The Tamil Nadu Electricity Regulatory Commission (TNERC), in its new tariff order, has increased the retail tariffs for the financial year (FY) 2023-24.

The Commission has increased the retail electricity tariff for high tension (HT) industrial consumers by 2.2% to ₹6.90 (~$0.084)/kWh from the earlier ₹6.75 (~$0.082)/kWh. Similarly, the retail tariff for commercial consumers has been increased by 2.4% to ₹8.70 (~$0.11)/kWh from ₹8.50 (~$0.10)/kWh.

In September last year, the Commission announced the multi-year tariff trajectory for FY24 to FY27, approving a 6% annual tariff hike.

The recent hike, however, is in the range of 2.2-2.5%.

According to the new tariff order, the wheeling charge for the high tension (HT) consumers has been set as ₹1 (~$0.01)/kWh for FY24. The wheeling charge for HT consumers was ₹1.04 (~$0.013)/kWh for FY23.

Also, the cross-subsidy surcharge for HT industrial consumers has been set at ₹1.86 (~$0.023)/kWh, whereas for HT commercial consumers, the cross-subsidy surcharge is ₹2.41 (~$0.029)/kWh. The cross-subsidy surcharge for HT industrial consumers was ₹1.79 (~$0.021)/kWh and ₹2.33 (~$0.028)/kWh for HT commercial consumers in  23.

The new tariffs are applicable from July 1, 2023.

In 2022, TANGEDCO filed the petition for the approval of true-up from FY17 to FY21 and the determination of tariff for the generation and distribution of electricity for FY23 to FY27. The petition was scrutinized and reviewed, and the Commission passed the seventh order on September 09, 2022.

In the last tariff order of TANGEDCO, the Commission had stated that an inflation-indexed approach for the computation of tariffs should be taken into account, considering the annual increase in the average cost of supply.

Looking at the past trends, the state regulator had opted for the Consumer Price Inflation (CPI) index, as the past annual CPI inflation rates were in the range of 4.9-6.3% between 2018 and 2022. However, the Commission noted that the actual annual increase should be capped at 6%, irrespective of CPI inflation.

The Commission had noted that it would adopt the CPI index of April 2023 compared with the CPI index of April 2022 to arrive at the escalation rate of 6%, whichever is lower, and revise the tariff schedule.

Though it was decided to adopt the escalation rate comparing April 2023 and April 2022 for the tariff revision to take effect from July 1, 2023, the Commission decided to compare the general CPI Index of April 2023 with the index for August 2022. Accordingly, the prevailing tariff has been escalated to the extent of such a percentage comparing the index rate prevailing in August 2022.

The various categories of HT consumers are –  HT IA: HT- industry; HT IIA: Government Educational Institutes; HT-IIB: Private Educational Institutes, HT III-HT Commercial; and HT IV-Temporary Supply.

Further, the Commission has added that in case of supply under HT I, HT IIA, HT IIB, and HT III categories of renewable energy with necessary renewable energy certificates (RECs) by specific request from the consumers will be charged at 110% of the approved tariff for the respective category.

Electric Vehicle Charging

The Commission has set a tariff for ₹9 (~$0.11)/kWh for public electric vehicle (EV) charging stations from 6 am to 9 am and from 6 pm to 10 pm for FY24.

For 9 am to 4 pm, the tariff will be ₹6 (~$0.073)/kWh, and for 4 pm to 6 pm and 10 pm to 6 am, the tariff is ₹7.50 (~$0.092)/kWh. The demand charge would be ₹138 (~$1.68)/kVA per month for FY24.

If the consumer uses the supply for charging EVs at his premises, the tariff applicable will be as per the category of such premises.

Tamil Nadu has hiked its retail tariff, making open access solar a go-to option for the textile and chemical industries, which are also high-energy consumers in the state.

Tamil Nadu accounted for 8% of the total open access installations in the first quarter (Q1) of 2023, trailing Karnataka and Maharashtra. The numbers were revealed in Q1 2023 Mercom India Solar Open Access Market Report.

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