Tamil Nadu Electricity Regulatory Commission (TNERC) said a letter has been written to Principal Accountant General Chennai for nomination of an audit party to carry out intensive audit of the circumstances which lead to power distribution companies continuing without recovery of regulatory assets.
The costs incurred by power distribution companies, which are not recovered in a timely manner, lead to the regulatory assets (RA).
The Supreme Court had issued broader directions to all the State Electricity Regulatory Commissions (SERCs), mandating liquidation of legacy RAs within four years. The top court has capped the creation of new RAs at 3% of the Annual Revenue Requirement (ARR). It directed the Appellate Tribunal for Electricity (Aptel) to monitor the implementation and enforce accountability on the creation and liquidation of RAs.
As per a petition filed by TNERC with the Aptel, the State power utilities’ regulatory assets stood at ₹83,000 crore.
The State government has issued an order for the restructuring and bifurcation of the Tamil Nadu Generation and Distribution Corporation Limited (Tangedco) for the formation of three companies, namely the Tamil Nadu Power Generation Corporation Limited (TNPGCL), the Tamil Nadu Green Energy Corporation Limited (TNGECL), and the Tamil Nadu Power Distribution Corporation Limited (TNPDCL), it said.
The regulatory assets quantified at ₹83,000 crore were allocated to the new companies – TNPGCL – @ 27% – i.e.,₹22,110.16 crores, TNGECL@- 2% – allocation of ₹1,851.71 crores and TNPDCL @-71% – allocation of ₹59,038 crore, TNERC said.
TNERC further said it is in discussion with the state government and TNPDCL on the liquidation of regulatory assets within the time as stipulated by the Supreme Court. On finalisation of the scheme of liquidation of the Regulatory asset of ₹59,038 crores relating to TNPDCL by the state government and the Utility, the roadmap/trajectory will be submitted, it said.
A letter has been addressed to the Principal Accountant General, Chennai, seeking their assistance for nomination of an audit party to undertake the audit regarding the issue of regulatory assets and to furnish the audit report on a time bound basis, TNERC said.
Saying hectic consultations are on with the state government and the power distribution company, TNERC sought for grant of time to settle the issue.
According to ratings firm ICRA’s estimate, the RA position at the all-India level remains elevated at ₹3 lakh crore, mainly driven by Tamil Nadu, Uttar Pradesh, Rajasthan, Maharashtra, Delhi, West Bengal, and Karnataka.
Published – November 03, 2025 05:30 am IST
