Why in news
On July 15, the Tamil Nadu Electricity Regulatory Commission (TNERC) announced an average hike of 4.83% for domestic and all other consumers
Micro, Small, and Medium Enterprises protesting the rise in electricity tariffs
Why has the tariff been increased?
The genesis for the present revision can be traced back to the TNERC’s tariff order of September 2022 when it was decided to adopt a multi-year tariff framework, beginning from FY2022-23 to 2026-27.
At the time, the panel also decided that irrespective of the inflation rate, the actual annual increase would be capped at 6%.
Official says the increase would fetch an additional revenue of ₹2,720 crore
But the power utility was still expected to end the year with a loss of ₹12,280 crore assuming that there is no significant increase in demand during the year.
What has been the impact?
State government asserts that about one crore domestic consumers have been spared of the increase.
There is no change in the scheme for free consumption of 100 units bi-monthly for the domestic category or the free power supply scheme for huts and agriculture.
However MSMEs, which are over 25 lakh in number and provide employment to the local youth, have protested strongly against the increase, saying that it puts a heavy burden on them.
According to the segment of open end spinning mills, the higher electricity charges mean ₹25,000 additional outgo a month.
The power charges went up by ₹75,000 a month last year.
Such frequent increase in power cost is making the textile industry of Tamil Nadu “uncompetitive”
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