TN state depts, PSUs, local bodies owe Tangedco a whopping ₹3,474 cr

Dues totalling upto ₹3,473.72 crore were pending from various government departments, public sector companies and local bodies to Tamil Nadu Generation & Distribution Corporation Ltd (Tangedco) at the end of July 31, 2022.

Out of these government departments, TWAD Board  (Tamil Nadu Water Supply and Drainage Board) is the highest defaulter, owing ₹1,986.53 crore to Tangedco, followed by the local bodies that have a pending amount of ₹909.68 crore.

Local bodies have the maximum number of power service connections, nearly 5,78,749. Of this, many have not paid their bills, and hence the high amount pending.

Also read: Tangedco, 12 other discoms barred from buying power from electricity exchange

Every year, several departments in the state have defaulted, accumulating payment arrears. The state government, through the district collectors, has tried to crack the whip, asking departments to pay their bills without further delay. It also decided to appoint a special officer to coordinate and speed up the process.

“Frequently, senior department officials hold meetings to find a solution to clear the bills. The special officer will coordinate with the departments in every district and ensure they pay their power bills on time,” said a senior Tangedco official requesting anonymity to The Federal.

TWAD board

The TWAD board uses the maximum amount of power to pump water across the state. “Every year, the board defaults in payment of bills and once the government releases funds, it pays a part of the bill and carries forward the balance to the next financial year,” said the official.

“We have asked all departments to start clearing their payments. The Centre has asked the Tangedco-like discoms to provide pre-paid smart meters to these departments so that they will not be able to default. With these meters, power supply will be stopped once the total money is spent.”

Also read: Tangedco’s interest payment on the rise as total debt increases to over Rs 1 lakh crore

Pre-paid smart metering in all government departments will go a long way in ensuring the government’s commitment in bringing discoms back on the path of financial sustainability and promoting energy efficiency, said the Centre. Also, it would serve as a model for emulation by states for defining similar mechanisms that support pre-payment of electricity dues.

To provide uninterrupted, reliable and quality power supply to all the consumers, an operationally efficient and financially sustainable power sector is a must. Further, a senior official pointed out that if all these departments pay the money owed to Tangedco, it will be able to pay off its debts to power generators. 

“We are not able to borrow from any banks to clear out debt with power generators. If the government departments clear their payments, we will be able to clear the money owed to power generators,” said the official.