TNPDCL Excludes Gas-Based Power Plants from New Electricity Tender

The Tamil Nadu Power Distribution Corporation Limited (TNPDCL) has excluded gas-based power generating stations from its fifth short-term electricity procurement tender in an effort to avoid high-cost power purchases. The decision follows controversy over earlier bids that quoted electricity prices as high as ₹41.50 per unit.

Instead, TNPDCL has restricted the latest tender to coal-based thermal power plants, aiming to control electricity procurement costs and ensure an adequate power supply during the upcoming summer season.

TNPDCL`s Fifth Power Procurement Tender: Key Details

The latest tender, issued on November 1, 2026, seeks to procure round-the-clock (RTC) electricity between January 18 and June 15, 2027.

TNPDCL has planned different procurement quantities to meet the state`s expected electricity demand during the summer months.

The proposed power procurement requirements are:

The advance procurement process is intended to help Tamil Nadu meet peak summer electricity demand without depending on expensive last-minute power purchases.

Gas-Based Power Plants Excluded from TNPDCL Tender

One of the major changes in the fifth short-term power procurement tender is the exclusion of gas-based electricity generating stations.

Earlier tenders allowed participation from different power generation sources. However, some gas-based power stations submitted significantly higher quotations, contributing to concerns over the cost of purchasing electricity from the short-term market.

Previous bids reportedly reached ₹37 per unit and ₹41.50 per unit.

To avoid such expensive offers, TNPDCL has now restricted eligible power supplies to coal-based thermal generating stations.

Both interstate and intrastate power generators, as well as licensed electricity traders, can participate, provided the electricity is sourced exclusively from coal-based thermal plants.

The minimum bid quantity has been fixed at 20 MW per source, with electricity delivery required at Tamil Nadu`s state boundary.

TNPDCL Changes Power Procurement Conditions

The latest tender also introduces another significant change in procurement conditions.

Unlike previous tenders, which required participants to submit offers for both peak-hour and round-the-clock power arrangements, the fifth tender focuses exclusively on RTC electricity.

Earlier, generators and electricity traders had to participate in both categories. The peak-hour power offered was also required to be at least 60% of the RTC power quantity.

By removing this condition, TNPDCL has simplified the procurement structure and focused on securing a continuous electricity supply.

Earlier Tamil Nadu Power Tenders Received High Bids

The decision to exclude gas-based power plants follows high quotations received in previous short-term electricity procurement tenders.

The earlier tenders recorded the following maximum quoted rates:

First tender: Up to ₹37 per unit for peak-hour and night-time electricity supply between October 12 and 31.

Second tender: Up to ₹41.50 per unit for 1,000 MW of peak-hour power between November 2026 and May 2027.

Third tender: Up to ₹35 per unit for peak-hour, round-the-clock and night-time electricity supply between November 2026 and January 2027.

The status of the fourth tender, which sought round-the-clock and peak-hour electricity between February and July 2027, has not yet been disclosed.

Tamil Nadu Prepares for Summer Electricity Demand

With electricity consumption expected to rise during the summer months, TNPDCL is taking advance steps to secure sufficient power for the state.

The latest coal-based power procurement strategy is intended to reduce exposure to expensive short-term electricity offers while ensuring a reliable supply for households, industries and commercial establishments.

The outcome of the fifth tender will be important in determining how effectively Tamil Nadu can manage its summer electricity requirements and control power procurement expenses in 2027.