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Tangedco, 12 other discoms barred from buying power from electricity exchange

Tamil Nadu's Tangedco is among 13 state electricity distribution agencies that have been barred from purchasing power from the Electricity Exchange over non-payment of dues.


Tamil Nadu’s Tangedco is among 13 state electricity distribution agencies that have been barred from purchasing power from the Electricity Exchange over non-payment of dues.

“Tangedco has been barred from buying electricity from the Electricity Exchange. Tamil Nadu distribution company is among 13 states banned due to overdue payments,” said a senior official of the exchange.

Tangedco approaches the exchange when power demand in the state exceeds 16,000 MW. In the past months, since wind power generation was contributing significantly to the state’s power needs, Tangedco sought only less power from the exchange.

“But our dependence on the spot exchange for power supply will increase in the coming weeks when the demand increases and wind power generation goes down,” a Tangedco official said.

While the exchange official said that Tangedco owed more than Rs 900 crore, the Tangedco official said the dues were less than Rs 200 crore and even this will be paid within the next few days.

“There is nothing to be afraid of, we are confident that the ban will be lifted soon and we are also arranging to pay off the remaining amount pending to the exchange,” he said.

Also read: TN power utility Tangedco seeks 6% annual hike in tariff

Power demand is on the rise, especially from Chennai and other urban areas, apparently due to humid weather which is forcing people to use air conditioners.

“The evening peak demand is around 15,500 MW out of this wind power contribution is less than 28.106 million units with the peak generation around 2,500 MW. The total consumption is around 350 million units,” said the official.

Tangedco’s tight financial situation is getting tough to manage, with financial companies refusing to provide loans, especially for working capital.

“We are going through a very bad phase and unless the finances improve, it will be difficult to manage the increasing demand as we need funds to purchase power to meet the demand,” said the official.

A proposal to increase the electricity tariff is in the works and if cleared, is expected to hit homes in a few months. “Once the TNERC gives its permission to revise the tariff, we are expecting not less than Rs 10,000 crore,” said the official.

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