Even after the latest revision of power tariff, the Tamil Nadu Generation and Distribution Corporation (TANGEDCO) will experience a revenue gap of 69 paise per unit.
Stating this during a debate on the demands for grants of the Energy Department, Electricity Minister Natham R. Viswanathan told the Assembly on Thursday that the average rate of realisation (ARR) would be Rs.5.29 per unit against the average cost of supply (ACS) of Rs.5.98.
This year, the corporation would experience a shortfall of Rs.4,000 crore.
During 2011-2012, as per the revised estimates, the gap between the ARR and the ACS was Rs.2.41 per unit, which needed to be offset.
The TANGEDCO, one of the driving forces in the development of society, could not be purely a profit-based entity. However, in order to have a sustained growth, the organisation should be at least made revenue neutral by bridging the gap.
When the Dravida Munnetra Kazhagam demitted office, the outstanding debts of the corporation stood at Rs.53,152 crore.
Showering praise on Chief Minister Jayalalithaa for the way she handled the precarious financial condition of the power utility, the Minister said had the government wanted, it could have also chosen to go in for another Rs.50,000 crore borrowings.
He wondered whether such an act would behove of a responsible government. Through the efforts of the Chief Minister, the government institution was safeguarded.
Additional procurement of power and the inability to achieve the complete recovery of the cost of supply of Rs.6.15 per unit during 2011-2012 were responsible for the present financial deficit.
To improve its financial position, the corporation had submitted a financial restructuring plan to the Union government, indicating a road map for restoring the financial health with the support of the Centre and other financial institutions.
Last year, the State government released Rs.7,913.35 crore to the TANGEDCO: Rs.2,058.19 crore for tariff subsidy; Rs.4,100 crore – equity share capital assistance; Rs.1,000 crore – ways and means advance; Rs.455.16 crore – grants-in-aid for renewable energy incentive and Rs.300 crore – grant for cyclone ‘Thane' relief.
The grants-in-aid were to be provided by the Union government but released by the State government as ways and means advance.
