5% 8

Performance of Hydro stations Particulars 97 -98 98 -99 99 -00 00 -01 01 -02 02 -03 03 -04 (30. 9. 03) Generation ( Million Units) 10350 9858 11711 10544 9268* 6846** 3469 Total inflows (TMC) 341 282 323 307 208 192 182 Av. Factor % 89. 12 89. 95 89. 16 92. 64 87. 34# 85. 35# 86. 38 Aux. Cons % 1. 22 1. 07 1. 10 1. 06 0. 94 1. 19 -- * due to poor monsoon; ** due to worst monsoon # units under R&M 9

Employees position Capacity Corporate Workmen Total in mws in Nos. Hydro 2881 2604 3785 Thermal 1470 808 1582 2390 Corporat e office -- 435 251 686 Total 6811 10

DETAILS OF O&M EXPENDITURE, AND ESTABLISHMENT EXPENSES (IN RS CRORES) Year Establishment expenses O&M expenditure Hydro RTPS Total 93 -94 9. 80 9. 81 19. 61 60. 66 94 -95 6. 03 6. 41 12. 44 71. 29 95 -96 8. 42 18. 77 27. 19 96. 90 96 -97 9. 08 22. 85 31. 93 114. 03 97 -98 9. 30 27. 17 36. 47 116. 44 98 -99 8. 93 27. 28 36. 21 133. 55 99 -00 13. 61 29. 60 43. 21 194. 41 00 -01 12. 53 32. 95 45. 48 253. 86 01 -02 11. 37 38. 69 50. 06 256. 88 02 -03 12. 09 44. 46 56. 55 231. 22 11 03 -04 5. 22 22. 52 27. 74 196. 43

Annual availability factor of generating stations in % Hydel Station 96 -97 97 -98 98 -99 99 -00 00 -01 01 -02 02 -03 SGS 81. 02 90. 79 90. 28 93. 50 93. 88 90. 92 92. 21 LPH 87. 90 93. 80 92. 28 98. 51 95. 24 99. 00 87. 35 Bhadra 73. 77 74. 52 92. 44 91. 94 90. 71 75. 47 81. 85 NPH 83. 36 87. 01 88. 68 83. 61 91. 50 81. 35 75. 20 SPH 96. 75 75. 37 84. 10 87. 19 87. 03 88. 05 94. 71 VUGPH 97. 42 95. 10 92. 39 88. 52 92. 81 90. 00 MDPH 85. 00 94. 63 84. 30 90. 39 84. 23 86. 21 81. 23 GDPH 99. 46 99. 57 95. 77 99. 07 86. 56 81. 74 90. 31 Kadra 86. 42 98. 34 83. 74 93. 85 91. 77 86. 48 KODASALLI 78. 46 91. 59 90. 75 92. 10 94. 59 GERUSOPPA 84. 10 75. 33 AVERAGE HYDRO 84. 49 89. 12 89. 95 89. 16 92. 48 87. 34 85. 35 AVERAGE Thermal 85. 73 88. 21 90. 44 87. 41 87. 63 84. 61 92. 39 91. 35 88. 71 99. 38 98. 65 Kappatagudda wind farm 12

Sharavathi & Linganamakki O&M cost (Rs Lakhs) Item 95 -96 96 -97 97 -98 98 -99 99 -00 00 -01 01 -02 Employee cost 1371. 62 1697. 98 1904. 84 1862. 39 2314. 26 2358. 90 2516. 48 Administrative & Misc. exp 73. 81 50. 84 92. 67 92. 74 97. 45 126. 84 163. 19 Operation & Maintenance Expenses 632. 55 421. 23 409. 69 396. 22 528. 74 415. 11 337. 26 Corporate Office Exp allocated 436. 38 434. 01 361. 08 540. 81 940. 94 1798. 53 1749. 82 13 TOTAL 2514. 36 2604. 06 2768. 28 2892. 16 3881. 39 4699. 38 4766. 75

