TNERC announces the Pooled Cost of Power Purchase for FY 2018-19

TNERC recently announced an order for the pooled cost of power purchase payable by Tangedco for FY 18-19 under TNERC (Renewable Energy Purchase Obligation) Regulations, 2010). The order has mentioned the criteria, mandatory for a renewable energy generating company for  obtaining accreditation from the state agency which are:

“(a) It does not have any power purchase agreement for the capacity related to such generation to sell electricity at a preferential tariff determined by the Commission; and

(b) It sells the electricity generated either (i) to the distribution licensee in the State of Tamil Nadu at a price not exceeding the pooled cost of power purchase, or (ii) to any other licensee or to an open access consumer at a mutually agreed price, or through power exchange at a market-determined price.”

With these specifications, the commission declared the Pooled Cost of Power Purchase payable by the TANGEDCO for the year 2018-19 as Rs.3.97 per unit subject to the maximum of 75% of the preferential tariff fixed by the Commission to that category / subcategory of NCES generators i.e. Rs.3.97 per unit or 75% of the preferential tariff fixed by the Commission to that category / subcategory of NCES generators, whichever is less. The Order came into effect from 1st April 2018.

The trend of the pooled cost of power purchase in Tamil Nadu in the past years is as given below.



TANGEDCO, in a memo dated 15/11/2017, has released  the revised rate of power purchase with respect to the wind energy REC generators from FY 2012-13.

The On REC WEGs availed Accelerated Depreciation is as follows:


On REC WEGs not availed Accelerated Depreciation:



Ind Bharath Group has filed an insolvency petition against TANGEDCO under the Insolvency and Bankruptcy code, 2016. This is due to the delay by TANGEDCO in the payment of dues of more than Rs 700 Cr. They claim that their funds are stuck in with TANGEDCO  due to which the they are unable to clear dues with their own creditors.  Chennai’s National Company Law Tribunal has been approached for the same and TANGEDCO has been given a week to file its counter.


The article about the same can be accessed here.


In an auction held yesterday in Tamil Nadu by TANGEDCO, the latest tariff which has been determined is Rs 3.42 per unit. This is lower than the tariff determined in the auction held in February and below the tariff determined under FiT mechanism. The auction was won by ReGen Powertech, Leap Green Energy and Powertech India for 200 MW, 250 MW and 50 MW capacities respectively.

Keeping in view the recent trend of cancellation of PPAs which were signed at a higher rate, the power minister Sree Piyush Goyal has requested the state utilities to honor them as this can pose a threat to the development of the projects which have already been signed. Though this falls in line with the government’s initiative to have 175 GW RE capacity by 2022, it may also prove to be counterproductive.

The article can be accessed here.

TNERC Hikes Power Tariff In the State

Cost of buying electricity from DISCOMs has become costlier for the Commercial & Industrial consumers in the state of Tamil Nadu. Considering the directives of the Hon’ble APTEL, the National Tariff Policy and in Exercise of the powers vested in it under the Section 62 and Section 64 of the Electricity Act, 2003 (Act) and the Tariff Regulations 2005, TNERC has decided to take up the matter of Determination of ARR and Tariff for 2014-15 by initiating suo-motu proceedings and based on that a public notice was issued by Tamil Nadu Electricity Regulatory Commission (TNERC) on 23/9/2014 eliciting comments &suggestion stakeholders to the proposed suo-motu revision of electricity tariff and transmission tariff.

The commission after considering all the comments & suggestions have revised the electricity tariff by 15% for all the category of consumers for FY 2014-15 effective from 12/12/2014.

 The new tariff applicable to industrial and commercial consumers for HT connections can be seen in the table below:

Group captive arrangement will still remain most viable option for the industrial & commercial consumers looking at the hike in the tariff and R&C measures still in place.

Similarly for LT consumers for all categories there has been tariff hike of 15% as can be seen in the order.

The order can be accessed here.

Contributed by karthik krishnan

TNERC Sets Aside the TN Solar Policy 2012

Tamil Nadu Electricity Regulatory Commission (TNERC) has dismissed a petition filed by Tamil Nadu Generation and Distribution Corporation (TANGEDCO) for the procurement of Solar Power through competitive bidding process. The commission notified the order on 15th Sep 2014.

The summary of the Petition and the commission’s order is stated in points below:

  • TENGEDCO through a petition requested before the commission to approve the purchase of Solar Power of 708 MW from 52 generators.
  • TENGEDCO also requested before commission to adopt the purchase rate Rs.5.97 (10 MW), Rs.6.15 (5 MW), Rs.6.20 (15 MW) and Rs.6.48 (678 MW) per unit arrived though competitive bidding process and to allow TANGEDCO to procure solar power from those bidders by entering into power purchase agreement for a period of 20 years.
  • TENGEDCO gave the reasons that the bidding has been done as per the Tamil Nadu Solar Policy 2012 which aims to procure 1000 MW of solar power for SPO (Solar Purchase Obligation) consumers.
  • The Commission in its findings stated that as the commission’s order on imposing SPO was struck down by APTEL (Appellate Tribunal for Electricity), so only RPO should be applicable as mandated in APTEL’s order.
  • The commission also stated that as per Tariff policy by Government of India such costly power should be procured at preferential tariff as determined by the state commission.
  • By giving the above stated reasons the commission dismissed the petition of the TENGEDCO saying that the said bidding process of TANGEDCO for procurement of solar power has no legal sanctity for consideration.

The TNERC order can be accessed here.

Our previous blog post on TNERC Solar tariff can be read here.

