Tamil Nadu Textile Industry Seeks Power Tariff Reforms to Improve Competitiveness
The Southern India Spinners Association (SISPA) has urged the Tamil Nadu government to review industrial electricity tariffs and charging mechanisms, stating that rising power costs are eroding the competitiveness of the state’s textile and spinning sector.
According to SISPA, manufacturers have been burdened by increased energy charges, maximum demand charges, peak-hour tariffs, and other direct and indirect levies introduced in recent years. The association has called for a recalibration of the tariff structure based on actual power utilisation levels in factories to reduce production costs.
SISPA highlighted that fixed electricity charges have increased from ₹350 per kW to ₹650 per kW, making Tamil Nadu’s fixed charges among the highest in the country. It also pointed out that peak-hour duration has been extended from eight hours to ten hours per day, increasing operational expenses for continuous-process spinning mills.
The association noted that electricity tariffs in Tamil Nadu are currently higher than those in competing manufacturing states such as Gujarat and Maharashtra, reducing the state’s cost competitiveness. It warned that tariff reforms are essential for Tamil Nadu to maintain its leadership in the textile industry and compete effectively with countries like Bangladesh and China.
In addition, SISPA has sought a review of maximum demand and peak-hour charge frameworks for continuous production units. It also demanded the removal of the ₹1 per unit network charge imposed on rooftop solar power projects, arguing that the move would encourage renewable energy adoption and reduce long-term energy costs.
According to the association, implementing these reforms would lower manufacturing costs, attract fresh investments, safeguard employment, and strengthen textile exports from the state.