Tangedco to procure 1,000 MW at Rs 3.26 per unit for 3 years

The Power Ministry has issued a guideline to facilitate procurement of power of 2,500 MW for three years under the “Pilot II scheme.” Tangedco has already obtained approval of the TNERC for the procurement of 500 MW power and now seeking approval for the additional quantum of 1,000 MW.

In its petition to TNERC, Tangedco noted that the ongoing projects at Ennore SEZ, Udangudi, Uppur and ETPS expansion are getting delayed and expected to be commissioned beyond the forecast period of 2022-23. 

Moreover, after the gradual lifting of COVID-19 lockdown restrictions, Tangedco’s power demand has been increasing and at present, the deficit during peak hours or any outages of generating units are met through hydel power or purchasing power from the power exchange, it added.

The projected power deficit in the wake of the delay in the power projects stands at 1,856 MW in 2021-22 and 2,733 MW in 2022-23. It goes further up in 2023-24 to 2,856 MW and 1,241 MW in 2024-25.

Pointing to the rising variable cost of the power being purchased through the long term agreement, Tangedco said that the present total tariff for the interstate generators is in the range of Rs 4.22 to Rs 4.75 per unit and for intrastate generators in the range of Rs 5.24 to Rs 6.29 per unit. 

“Rise in coal price, the introduction of new/increase in tax has resulted in the payment of compensation under a change in the law. By which, the present variable cost has increased from the commencement to date in the range of Rs 0.07 to Rs 0.36 per unit and is likely to increase till the expiry date,” it said, adding that considering it, with a view to minimising the purchase cost, scheduling of expensive power to an extent of 1,000 MW can be limited under long term by tying up of equivalent quantum of power under the pilot scheme II at Rs 3.26 per unit.

TNERC approved the procurement of 1,000 MW power at the rate of Rs 3.26 per unit. Pointing to the 500 MW power purchase approval given in 2020, it warned that inordinate delay in availing cheaper power would be visited with penal consequences.