CERC allows power generators to recover FGD cost over plants’ life

As per a staff paper issued by the Central Electricity Regulatory Commission (CERC), generators will be allowed to recover additional cost on pollution control equipment from electricity charges over a 25-year period.

As per the CERC, 90 per cent of the additional capex on account of installation of the emission control system is proposed to be recovered over the life of the emission control equipment, which is also estimated at 25 years, considering the salvage value of 10 per cent. After a PPA expires, the power producer will have to tie up with another procurer or sell power in the market to recover its remaining costs.

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