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| 'TN losing Rs 1,440 cr due to free power supply to farmers' |
| Press Trust of India / Chennai Aug 27, 2009, 13:56 IST |
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Tamil Nadu has been incurring a loss of Rs 1,140 crore per year on account of providing free power supply to the agriculture sector, according to an Assocham study.
The state government's policy of providing free power 14 hours a day to the sector, with 3.14 lakh energised irrigation pumpsets is leading to the losses, it said.
The study raised questions on who should pay for the losses when the State Electricity Board was finding it difficult to meet the demand-supply gap for power.
In addition, the cost of producing one unit of power was 'exorbitant' compared to Andhra Pradesh and Maharashtra, leading to a reduction in 'competitiveness' of industries in the state.
The industrial sector, already paying steep charges for power, is unable to get 24-hour power, it said.
According to estimates, the state government faced 4.9 per cent shortage in power supply for the April-July 2008-09 period.
The study said total installed capacity for electricity in Tamil Nadu was 14,300 Mw and that an additional generating capacity of about 4,000 Mw was in the pipeline.
Tamil Nadu, considered one of the better Southern states in terms of power supply, had a 3.8 per cent deficit in the first quarter of fiscal 2009-10, it said.
The study suggested that the agriculture sector be charged a minimal amount and that the tariff be 'rationalised' and made affordable to small powerloom operators.
In addition, to enhance renewable energy sources, the government should quickly commission new projects outlined in the Budget, it said.
The study also called on the corporate sector to take advantage of the government's incentives and schemes for expansion by way of utilising wind and solar energy.
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