TN industry sore over ‘unequal’ power cuts
Rakesh Kumar Kubde
March 31st, 2012

Share and share alike – even if it is a shortage. That seems to be the sentiment among the industries in the small, medium and micro segments demanding the equal sharing of the power shortage distress across the State and across sectors.

Why should Chennai or units close to Chennai get a preferential treatment while their counterparts in the industrial hubs in the West and South Tamil Nadu bear the brunt of the shortage ask industry representatives.

According to a spokesperson of the Tamil Nadu Small and Tiny Industries Association, the main representative body for the sector, equal sharing of the distress situation will help the units elsewhere to manage their operations. The power cut is more extensive than expected with units receiving intermittent supply for about 30 hours a week.

What is needed is enforcement of the power holiday. Also the State Government should consider permitting VAT set off on diesel as an incentive for industrial units to utilise the gensets.

With the tax at Rs 8.75 a litre of diesel, a unit cost of power works out to about Rs 19. But with the set off, the power cost would come down to Rs 15 and the industrial units will use the 1,500 MW of generator capacity that is now being allowed to idle.

Mr Manikam Ramaswami, Chairman and Managing Director, Loyal Textiles, and an industry representative, says if it is two-hour power cut for Chennai, it is seven-eight hours for other cities and towns. A one hour increase in power cut in Chennai will bring down by two hours the power cut for rest of Tamil Nadu. The State Government should remove this discrimination and distribute the power shortage equally.

This will correct a ‘four-year-old’ mistake. “Every new power plant that the Government hopes to expedite will bring uniform joy to all,” he said in a statement. Huge production capacities are idling in the medium, small and tiny sector in West and South Tamil Nadu, these are under threat of going out of business.


The power cost for large sections of the industry such as information technology units, corporate hospitals, flour mills, automobile and component industries is just a fraction of their total cost. Core sectors such as steel and cement have captive coal-based power.

But the worst affected by the power cuts are the textile and the engineering sector.

The textile sector operates on a 2-5 per cent margin and the power cost accounts for 12 per cent of its turnover. The power short fall is more than 70 per cent of its requirement. It is unviable for the industry to buy power on the exchanges.
Source: BL

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2 Responses to TN industry sore over ‘unequal’ power cuts

  1. rajat says:

    please include the date of article posting above the article for better reference..

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