Tamil Nadu Power Purchase Row: Nirmal Kumar Turns to Power Ministry
Image: Daily Thanthi
Tamil Nadu Energy Minister CTR Nirmal Kumar on Sunday, 25 October, asked the Union Ministry of Power to explain why it did not see this month’s power shortage coming, pointing to reports that Rajasthan had paid Rs 46.09 a unit for electricity. He made the remarks in a post on X and at a press meet in Ramanathapuram, according to PTI and Daily Thanthi, as his own government faces opposition attacks for buying emergency power at up to Rs 37 a unit.
Who Pays for Power at Rs 37 a Unit
The Tamil Nadu Power Distribution Corporation (TNPDCL) floated a tender on 6 October for 4,500 MW for 12-31 October, The Week and The News Minute reported. It accepted 2,062 MW for the midnight-to-2 am slot at about Rs 32-34.50 a unit and 2,001 MW for the evening peak at Rs 33.37-37, with 181 MW at the top rate. The News Minute put the extra cost at Rs 5-7 crore a day. Officials told The Week that consumers may not see higher bills at once, but the gap will have to be met through subsidies, borrowing or future tariffs.
Demand Jumped to 21,700 MW
The minister has said demand rose to about 21,700 MW, central stations including NLC India supplied about 1,850 MW less than expected, and wind output fell far short. He also blamed earlier governments for not signing long-term power purchase agreements since 2013. Andhra Pradesh bought about 150 MW for October at Rs 16-20 a unit, contracted by 9 September. The DMK, AIADMK, CPI and CPI(M) have called the purchases poor planning; former minister V Senthil Balaji said the government did not anticipate demand.
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The rules put much of that planning on the states. The Ministry of Power’s 2023 Resource Adequacy guidelines ask the Central Electricity Authority to prepare a national plan, but require each distribution company to plan and contract its own supply in advance, with at least 75% of needed capacity on long-term contracts.
Contracts End on 31 October
The emergency contracts run until 31 October. The state has approved a 560 MW addition at the Udangudi thermal station and says it will sign long-term contracts, but has not said how much power it will buy for November or at what price. The Ministry of Power had not responded publicly to the minister’s remarks by 8 PM IST on 25 October.
More state power and economy news is on the Daily Updates page.
Source: Ministry of Power, Guidelines for Resource Adequacy Planning Framework (2023). Also based on reporting by PTI via ThePrint, Daily Thanthi, The Week, The News Minute and Business Standard.
Image: Daily Thanthi.
