Regulator Approves Tamil Nadu DISCOM’s Petition to Procure Round-The-Clock Power

The Tamil Nadu Electricity Regulatory Commission (TNERC) has approved Tamil Nadu Generation and Distribution Corporation’s (TANGEDCO) petition to procure round-the-clock (RTC) power.

TANGEDCO had sought to procure 500 MW for March 2022, 1,000 MW each for April 2022 and May 2022, and 1,000 MW for the evening peak hours— 5 pm to 11 pm— from March 1, 2022 to May 20, 2022.

Background

In its petition, TANGEDCO claimed that the anticipated demand for March 2022 is 15.6 GW and April is 16 GW. However, TANGEDCO’s availability for the same period is about 13.2 GW in March and 14.6 GW in April. This leads to an additional requirement of 2.4 GW in March and 1.8 GW in April. Looking at the load forecasting given by the grid operation wing, the difference between the baseload and peak load is about 1,400 MW.

TANGEDCO stated that public exams are scheduled during the 2022 summer period, while IT firms and commercial establishments that are coming out of the pandemic lockdowns also resume their operations. With the industrial operations gaining momentum post-COVID lockdown and keeping in mind weather conditions during summer, the demand over the grid will increase significantly.

Morning peak and evening peak demand will be met through hydropower sources to the extent of 800 MW. Wind generation during the above period is likely to be available around 450 MW. Additional peak requirements will be managed through power procurement from exchanges based on the day-ahead forecast of demand and wind generation.

Last summer, TANGEDCO procured 700 MW during February 2021, 1,000 MW during March 2021, 969 MW during April 2021, and 819 MW during May 2021. In addition, TANGEDCO availed RTC power up to 350 MW during February 2021, 650 MW during March 2021, 450 MW during April 2021, and 250 MW during May 2021 under swap power arrangement.

TNERC had earlier approved the 1,000 MW RTC power procurement for March 2022 by TANGEDGO. However, out of 1,000 MW, TANGEDCO had procured only 475 MW. Hence TANGEDCO seeks to procure new power.

After finalizing the tender, TANGEDCO said it will approach the Commission for tender approval for tariff adoption.

Commission Analysis

After having observed the power availability from all the declared sources, the Commission approved TANGEDCO’s petition to procure RTC power of 500 MW for March 2022, 1,000 MW for April 2022 and 1,000 MW for May 2022, and 1,000 MW for the evening peak hours— 5 pm to 11 pm— from March 1, 2022, to May 20, 2022.

The Commission approved the deletion of the payment security clause, namely in the opening of the Letter of Credit. The Commission also approved the deletion of the contract performance guarantee clause and to release the bank guarantee and earnest money deposit after fulfilling the contractual obligations.

The Commission has allowed TANGEDCO to set the validity of the tender to 30 days from the date of the e-reverse auction process and delete the change in law clause.

TANGEDCO was also directed to file a petition for the adoption of tariffs as soon as the tender is finalized.

Round-the-clock renewable projects help overcome the intermittency associated with solar and wind and provide generation flexibility to meet peak loads of distribution companies. Previously, Mercom spoke to industry stakeholders to understand the vital role RTC projects play in shaping the renewable energy future for India.

Subscribe to Mercom’s real-time Regulatory Updates to ensure you don’t miss any critical updates from the renewable industry.