TNPDCL to purchase 1,500 MW electricity to avoid peak hour shortages during summer

The Tamil Nadu Power Distribution Corporation Limited (TNPDCL) will soon be floating a tender for procuring 1,500-megawatt (MW) power under a medium-term contract to prevent purchasing of high-cost electricity during summer.  

The tendering process comes in the wake of the Tamil Nadu Electricity Regulatory Commission (TNERC), in its order, allowing the TNPDCL to float a single medium-term tender for a period of five years to procure 1,500 MW electricity based on the finance, own, and operate guidelines. 

In the affidavit submitted to the TNERC, the Electricity Department had cited various reasons for seeking special permission to facilitate the purchase of the electricity, like the high cost incurred for purchasing 1,000 MW during peak hours in 2023-24. Other reasons were – to meet the resource adequacy guidelines of Central Electricity Authority (CEA), and a shortfall of nearly 4,500 MW expected in the next two years. 

The TNPDCL cited the data of the CEA’s report and the demand and consumption records, to find a shortfall in electricity during peak evening hours starting from 6 p.m. 

The data of the TNPDCL shows that the projected peak demand this year is expected to be nearly 23,000 MW, while the peak demand recorded was 20,830 MW and the consumption of 454.32 million units were touched in the State in April 2024.  

Though the State has a renewable energy capacity of 22,000 MW with wind and solar power generation, they have remained unpredictable. Hence, to ensure that the TNPDCL have adequate resources to meet any surge in demand as projected by CEA during peak hours, the Electricity Department wants to have a steady source of thermal energy.

As per the order issued by TNERC, the TNPDCL would be floating tender under medium-term through tariff-based competitive bidding route, according to the guidelines issued by the Union Ministry of Power.