Industries seek rollback of rooftop solar network charge in Tamil Nadu

Coimbatore: Industrial bodies have urged the Tamil Nadu government to scrap the “network charge” levied on rooftop solar power projects, calling it a deterrent to renewable energy adoption and akin to penalising industries for generating green power for captive use.

They said rooftop solar projects, under which panels are installed on building terraces to generate electricity, have become an effective solution for industries seeking to reduce dependence on the grid and manage rising power costs. Instead of incentivising such projects, the state was continuing to collect network charges, they alleged.

Recycle Textile Federation (RTF) president Jayapal said Tamil Nadu was not a power-surplus state and continued to rely heavily on electricity sourced from the central pool and private renewable energy producers, including wind and solar firms. He pointed out that industries had increasingly turned to renewable energy projects to meet their power requirements as electricity tariffs had gone up over the years.

Jayabal said the levy of network charges on rooftop solar projects was unique and amounted to a penalty on industries producing power within their own premises for self-consumption. He said such projects helped improve industrial output and, in turn, boosted tax revenues for the state.

He said an industrial association had earlier challenged the levy in court and secured an order against the collection of network charges. However, the exemption was granted only to the association that had moved court, while others continued to pay the charge.
According to industrial representatives, the levy has dampened investments in rooftop solar projects in Tamil Nadu.

Though repeated representations were made to previous governments and protests were held, only a 50% reduction in the charge was achieved, they said, adding that the demand now was for its complete withdrawal.
Jayapal said industrial bodies had also submitted their demand to electricity minister Nirmala Kumar after the new government took office in the state under chief minister Vijay.

He claimed that doing away with the network charge would cost the state around Rs 188 crore a year, but could significantly boost rooftop solar adoption among MSMEs and strengthen industrial output. That, he said, would translate into higher state GST collections, potentially crossing Rs 1 lakh crore annually.

Industrial bodies have urged the state government to act swiftly and abolish the network charge in full.