High power rate to make railway ‘disconnect’ TANGEDCO ties

Exorbitant tariff rates quoted by the TANGEDCO has forced the Southern Railway to look for a better deal with a public sector company to cater to its electricity needs.

Published: 03rd August 2017 01:35 AM  |   Last Updated: 03rd August 2017 08:15 AM   |  A+A-


Express News Service

COIMBATORE: The exorbitant tariff rates quoted by the Tamil Nadu Generation and Distribution Corporation (TANGEDCO) has forced the Southern Railway to look for a better deal with a public sector company to cater to its electricity needs.

Tangedco’s Rs 8.12 per unit tariff for power used by the Railway in the State is said to be quite high, not just against the rate offered by public sector companies, but by other governments too.
“The average cost of electricity in Kerala is Rs 5.70 and Rs 4.80 in Andhra Pradesh. In case of excess consumption, the penalty is 300 per cent in Tamil Nadu, wheras it is 150 and 200 per cent in Kerala and Andhra Pradesh, respectively,” said S Rama Subbu, Chief Electrical Distribution Engineer of Southern Railway, Chennai.

Much to the Railway’s relief, Ratnagiri Gas and Power Private Limited (RGPPL), jointly promoted by the National Thermal Power Corporation and GAIL (India) Limited, has come forward to offer power at Rs 5.90 per unit.

“Tangedco has made a proposal to increase power factor tariff from 0.9 to 0.95 level. Hence, it will increase our spending on electricity by another 15 per cent. So we have decided to stop procuring from Tangedco and choose RGPPL,” Rama added.

Though the decision was made last year, the Souther Railway is still awaiting a No Objection Certificate (NOC) from the State government, allowing it to procure electricity from other sources. Rama said the Railway was expecting an NOC or at least a reduction in power tariff from Tangedco on the lines of what was offered by the RGPPL.

With NOC being delayed, the Railway has brought the issue before the Tamil Nadu Electricity Regulatory Commission and Appellate Tribunal for Electricity in New Delhi. For the government, however, this move would spell a huge loss in revenue. It had been earning around Rs 750 crore for the 810 million units of power that the Southern Railway usually consumes every year.

M Saikumar, Chairman and MD of TNEB and Tangedco, however, said that he was not aware of any such proposal by the Southern Railway.

It should be noted that the Indian Railways has been procuring electricity from other sources due to high tariff of the respective State governments in Gujarat, Madhya Pradhesh, Uttar Pradesh, Delhi, Chhattisgarh and Jharkhand.

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