The TN government on Wednesday announced a reduction in the peak hour electricity charges for micro, small and medium enterprises (MSMEs) in the state to 15 per cent from 25 per cent. The revised tariff which had come into force from September 10 led the MSMEs to pay higher tariff during peak hour.
In a big relief for the MSME sector, peak hour electricity consumption charges have been reduced from 25 per cent to 15 per cent for low tension IIIB category.
In an order dated November 8, the government said the decision was taken after representations from the MSME sector. TNERC is to provide subsidy to Tangedco to compensate for the revenue loss.
On September 10 this year, peak hour consumption charges and fixed charges were for the first time introduced in the LT-IIIB category, which includes micro, small and medium enterprises. Peak hour charges are levied on LT-IIIB category between 6 am and 10 am and 6 pm and 10 pm.
The MSME department said that the reduction in tariff will benefit the sector, which has been a big employer and plays a crucial role in economic growth.
K E Raghunathan, chairman of the Association of Indian Entrepreneurs, said reduction of peak hour charges was not enough; they should be completely waived for LT III-B consumers.
The reduction was negligible as MSMEs would still have to pay ₹7.72 per unit compared to ₹7.87 earlier.
Raghunathan said the manifold hike in fixed charges had come as a blow to MSMEs, which were already struggling with minimal orders.
