Status: cleared
Chennai: The Tamil Nadu Electricity Regulatory Commission (TNERC) has asked the state-owned utility’s to augment power generation capacity and distribute the peak hour consumption to keep power purchase costs in check.
In 2023-24 although the TNERC provisionally approved power purchase of 73,730 million units for a cost not exceeding Rs 42,575 crore, TNPDCL ended up buying 82,906 million units at the cost of Rs 55,754 crore. Of this, more than Rs 10,000 crore was spent on short-term power purchase and power purchase from the markets to meet the peak-hour consumption.
While approving the true-up petition of the Tamil Nadu Power Distribution Corporation Ltd (TNPDCL) for 2023-24 in April 2025, the regulatory body observed that only 30 per cent of the electricity requirements of the state is met from its own generation. The remaining power is procured from external sources, market, and private generators. “This external purchase constitutes 60 per cent of the discom’s aggregate revenue requirement. TNPDCL should focus on the augmentation of adequate generating capacity by developing new renewable energy, pumped storage, and battery storage projects and accelerating the development of ongoing thermal, hydro, and other projects,” the commission said.
TNPDCL attributed the spike in power purchase cost to various factors, such as the revision of fixed charges of central generating stations and an increase in the energy charges quoted by generators. TNERC, however, pointed out that the cost of power purchase can be controlled by shifting non-solar peak hour loads to solar hours. Consumers, particularly the agricultural consumers, must be sensitised by the state-wide demand response programme and advised to shift their usage of electricity from non-solar hours to solar hours, it said. “Short-term power purchase shall be limited to the extent possible at a reasonable cost,” it added.
Capacitors for all agri services, leveraging the potential solar power, and solarisation of small feeders are among the other suggestions put forth by TNERC to reduce peak hour consumption.