MSMEs oppose power factor penalties in Tamil Nadu

CHENNAI: Even as the MSMEs continue to protest seeking the rollback of the power tariff hike, the Tangedco has started imposing steep penalties on micro industries and miscellaneous and general purpose category low-tension consumers not maintaining a power factor of 0.85 without any load cap.

In the latest tariff order, the TNERC has removed the 18.5-kilowatt connected load cap on LT-3B and LT-5 consumers to maintain a power factor of not less than 0.85. Earlier, the LT-3B and LT-5 consumers with a connected load of 18.5 kW and above alone have to maintain the power factor.

Senthil Kumaran, who owns a Lathe unit in Irugur in Coimbatore, said that he received an electricity bill of Rs 20,843 for September including a low power factor penalty of Rs 9031. “Usually, my unit’s energy charges would be Rs 6,500 to Rs 7,000. This time the bill amount has more than doubled due to the levying of the penalty. We are not aware of such regulation until they imposed penalty,” he said.

Power factor is a measure of how efficiently electricity is used by the consumer. While the consumers with the connected load of 18.5 kW would have installed capacitors to maintain the power factor, the Tamil Nadu Electricity Regulatory Commission (TNERC) made it mandatory for all the LT-3B and LT-5 consumers in the latest order. J James, president, the Federation of Coimbatore Industrial Associations (FOCIA) has written to the Micro, Small and Medium Industries Secretary alleging that the Tangedco has imposed penalties of up to 150 per cent on micro industries consumers on the power bill of August and September.

“The penalty has severely impacted the livelihood of micro industries. We urge the state government to immediately withdraw the penalties,” he said, demanding the power factor should be implemented after creating awareness.

Tamil Nadu Small and Tiny Industries Association (TANSTIA) president CK Mohan said the change in the power factor imposition on the LT consumers without connected load caps would affect mainly the lathe, welding and fabrication units.

Activist S Neelakanta Pillai questioned how the TNERC made such a change in the regulation impacting thousands of consumers without seeking comments on it. “The commission should have created awareness among consumers on how to avoid penalties. But the commission has issued such an order imposing penalties amounting to 40 per cent and 50 per cent of total consumption charges,” he said.

A senior Tangedco official said that following the order issued by the TNERC, they have to implement the power factor norm.