Tamil Nadu MSMEs Hit by Rising Electricity Charges, Solar Energy Restrictions

Chennai, Sep 16 (KNN) In a significant development for the micro, small, and medium enterprises (MSMEs) of Tamil Nadu, the Tamil Nadu Electricity Board (TNEB) has reintroduced higher network charges, raising concerns across the state's industrial sector.

The Tamil Nadu Association of Cottage and Enterprises (TACT) has voiced its apprehension over this change, stating that the increased rates could severely impact the competitiveness of MSMEs.

J. James, a spokesperson for TACT, explained, "After prolonged demands and protests about the electricity board (EB) charges, TNEB had reduced the network charge for MSMEs by 50 per cent, from Rs 1.53 to Rs 0.76 per unit (kWh), in December 2023. However, the relief was short-lived, as the network charge has been increased to Rs 1.59 per unit from July 2024."

This sharp rise in electricity rates comes at a time when MSMEs are already grappling with cost pressures, affecting their ability to stay afloat. According to industry leaders, the hike further intensifies the burden on the struggling sector.

S. Surulivel, president of the Coimbatore SIDCO Industrial Estate Manufacturers Welfare Association (COSIEMA), noted, "MSMEs are already struggling to pay electricity charges due to severe hikes.

As an alternative, some businesses have looked to solar energy systems. However, the wheeling charges, levied on transferring solar-generated electricity to the grid, are discouraging."

Surulivel acknowledged that wheeling charges are reasonable when industries export surplus solar energy to the grid, particularly during non-operational days, but he urged that these charges be abolished when industries immediately use the energy generated from rooftop solar systems. "It’s unfair to impose wheeling charges on energy that is self-consumed. This policy discourages clean energy adoption," he added.

Adding to the challenges, M. Raja, president of the Tamil Nadu Solar Power Generators Association, highlighted that TNEB's restrictions on solar energy usage are counterproductive. "Currently, TNEB does not permit carry-forward methods in solar energy utilisation.

This means the energy generated must be consumed within the same month, limiting the flexibility and cost-saving potential of solar power for businesses."

With mounting concerns about rising operational costs and restricted access to renewable energy benefits, MSME leaders across Tamil Nadu are demanding urgent reforms from the state government and TNEB to create a more sustainable environment for their operations.

(KNN Bureau)