The development is expected to increase the tariffs of these plants by INR0.76 per kwh to INR3.90 per kwh, approximately a 20% increase in the tariff. The INR0.76 per kwh increase will be back dated to electricity provided from 1 April 2009 and will remain ongoing subject to any review by the Chhattisgarh State Electricity Regulatory Commission.
The company believes that there is further potential for tariff increases under long term PPAs across all states, and has initiated negotiations to secure tariff increases within the other states where Greenko has operational assets.
Greenko continues to take advantage of the opportunities presented by direct power sales and has entered into 10 year power purchase agreement from 1 June 2009 with PTC, a government owned power trading company in India. The PPA relates to electricity to be supplied from five small hydro assets currently under development totalling 24MW in Indian state of Himachal Pradesh, for INR5 per kwh base price and with an upside sharing formula if PTC sells on the electricity at a premium to INR5 per kwh.
The projects being developed with a minimum power sale price of INR5 per kwh would enable higher returns in comparison with average long term PPAs at INR3 per kwh.
The company also reported that it has registered AMR Power (24MW) and Sonna (10.5MW) hydro plants for carbon credits with UNFCCC. Rithwik hydro plant is in the final stage of hosting and is expected to be registered by early December 2009. This will mean that five of the six operational assets will be registered creating approximately 300,000 CERs (Certified Emission Reductions) per annum.
Anil Chalamalasetty, CEO and co-founder of Greenko, said: “These recent developments reinforces the mature nature of Indian power markets and reflect the company’s ability to generate additional value from our assets without any change to input costs. New PPAs for the hydro projects under development will help generate greater returns once the assets become operational and ensures long term visibility of merchant rates.
“The CDM registration of two hydro assets will provide a useful additional revenue stream. We will continue to use these additional measures to enhance the value of both existing assets and those under development in order to generate value for Greenko’s shareholders.”
