PDD does not give the WACC calculation. However, it is possible to calculate the return on equity assumed from the information given, which works out to more than 25%. TNERC has recommended a return of only 13.5% post tax. EB recommended return is much lower. Therefore the benchmark is very and DOE should not accept this benchmark. At this rate all projects can be made additional.

In Tamil Nadu, windmills achieve PLF of 30%. PP projects PLF of 22.83% and 24.35% and that too with 1% derating after 10 years. Quite a few projects have already been registered with the same make of machines in Tamil Nadu and all of them have assumed much higher PLF. The PLF is very low and DOE should not accept this. It should check other projects and also the generation by this project and in any case the PLF should not be less than 27.15% recommended by TNERC

The project is eligible for 100% depreciation and tax holiday. Depreciation will enable the company to save tax. This should be taken into account as cash inflow. As this project is part of Surana Corpn., there cannot be MAT. Providing MAT is not as per Income Tax Act. As the purchase order was placed in November, the project must have started before the year end, i.e., March 31. Hence, the cash generation in the first year should be deducted from the investment and only net investment should be taken as cash outflow.

Common practice analysis is not transparent. There are quite a few projects which have been set up without CDM benefits. If the DOE goes through Wind Power Directory it will find out many. PP gives a feeling that all wind power projects are CDM projects, which is not correct.