Yet another attempt at reducing the subsidy burden of the free power supply scheme for farmers is being made with the authorities planning to replace 20,000 grid-connected pumpsets in the State with solar-powered units.
Proposed under the Central government’s flagship scheme of making farm pumpsets into solar-powered systems under ‘Pradhan Mantri Kisan Urja Suraksha evam Utthan Mahabhiyan’ (KUSUM), the replacement will cost the farmers nothing. Instead, both the Central and State governments will bear 30% of the capital cost each. The rest will be absorbed by the financial partners of the Tamil Nadu Energy Development Agency (TEDA), the implementing agency in the State, or developers to be identified by the TEDA.
Apart from consuming energy to be produced by the proposed solar-powered plants of 11kilowatt (KW) capacity, which will be solar photo voltaic systems, farmers can sell energy to Tamil Nadu Generation and Distribution Corporation (Tangedco) or other buyers. It is for this purpose and many others that the approval of the Tamil Nadu Electricity Regulatory Commission has been sought by TEDA. As the life of each system is supposed to last 25 years, the Commission has suggested an indicative tariff (also called levellised tariff) of ₹2.09 per unit. The panel has also recommended that the farmers be paid an incentive ranging from ₹ 0.50 to ₹1 per unit, as a similar arrangement is in place in other States.
Publishing a paper on its website (http://www.tnerc.gov.in/), the panel has called for comments from stakeholders on or before October 2.
At present, the State government is providing nearly ₹4,000 crore annually towards free power supply for farmers. There are around 21.5 lakh agricultural connections, enjoying free power supply. On an average, the cost of supply, according to the Tangedco, comes to ₹8.26 per unit and the government’s subsidy covers ₹3.22 per unit, the rate as worked out by the Commission in its tariff order of August 2017.
A former official of the Tangedco said that in the event of success of the latest initiative of the government leading to all farmers converting their farm pumpsets, the State government would be able to save at least ₹2,700 crore per year. But, the key element here is that the selection of right developers, who will maintain the SPV systems properly at least for 5 years, will only ensure the sustenance of the scheme, the former official added.