Contributed by Dheeraj Babariya

TN Govt. Approaches Supreme Court against APTEL Order

Tamil Nadu Government has filed a petition in Supreme Court against the order of the Appellate Tribunal for Electricity (APTEL) dated 21st January 2014. The order says that state government cannot specify solar power obligation (SPO) for special category of consumers (applicable for all obligated entities except TANGEDCO), when there already exists Renewable Purchase Obligation (RPO) for the consumers in the state.

Background – The Govt. of Tamil Nadu drafted its solar policy (announced in 2012), mandating certain consumer to buy solar power, which was finalized by the Tamil Nadu Electricity Regulatory Commission (TNERC) in its order dated 7th March 2013. The order stated that – “As prescribed in the Solar Policy, 6% SPO starting with 3% SPO till December 2013 and 6% from January 2014 is applicable”.

The Tamil Nadu Spinning Mills Association appealed to APTEL for the removal of the Solar Purchase Obligation as RPO does mandate purchase of solar power.

The APTEL in its judgment said that the state commission cannot impose any other obligation such as SPO, as RPO already exists in the state. So the State Govt. has moved to the Supreme Court challenging this , as it clearly intends to impose SPO under its Solar Policy.

It is also worth noting that TNERC has mandated RE purchase to a total of 9% under its RPO regulation, which is one of the highest in India, with 0.05% Solar RPO and 8.95% Non-Solar RPO. The commission in its draft RPO Regulation 2014, has increased the solar RPO to 2% and total to 11%, to bolster Solar Power in the state in case SPO is not implemented.

Our Previous Blog Post on the same matter can be read here.

The recent media Article can be read here.

Preceding APTEL Order is available here.

Contributed by Dheeraj Babariya.

Wind producers in TN favouring power forecasting & scheduling

As per an article in The Hindu, Tamil Nadu a leader in wind power generation (installed capacity of around 7200 MW) in the country has, off late, been disappointing its wind power producers. TN’s state distribution company (TANGEDCO) has been shying away from purchasing power generated from these generators owing to poor evacuation facility and a “Banking” clause which empowers generators to claim the power previously injected into the grid.

Wind power producers have been making huge losses as TANGEDCO continues to discard the power that is being generated from these wind machines. But a positive side as a consequence of this, seems to be tilting in favour of forecasting & scheduling. Hon’ble CERC had recently barred all commercial settlements envisaged under the RRF mechanism.

Wind power producers (in same article) are betting on forecasting & scheduling to serve as a saviour for them. They say that an estimated declaration of power to be injected, beforehand, is expected to address most issues of TANGEDCO.

More on RRF mechanism can be learned by visiting the following links –

Link 1

Link 2

Link 3

Tamil Nadu drafts RPO targets for FY15 & FY16

Tamil Nadu Electricity Regulatory Commission (TNERC) recently issued a draft order on RPO targets for FY15 & FY16. The following are the targets proposed by the commission: 

Column 1 Column 2 Column 3
Year Minimum quantum of total renewable purchase obligation in %age ( in terms of energy in kWh) Minimum quantum of solar renewable purchase obligation in %age out of total renewable purchase obligation mentioned in Column 2 (in terms of energy in kWh)
2014-15 11.00% 2.00%
2015-16 11.00% 2.00%

This implies that obligated entities (Distribution Licensees only)  in Tamil Nadu will now have to consume a minimum of 9% of non-solar power/RECs and 2% of solar power/RECs to comply with RPO targets in FY15 and FY16. The order is yet to be finalised and comments on the same have been invited no later than 24.02.2014.  

Solar RPO target is a highlight as it has been taken up from currently 0.05 % to 2 %. This shows TN’s strong commitment towards fostering solar generation in the state. Given the fact that a recent judgement by ApTel had set aside state’s ambitious solar policy (for a relevant blogpost – click here), this particular step from TNERC is laudable.

Present draft order can be accessed here.

Previous final RPO order can read by clicking here.

ApTel sets aside Tamil Nadu Solar policy

As per reports, Tamil Nadu’s ambitious solar policy, once assumed to be a game-changer for fostering solar power in the state, has been set aside by the Appellate Tribunal of Electricity (ApTel). A capacity addition of 3000 MW was envisaged under the solar policy till 2015.

“Solar Purchase Obligation (SPO)”; policy’s main driver of demand, has been confronted with a lot of criticism. Various consumer associations had approached relevant forums against such a binding mandate which required solar energy consumption to be 6% (from Jan 2014) out of total energy consumption. According to an article in The Hindu (dated July 7th 2013), Tamil Nadu Electricity Consumers Association (TECA) went to ApTel in June 2013, saying that consumers will not have the required solar energy capacity. According to submissions in the present order by the appellants, TN requires an installed solar capacity 720 MW in the year 2013 and 1500 MW in 2014, to make solar power available for compliance with SPO and RPO targets.

TANGEDCO as a respondent in the order has said that solar RPO of 0.05 % ceased from being into effect from the time SPO was introduced by the state commission.

TANGEDCO, last year, had floated tenders which has currently around 700 MW of solar projects awaiting execution of power purchase agreements. The solar power price discovered through, competitive bidding mechanism,was Rs. 6.48 per unit. Following this recent ApTel order, TANGEDCO is in a fix whether to scrap solar power purchase obligation or to buy power from solar projects and subsequently move TNERC to raise tariffs, to accommodate additional cost of buying costlier solar power.

A copy of this order can be found here.

Media Articles are available in the following links-

The Hindu Businessline

The Hindu  – (dated 6th Nov 2012)

Our relevant blogpost can be read here.

Link to Tamil Nadu’s Solar Policy 2012

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