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<p>The Tamil Nadu Electricity Regulatory Commission (TNERC) has fixed the pooled cost of power purchases for Tamil Nadu Generation and Distribution Corporation (TANGEDCO) at ₹3.70 (~$0.056)/kWh for the financial year (FY) 2017-18. The cost applies to all purchases made from April 1, 2017.</p>
<p>In a letter addressing the announcement, TNERC clarified that the pooled cost of power is ₹3.70 (~$0.056)/kWh or 75 percent of the preferential tariff fixed by the commission for that category or sub-category of NCES generators, whichever is less. The preferential tariff is the tariff of choice for state PPAs and can be much lower than the generic tariff.</p>
<p>For FY 2016-17, TNERC had set ₹3.96 (~$0.060)/kWh or 75 percent of the preferential tariff fixed by the commission for that category as the pooled cost of power purchases payable by TANGEDCO. The current cost is ₹0.26 (~$0.004)/kWh, about 7 percent less than in the previous year.</p>
<p>The pooled cost of power payable by TANGEDCO has fluctuated over the past three fiscal years. In FY 2015-16 it was ₹3.35 (~$0.051)/kWh, rising to ₹3.96 (~$0.060)/kWh in FY 2016-17, then falling to ₹3.70 (~$0.056)/kWh this fiscal year.</p>
<p>When asked about the rise and fall of the pooled power cost, a TNERC official said, “The average pooled power cost depends on the sources of power purchased (high cost versus low cost) and demand. If the distribution company (DISCOM) purchases more low-cost power over a period of time, then the pooled power cost for the next year will go down. The commission analyzes real-time data to arrive at the pooled power purchase cost.”</p>
<p>“As has been happening in the past two years, the DISCOM is buying more of low-cost power (from solar wind farms and other sources) and entering into long-term power purchase agreements (PPAs), thereby reducing cost and at the same time demand has not increased much. In such a scenario, it’s easy for them to purchase low-cost power as there is no immediate requirement forcing them to buy high-cost power to supply an increasing number of customers,” added the TNERC official.</p>
<p>TANGEDCO recently <a href="https://mercomindia.com/tangedco-finally-signs-ppas-1500-mw-solar-tamil-nadu/" target="_blank" rel="noopener">signed PPAs</a> for 1,500 MW of solar projects at ₹3.47 (~$0.0537)/kWh, contributing to the lower pooled cost of power purchases. Tamil Nadu is expected to auction solar projects with ₹3 (~$0.0457)/kWh as the benchmark tariff in the near future.</p>
<p>Image credit: Flickr</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/saumy/" class="vcard author" rel="author"><span class="fn">Saumy Prateek</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/12/saumy-edited-1.png" width="50" /></p>
<p><strong style="text-decoration: underline">Saumy Prateek</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/saumy/" target="_blank" rel="noopener">More articles from Saumy Prateek</a></p>
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<div class="authorboxn"><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/12/saumy-edited-1.png" width="79" height="102" /><a href="https://mercomindia.com/author/saumy/" rel="noopener"><strong>Saumy Prateek, </strong> </a>is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism &amp; Mass Communication from the Manipal Institute of Communication at Manipal University.<a href="https://mercomindia.com/author/saumy/">More articles from Saumy Prateek.</a></div>
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Solar Lowers TANGEDCO’s Pooled Cost of Power Purchases to ₹3.70/kWh

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