Tangedco seeks to levy an additional surcharge of Rs 0.88 per unit

Tamil Nadu Generation and Distribution Corporation (Tangedco) has petitioned the Tamil Nadu Electricity Regulatory Commission (TNERC) seeking approval to levy an additional surcharge of Rs 0.88 per unit on the open access consumers who buy power directly from third parties without depending on the state utility.

The open access concept allows consumers like industrial users to buy cheaper power directly from private generators and power exchanges. The move was aimed at increasing competitiveness and efficiency in the power sector. The loss of revenue suffered by Tangedco due to open access was compensated through the levy of a cross-subsidy surcharge.

In the petition, Tangedco has sought the levy of an additional surcharge of Rs 0.88 per unit on open-access consumers for the period from October 1, 2022 to March 31, 2023.

It said that it has tied up with private generators to meet the power demand, but the open-access consumers were not using its power supply and leading to the stranding of generation capacity. “The obligation of the state distribution licensee in terms of power purchase agreements has been and continues to be stranded and there is an unavoidable obligation and incidence to bear fixed costs consequent to such agreements,” it said.

Can’t be levied retrospectively

Tamil Nadu Spinning Mills Association chief advisor K Venkatachalam said that the additional surcharge couldn’t be levied on all the open access consumers. “We are of the opinion that no additional surcharge cannot be levied on captive power users,” he said, adding that the surcharge cannot be levied retrospectively. He also questioned the need for levying additional surcharges months after steeply hiking energy charges for all categories of consumers.

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