Some of the details regarding PPA with NEA

Power Purchase Agreement Work Schedule

Preamble
This Work Schedule is prepared for effectively completion of the Power Purchase Agreement (PPA) Between Nepal Electricity Authority (NEA) & Private Power Producer (PPP) up to 25 MW.
Service Fee
As applicable following service Fee have to deposit for PPA to NEA before proceeding for work.

• Up to 1 MW – 75,000/-
• 1 MW to 5 MW – 1, 50,000/-
• 5 MW to 10 MW – 3, 00,000/-
• 10 MW to 25 MW – 4, 50,000/-

PPA Application & Documents
With following documents PPP should apply

1. Survey License
2. Company Registration Certificate
3. Company Certificate of cooperation & memorandum of article
4. Permanent Account Number from Inland Revenue Department
5. No Obligation Certificate from Village Development Committees
6. Letter of Intent from Bank
7. Approved Terms of Reference for IEE or EIA
8. Approval from  National Park if inside National Park.
9. Project Feasibility Study Report with Power Evacuation Study Report

Temporary registration
After submitting application with above said document Temporary registration will be done for verification of document.
Committee formation / Permanent registration
Once document found satisfied the committee will be formed and registration will be done permanent with asking above service fee. And Process will be more forward for PPA

Phases for PPA

First Phase:  Study of Document
It will take 7 Days to finish the study of the document submitted.
Second Phase: Techno Study & Evaluation
Experts & Committee will start the Study of the Project, Which will take 45 days to complete.
The Study consist of following

• Conceptual Layout and Design Study
• Geological Study
• Environmental Issues Study
• Electrical Layouts Study
• Cost and evaluation Study

After finishing above study if any comment arises from experts and developer have to give the reply.
In this phase only following parameters will decided

• Hydrological Parameters
• Electrical Details
• Power and Energy

And Report will be prepared. These all will take 45 days to complete.
Third Phase: Connection Agreement
Developer Company has to do connection Agreement with concerned department of NEA to flow electricity in NEA Transmission Line. After finishing Second Phase Power trading department of NEA will send request letter to concerned department for connection Agreement. It will take approximate 70 days to complete the connection agreement process and come to power trading department.  Following document will attached while requesting for Connection agreement.

1. Salient Features
2. Power and Energy Table
3. Electrical Single Line Diagram
4. Location Map
5. Project construction Schedule
6. Power Evacuation Study Report.

Concerned Department will take 60 Days to tell whether it’s possible to have connection or not to Power trading Department in advance.
In This Phase, Impact Study for Load flow from the Project to NEA Transmission Line will be carried out with   Load able to flow or not. According to NEA Grid Code fee will be determined for the Impact Study.
Fee Structure

Description	For Transmission study carried by developer (NRs)	For Transmission Study Carried by NEA (NRs)
Impact Study with Load Flow Only		Year – 1	Year – 2	Year – 3	Year – 4
Impact Study for >=5 MW to < 25 MW (75 %)	75,000	19,000	38,000	56,000	75,000

In this Process

• Familiarization with Project
• Data Analysis
• Scheme Study
• Updating NEA Model
• Modelling
• Load Flow Study
• Contingency Analysis
• Short Circuit Analysis

Etc will be studied and report will be prepared. Above mention report will govern the connection agreement. If possible then only connection agreement will be done.
If it’s not possible to do the connection agreement then Developer will be informed immediately regarding non happening of PPA.
What ever comment or answer NEA will needing for Second and Third Phase of work will have to provide by the Developer. If Developer fails to submit the comment in time then PPA may take longer time then what committed.
Forth Phase: PPA Draft work
Representative from Finance department, representative from Law and negotiation Department   , concern engineer and other expert from NEA will work no Draft work of PPA

1. Reviewing all document & Connection agreement
2. Study of Technical committee report
3. PPA draft preparation
4. Taking consent from developer
5. Taking approval from NEA management for Draft PPA.

Above work will take approximately 10 days.  After preparation of Draft PPA within 7 days consent will be taking developer and send for approval from NEA management.
It will take around 7 days to get approval from the NEA management.
After the approval both party will sign the PPA. It will take approx 5 days to complete.
It is assumed that if all Above Phase will goes in time then PPA will completed in 99 days.
Guarantee Management 
As per NEA rule PPP should submit performance Guarantee before PPA.

Power Purchase Rate:
As Per NEA Board Decision made on 2065/7/5 BS PPA upto 25 MW the rate will 7 Rs Per unit for Dry Month and 4  Rs. Per unit for Wet Month. In that rate 3% escalation every year upto for 9 times. Last rate Should 8.89 Rs per   unit for Dry month and 5.08 Rs per unit for wet month.
*On above rates 20 % increment have been given.
PPA duration:
Duration for PPA will be 30 years from date of commissioning of Project.