CHENNAI: With electricity demand remaining high across the state even in October, the Tamil Nadu Power Distribution Corporation Limited (TNPDCL) is procuring 181 MW of electricity generated from gas plants at a steep record high rate of Rs 37 per unit until October 31. This is the highest cost of power procurement by the discom so far.
A senior TNPDCL official told TNIE that the power utility had floated e-tenders for emergency procurement of 4,500 MW of electricity from the open market to meet the demand during peak hours recently. “However, we are unable to procure thermal power at cheaper rates. Gas-based power plants are ready to supply the required electricity, but the cost is high,” the official said.
Explaining the reasons for procuring power at higher rates, the official said the utility had to pay a fixed cost to thermal power plants as per the agreements, irrespective of whether it purchased electricity from them. In contrast, gas-based power plants offer greater flexibility, as the utility needs to pay only a nominal fixed charge of Rs 1 per unit if it decides not to purchase power.
According to the official, the power utility will procure 2,062 MW of electricity at rates ranging from Rs 31.99 to Rs 34.49 per unit from midnight on October 12 until 2 am on October 31. Another 2,001 MW will be procured at rates ranging from Rs 33.37 to Rs 37 between 6 pm (October 12) and midnight on October 31 to meet evening peak demand.
The official further said the utility had the option of avoiding power purchases if demand declines. In such cases, it would not have to pay the higher procurement cost and would instead pay only the nominal fixed charge of Rs 1 per unit, as stipulated in the arrangement.
The procurement plan comes amid sustained pressure on the state’s power supply system, with demand remaining high even after the peak summer period.
The utility has been exploring short-term purchases from the open market to bridge the gap between demand and available supply.
Officials further said that the flexible procurement arrangement would help the power utility meet peak-hour requirements while limiting its financial burden if electricity demand falls below expectations.