Nagjhari & Supa- O&M cost 95 -96 96 -97 97 -98 98 -99 99 -00 00 -01 01 -02 1 Employee cost 1848. 67 2068. 66 2262. 67 2353. 18 2011. 74 1953. 92 1970. 34 Administrative & Misc. expenses 2 114. 05 101. 43 119. 08 136. 91 90. 38 80. 60 85. 02 Operation & Maintenan ce Expenses 3 344. 51 333. 04 344. 68 412. 07 215. 86 267. 46 238. 12 Corporate Office Expenses allocated 4 484. 52 500. 63 408. 96 667. 50 741. 75 1427. 23 1330. 22 ITEM 14 TOTAL 2791. 75 3003. 76 3135. 39 3569. 66 3059. 73 3729. 21 3623. 70

Varahi & Mani Dam Power House - O&M cost ITEM 95 -96 96 -97 97 -98 98 -99 99 -00 00 -01 01 -02 Employee cost 1140. 79 1263. 38 1238. 14 1295. 36 1655. 83 1664. 49 1667. 45 Administrative & Misc. exp 79. 52 72. 98 79. 12 94. 51 101. 46 114. 89 113. 13 Consumption of Stores & Spares 142. 60 177. 73 243. 77 85. 41 166. 64 145. 24 206. 77 Corporate Office Expenses allocated 286. 21 302. 82 234. 15 339. 31 615. 66 1193. 26 1152. 66 15 TOTAL 1649. 12 1816. 91 1795. 18 1814. 59 2539. 59 3117. 88 3140. 01

Salient submission Ø For future plant norms justification can be discussed up-front. Ø For existing plant : - There is a need to understand Industry as it exists. - Environment under which it is performing - Norms shall address enabling provision to pull up performance. Ø While wielding carrot/stick care is needed as it may danger the Industry. 16

Salient submission Ø Tariff norms shall cover methodology of Tariff fixation of existing plants considering a) capacity of the plant b) Vintage/Technology c) Present level of performance d) Level of redundancy/stock of Insurance spares e) Type of fuel. F) Constraints for improvements g) Possibility of sustenance of the present level of performance 17

Salient submission Ø Should spell the - Principle guiding fixation of base level of performance for reward/penalty. Ø Norms shall be dynamic to absorb improvement in performance as Industry matures. - Hence provision for review/revision indicating review period - Shall cover the basic frame structure of Tariff setting Ø Fixed/variable components - Pass through components with reasons 18

Salient submission Ø Merit order dispatch: - Present system considers only the variable cost irrespective of fixed cost. - Hence power with high fixed and low variable cost gets dispatched on priority. - Care shall be taken while posting ‘Take or pay commitment for fuel’ in fixed comportment. - Shall provide for risk mitigation such as for: - Coal - Railways - Monsoon vagaries 19

Salient submission ØPeak & off peak tariff for hydro stations ØInsurance of hydel assets ØImpact due to poor receivables ØImpact of size of hydro plants on: - Availability - Auxiliary consumption ØImpact of the inheritance of chronic problems on plant availability 20

Operating Norms- Thermal ØROE - 16%(Post tax) Ø - 80 : 20 Debt- equity Ø - Translates to Net ROE 13. 33% ØSHR - 2500 Kcal/Kwh or Actuals Ø whichever is lower for 210 MW ØAC - 9% ØAVF/PLF - 80%/ 75% Ø No LC rebate after due date 21

Operating Norms- Hydro ØAC - 1% for overground Ø 1. 5% for underground ØAVF - 85% ØPeak an off peak tariff ØReview for Design Energy ØTwo-part tariff structure ØIncentives Ø No LC rebate after due date 22

Operating Norms ØO & M - Base year 2002 -03 (actuals) Ø - Escalation linked to Index Ø - No adjustment factor for improved productivity 23

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