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‘Tangedco must stop levying surcharge on third party power’

According to reports, with the unscheduled power cuts coming to haunt the industries in Tamil Nadu (other than Chennai) again, industry associations in these areas have demanded that Chennai be treated on par with the rest of the state in enforcing load shedding.

They have also questioned the logic of Tamil Nadu Generation and Distribution Corporation (Tangedco) levying subsidy surcharge on the power the industries sourced from power exchanges as this was not produced by Tangedco for it to incur any loss.

Speaking to Business Line after a meeting of industry associations from different parts of the State here to take stock of the worsening power situation, D. Balasundaram, President, Tamilnadu Electricity Consumers Association (TECA), Coimbatore, said unscheduled power shutdowns continue to be the scourge of the industries in Tamil Nadu located outside Chennai.

The state’s capital was exempted from the long hours of load shedding that the rest of Tamil Nadu was subjected to. Industry associations wanted this to end and want the available power to be distributed equitably across the State

He said there was also an anomalous situation of consumers, largely HT consumers, who are paying a subsidy surcharge to Tangedco for the third party power sourced by them from two power exchanges.

To meet the shortage in power availability, industries procure power from Power Exchange of India Ltd and Indian Energy Exchange.

Balasundaram explained that the total cost of this third party power worked out to Rs 10 per unit to the industries in Tamil Nadu. The industries resort to this purchase to tide over the power shortage during peak hours. For this, apart from the basic cost of power, the industries in the State paid to Tangedco Rs 3.50 to Rs 3.60 per unit as surcharge. Besides, they had to pay 35 paise per unit to the transmission corporation as wheeling charge and another 5 per cent of the power was taken by Tangedco for line loss.

The TECA President said Tangedco generally levied cross subsidy surcharge on big power consumers to compensate the loss it incurred on power it produced and supplied either free or at a lesser cost to others. However, he questioned the justification for levying the surcharge on the power procured by the industries through the power exchanges.

Tangedco did not incur any loss in the third party power since it was not subsidised power. Still it collected subsidy-surcharge, which the industries want it to end. It can resume collection of surcharge once it met this gap in power availability.

Commenting on the reasons for the acute power shortage suffered by the state, on which the Centre and State governments had differed, Balasundaram pointed out that apart from the problems in the Vallur power station, three power stations under Tangedco at Chennai, Mettur and Thoothukudi had suffered a cumulative production loss of 1,250 MW due to reasons like mechanical problems or coal shortage.

He said the industry associations will seek a meeting with the Tamil Nadu Chief Minister, J. Jayalalithaa, to apprise her of the ground realities.

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