Tamil Nadu rules out electricity tariff hike as power sector debt hits ₹2.47 lakh crore

On Thursday, June 25, 2026, Tamil Nadu Electricity Minister R. Nirmalkumar announced in Chennai that the state will not implement any electricity tariff revision this year, including the scheduled annual 3.57% hike. The announcement came during the presentation of a White Paper revealing that the state's four power corporations have accumulated a total debt of ₹2.47 lakh crore.

The debt spans the Tamil Nadu Power Distribution Corporation Limited (TNPDCL), Tamil Nadu Power Generation Corporation Limited (TNPGCL), Tamil Nadu Green Energy Corporation Limited (TNGECL), and TANTRANSCO. The White Paper highlighted severe deficiencies in electricity infrastructure, power generation, and manpower across the state.

According to the report, Tamil Nadu faces a critical gap between its peak power demand of over 21,300 MW and its own generation capacity of just 3,495 MW. This own-source capacity consists of 2,965 MW of thermal power, 381 MW of hydropower, and 149 MW of gas-based power. Minister Nirmalkumar stated that previous governments met this shortfall through expensive external power purchases, which sometimes cost up to ₹17 per unit in the exchange market.

The Minister also noted delays in key power projects. Out of four major thermal power projects announced years ago, only the Ennore SEZ and Udangudi Stage-I projects are currently in progress. The previous administration discontinued the other two projects, ETPS Expansion and Uppur, after spending more than ₹8,700 crore.

Infrastructure development also slowed down, with only 122 substations commissioned between 2021 and 2026, compared to 359 between 2016 and 2021. Additionally, an investigation is underway into an alleged procurement scam involving 45,800 distribution transformers.

To address a 45% manpower shortage—amounting to 65,921 vacancies—the department plans to recruit 15,000 personnel this year and absorb 5,391 gangmen, following directives from Chief Minister C. Joseph Vijay. The state also proposes to renovate 682 substations for ₹8,318 crore and build 231 new substations.