Tangedco reduces losses by 54 per cent to Rs 5,796 crore in 2015-16

Chennai: The debt-ridden Tamil Nadu Generation and Distribution Company (Tangedco) has brought down its losses by 54 percent to Rs 5,786 crore in the 2015-16 after cutting down on high cost power purchase, increasing sale of power and bringing down cost of generation.

According to Tangedco sources, the audited financial accounts of Tangedco for 2015-16 was finalised and submitted to the Tamil Nadu Electricity Regulatory Commission. The utility losses have come down from Rs 12,756 crore in 2014-15 to Rs 5,786 crore in the last fiscal.

The discom was able to reduce its losses in the last fiscal year without tariff hike by cutting  down on the high cost power purchase from private power producers, bringing down generation cost, enhancing generation from its own units and increase in the sale of power to consumers.

After lifting of the restriction and control measures imposed on the high tension consumers since June last year, Tangedco was meeting the full demand of power in the state which has resulted in the sale of power from 76.8 million units in 2014-15 to 79.5 MUs in 2015-16, sources said, adding that this has helped increase revenue from sale of power from Rs 35,072 crore to Rs 41,515 crore in the corresponding period.

Besides, the generation cost in its own thermal power plant has been brought down by Rs 1,000 crore to Rs 8,700 crore in 2015-16. The official said that this was made possible by increased usage of domestic coal and reduction in the cost of imported coal through tough negotiations. Moreover, the utility had kept a tab over all the operation cost too, the official added.

The conscious decision taken by Tangedco management headed by chairman M.Saikumar not to purchase high cost power from Independent Power Producers has helped save Rs 2,400 crore in the last fiscal year. In the 2014-15, Tangedco had purchased high cost power amounting to Rs 2,965 crore from three IIPs but it was reduced to Rs 536 crore in 2015-16 including fixed charged paid to the private gas based units.

The discom was able to bring down the line losses from 17.93 per cent in 2014-15 to 16.02 per cent in 2015-16. Tangedco's accumulated loss stands at Rs 55,700 crore as on March 31, 2016. Tangedco sources said that the utility would be able achieve break even in two years time if it keeps the momentum.