Tariff shock to power users by 4.7% likely from July 1

CHENNAI: For the first time, the State is set to witness a full-fledged electricity tariff revision for successive years with the Tamil Nadu Electricity Regulatory Commission (TNERC) planning to hike the tariff from July 1 by 4.70 per cent based on the consumer price index (CPI).

The tariff revision comes just nine months after a steep hike in September last year.

In the tariff order, TNERC approved the Tamil Nadu Generation and Distribution Corporation (Tangedco) proposal to revise the tariff year-on-year on July 1 for the next four years (2023-24 to 2026-27) based on the CPI with actual annual increase capped at 6%.

TNERC sources said the quantum of hike would be arrived at based on the CPI of April this year compared with April last year’s inflation. The inflation is arrived at 4.7% which is likely to be the escalation rate to be applicable from July 1. Both energy charges and fixed/demand charges would be revised.

On whether consumers’ views would be sought, the sources said it was not needed as the commission had approved the multi-year tariff order last year. “The same methodology will be followed for the next three years (till 2026-27),” the official said.

If the tariff is hiked at 4.7%, the tariff for the domestic consumers in various slabs will go up by at least 21 paise to 51 paise per unit. The common service connection in the apartments would see the energy charges going up from Rs 8 to Rs 8.37 per unit while the fixed charges will go up from Rs 200 per kilowatt for two months to Rs 209 per kw.

Activist P Viswanathan of Chitalapakkam said any hike would be a burden to public who are already reeling under the increased cost of essential items. “The hike will create resentment against the elected government, should be avoided,” he said. KE Raghunathan, national president of the Association of Indian Entrepreneurs, said the power tariff hike would directly impact all including the MSMEs.

“When MSMEs are demanding rollback of last year’s hike, the tariff is going to be hiked again. I am not able to see any rationale. The gap between the government and the people’s requirement is widening,” he said.

He also warned that the entrepreneurs would sstart migrating to other states like those going out in search of work.