CHENNAI: Tamil Nadu Power Distribution Corporation Ltd (TNPDCL) has decided to procure short-term power for the January-June 2027 period at rates ranging from Rs 9.50 to Rs 13 per unit, Electricity Resources Minister R Nirmalkumar said on Friday. Announcing the outcome of the fifth short-term power procurement tender, he said the utility would purchase electricity at the lowest quoted rates for each month.

The tender, floated on November 1 for round-the-clock (RTC) supply between January 18 and June 15, attracted bids ranging from Rs 9.50 to Rs 20 per unit. The lowest rates selected for procurement were Rs 13 per unit for January, Rs 9.50 for February, Rs 10 each for March and April, Rs 9.95 for May and Rs 13 for June.

However, the response from generators fell significantly short of TNPDCL's requirements. The utility received only 81 MW against 2,000 MW sought for the second half of January, meeting 4.1% of its requirement. February saw the best response, with 1,381 MW offered against 3,000 MW sought, or 46%.

Offers met 42.8% of the requirement for March, 37.7% for April and 36.8% for May. For the first half of June, generators offered only 181 MW against 2,500 MW sought, meeting 7.2% of the requirement.

The shortfall assumes significance as the state's projected evening peak power deficit is expected to rise from 1,388 MW in January to 5,544 MW in April 2027. The deficit is projected at 3,987 MW in May and 4,796 MW in June, increasing pressure on TNPDCL to secure additional supplies.

The coal-only sourcing condition was introduced after the first three short-term tenders attracted bids of up to Rs 37, Rs 41.50 and Rs 35 per unit, respectively. Higher quotes from gas-based generators prompted the utility to restrict eligible sources. The fourth tender was subsequently cancelled.

Unlike earlier tenders, which sought both peak-hour and RTC power, the latest tender invited bids only for RTC supply. Interstate and intrastate generators and licensed traders were eligible, provided the electricity was sourced exclusively from coal-based thermal plants.

Meanwhile, TNPDCL has floated a tender to appoint a consultant to formulate its long-term power procurement strategy. The consultant will assess future demand, review existing and proposed procurement arrangements and recommend the quantum of electricity to be sourced over the coming years. The exercise will also consider additions and retirements of thermal power capacity, transmission availability for importing electricity from other states and the cost of different procurement options.

TNPDCL currently procures 2,830 MW from 11 generators under long-term agreements. Contracts with nine generators expire on September 30, 2028, while agreements with the remaining two, accounting for a combined 708 MW, end on March 31, 2029.

The minister said TNPDCL would soon float a tender for long-term power procurement, the first such initiative since 2014.