Tangedco incurred ₹245 cr. additional expenditure: CAG

Failure to factor transmission loss in energy purchase agreements led to the expense

The failure to factor in the transmission loss in the energy purchase agreements (EPAs) with solar power generators has resulted in an additional expenditure of ₹245.27 crore for Tangedco, according to the report of the Comptroller and Auditor General of India Compliance Audit for the year ending March 2020.

The audit observed that the solar power generators (SPG) did not adhere to the EPA and the CEA regulations and had not installed the meters at the inter-connection point. Tangedco failed to ensure the installation of energy accounting meters at the sub-station’s end and the payment to the SPGs were made based on the energy recorded in meters, installed at the generating end. Consequently, the transmission loss between the generating station and the pooling substation (Tangedco’s sub-station) was absorbed by Tangedco.

Accordingly, the SPGs selected through preferential tariff schemes, were paid for the total power generated without any deduction for the transmission loss. Considering the rate of transmission loss approved by TNERC from time to time, transmission loss absorbed by Tangedco during March 2015 to March 2021 worked out to 406.06 Mus. This resulted in an additional expenditure of ₹245.27 crore.

It is recommended that Tangedco may change the location of energy accounting meters to Tangedco or the Tamil Nadu Transmission Corporation (Tantransco) sub-station end immediately to avoid further loss, which may continue beyond 2040, as the present EPA if for a period of 25 years from March 2015, the CAG said.

The report said failure to revise the quantum of power allotted based on the outrage of open access generators and to restrict the adjustment to entitled quantum, resulted in excess adjustment of power to consumers, leading to a loss of ₹53.05 crore.