The Tamil Nadu Electricity Regulatory Commission (TNERC) has issued an order setting the additional surcharge for open access consumers at ₹0.54 (~$0.0063)/kWh, effective from December 12, 2024, until March 31, 2025.

The additional surcharge is applicable to open access power consumers purchasing power through third party sale and power exchanges. The additional surcharge applicable to such consumers from April 1, 2024, to August 7, 2024, was ₹0.34 (~$0.0039)/kWh and ₹0.29 (~$0.0033)/kWh between August 8, 2024, and September 30, 2024. The additional surcharge was exempted for all open access consumers from April 1, 2023, to September 30, 2023.

This decision follows a petition by the Tamil Nadu Power Distribution Corporation (TNPDCL), which initially sought a surcharge of ₹1.06 (~$0.0124)/kWh to cover fixed costs due to stranded power purchase commitments.

Background

TNPDCL filed a petition seeking an additional surcharge of ₹1.06 (~$0.0124)/kWh between October 1, 2024, and March 31, 2025.

This petition was grounded in Section 42(4) of the Electricity Act, 2003, which mandates open access consumers to pay an additional surcharge to cover the fixed costs incurred by distribution licensees due to stranded power purchase commitments.

TNPDCL reported a total contracted capacity of 23,628.83 MW.

Tamil Nadu’s maximum power demand during the financial year (FY) 2024 was 19,409 MW, with an average daily consumption of 426.439 million units.

The petition was filed under TNERC’s Grid Connectivity and Intra-State Open Access Regulations, 2014, which stipulate that additional surcharges apply if power purchase commitments are stranded.

TNPDCL provided extensive data from October 2023 to March 2024 to support its request.

The points considered to ascertain the additional surcharge included:

• Stranded Capacity: The average stranded capacity was calculated at 687.42 MW.
• Fixed Costs: The total fixed charges for the period were ₹87.91 billion (~$1.036 billion).
• Stakeholder Feedback: TNPDCL received and responded to stakeholder comments as part of the regulatory process.

Commission Analysis

TNERC conducted a detailed analysis to determine the additional surcharge payable by open access consumers, as filed by TNPDCL. The analysis was based on the data from October 2023 to March 2024 and applies to the period from October 2024 to March 2025.

TNPDCL’s petition included detailed calculations of fixed costs and stranded capacity. The commission scrutinized these calculations, focusing on the fixed costs from the Tamil Nadu Power Generation Corporation and the Tamil Nadu Green Energy Corporation generating stations and other power sources. The total fixed cost approved was ₹(~$1.036 billion), slightly higher than TNPDCL’s claim.

The stranded capacity due to open-access consumers was determined using detailed 15-minute block-wise data, resulting in an average stranded capacity of 290.17 MW.

Based on this calculation, the additional surcharge was calculated at ₹1.07 (~$0.0124)/kWh but was reduced to ₹0.54 (~$0.0063)/kWh to align with regulatory provisions and stakeholder interests.

The surcharge applies only to the electricity drawn by open-access consumers. Future petitions for additional surcharge will be required every six months, with detailed data submissions mandated for transparency and accuracy in calculations.

According to Mercom’s Q3 2024 India Solar Open Access Market Report, Tamil Nadu added a record solar open access capacity in the first nine months (9M) of the calendar year (CY) 2024, surpassing the annual capacity additions of the previous years.

Mercom’s solar open access tracker provides all vital project details for installed and pipeline captive, group captive, third-party, and projects under solar parks in the country.