Quick Answer: TANGEDCO domestic tariff (LT-IA, per TNERC Tariff Order No. 6 of 2024, effective 1 July 2024) is telescopic — each slab rate applies only to units inside that slab, then the next slab kicks in. Two-tier free-supply subsidy: households using ≤500 units bi-monthly get 200 free units, those above 500 units get only 100 free units. Rates climb from ₹4.70/unit (101–400 slab) to ₹11.55/unit (above 1,000 units bi-monthly). A 550-unit bi-monthly household pays roughly ₹2,460 in energy charges alone. Scroll down for the full telescopic table, the exact tier-1 vs tier-2 split, and how a small solar system pulls you back under the 500-unit threshold to restore the larger subsidy.

Understanding your TANGEDCO electricity tariff is essential before evaluating whether solar makes financial sense for your home or business. Tamil Nadu's electricity pricing structure is complex — with progressive slabs for domestic consumers, separate tariff categories for commercial and industrial users, and additional charges that appear on your bill beyond the base energy rate. This guide breaks down every tariff category applicable in 2026, shows you exactly how your bill is calculated, and compares the cost of grid electricity against solar generation.

Domestic Tariff Slabs (LT-IA) — Two-Tier Subsidy Structure

TANGEDCO's domestic tariff under LT-IA (Low Tension – Domestic) is telescopic — each slab rate applies only to the units that fall inside that slab; the next slab rate kicks in only for units above the threshold. Per TNERC Tariff Order No. 6 of 2024 (effective 1 July 2024), Tamil Nadu uses a two-tier free-supply subsidy that splits households by total bi-monthly consumption.

Tier 1 — Consumption ≤ 500 units bi-monthly (200 free units)

Consumption Slab (units/bi-month)	Energy Charge per Unit
1–200 units	₹0 (free)
201–400 units	₹4.70
401–500 units	₹6.30

Tier 2 — Consumption > 500 units bi-monthly (only 100 free units)

Consumption Slab (units/bi-month)	Energy Charge per Unit
1–100 units	₹0 (free)
101–400 units	₹4.70
401–500 units	₹6.30
501–600 units	₹8.40
601–800 units	₹9.45
801–1000 units	₹10.50
Above 1000 units	₹11.55

Fixed Charges (bi-monthly)

Connected Load	Fixed Charge per Bi-Month
Up to 500 W	₹30
501 W – 1 kW	₹45
Above 1 kW	₹45 + ₹30 per additional kW

Download / Print: Use Ctrl+P (or ⌘+P) to save this page as PDF — the table is print-optimised.

The 500-Unit Cliff: Why Tier 2 Hurts

The biggest single jump in TANGEDCO's domestic structure is not between slabs — it is between the two tiers. Cross 500 units bi-monthly and the subsidised free quota drops from 200 units to just 100 units. You also unlock the steep upper slabs (₹8.40 → ₹11.55 per unit). Compare two households:

500 units bi-monthly (Tier 1): 200 free + 200 × ₹4.70 + 100 × ₹6.30 = ₹1,570 energy charge
600 units bi-monthly (Tier 2): 100 free + 300 × ₹4.70 + 100 × ₹6.30 + 100 × ₹8.40 = ₹2,880 energy charge

100 extra units added ₹1,310 to the bill — an effective rate of ₹13.10 per unit for the extra consumption (because both the lost subsidy and the new top slab hit at once). This is precisely where a small solar system delivers outsized returns: even a 1 kW system generating 120–140 units bi-monthly can push you back under the 500-unit threshold, restoring the 200-unit subsidy and shaving off the ₹8.40 slab entirely.

Use our solar savings calculator to see exactly how much a solar system would save based on your current consumption slab.

Commercial Tariff Rates (LT3)

Commercial consumers — shops, offices, restaurants, hotels, hospitals — pay significantly higher tariffs than domestic consumers. TANGEDCO's commercial tariff does not have the progressive slab structure; instead, it is a flat rate with demand-based charges.

Tariff Component	Rate
Energy Charge	₹8.00–₹10.50 per unit
Fixed/Demand Charge	₹80–₹120 per kW of sanctioned demand per month
Fuel Cost Adjustment (FCA)	₹0.15–₹0.40 per unit (varies quarterly)
Power Factor Surcharge	Up to 2% penalty if PF < 0.9

Billing cycle: Commercial consumers are billed monthly (unlike domestic bi-monthly).

For a commercial establishment consuming 2,000 units per month with a 10 kW sanctioned demand, the monthly bill works out to approximately:

Energy charges: 2,000 x ₹9.00 = ₹18,000
Demand charges: 10 x ₹100 = ₹1,000
FCA: 2,000 x ₹0.25 = ₹500
Total: approximately ₹19,500 per month

At ₹9+ per unit effective rate, commercial solar with a generation cost of ₹2.50–₹3.50 per unit offers a 60–70% savings on electricity costs. This is why commercial rooftop solar has the fastest payback period of any consumer category.

Industrial Tariff Rates

Industrial consumers are categorised under multiple tariff codes depending on voltage level and connected load.

LT Industrial (LT4/LT5) — Low Tension Supply

Tariff Component	Rate
Energy Charge	₹5.75–₹6.50 per unit
Demand Charge	₹200–₹300 per kVA per month
FCA	₹0.15–₹0.40 per unit
Power Factor Penalty	1% surcharge per 0.01 drop below 0.9

HT Industrial (HT1/HT2) — High Tension Supply (11 kV / 33 kV)

Tariff Component	Rate
Energy Charge	₹5.50–₹6.75 per unit
Demand Charge	₹350–₹500 per kVA per month
FCA	As notified
Minimum Demand	90% of sanctioned demand
TOD Tariff (peak surcharge)	+25% during peak hours (6 AM–10 AM and 6 PM–10 PM)
TOD Tariff (off-peak rebate)	-5% during off-peak (10 PM–6 AM)

EHT Industrial (HT3) — Extra High Tension (66 kV / 110 kV)

Tariff Component	Rate
Energy Charge	₹5.00–₹6.00 per unit
Demand Charge	₹400–₹550 per kVA per month
Contract Demand	Minimum 1 MVA
RPO Compliance	Mandatory renewable purchase obligation

Industrial solar insight: For HT/EHT consumers paying ₹6+ per unit plus demand charges, rooftop and open-access solar installations offer payback periods of 3–4 years. The time-of-day (TOD) peak surcharge makes solar especially valuable since solar generation peaks during daytime hours, reducing peak-rate consumption. Contact us for industrial solar feasibility analysis.

Agricultural Tariff

Tamil Nadu provides free electricity to agricultural pump set consumers under a long-standing state subsidy:

Category	Tariff
Agricultural pump sets (LT6)	Free (government subsidised)
Agricultural services (HT4)	Subsidised — ₹1.50–₹2.00 per unit

While agricultural consumers receive free electricity, the supply is often restricted to specific hours (typically 7–9 hours per day), and power quality on agricultural feeders can be poor. Some progressive farmers are installing solar pump systems to gain independence from restricted supply schedules, especially for precision irrigation that requires on-demand power.

How to Calculate Your TANGEDCO EB Bill: Step by Step

Let us walk through a complete domestic bill calculation with a real example.

Scenario: A household in Coimbatore consumes 550 units in a bi-monthly billing period with a 2 kW connected load.

Step 1: Identify the Tier

550 units > 500 → falls under Tier 2: only 100 units free, full telescopic ladder applies.

Step 2: Calculate Energy Charges Slab-by-Slab (Telescopic)

Slab	Units in slab	Rate	Sub-total
1–100	100	₹0	₹0
101–400	300	₹4.70	₹1,410
401–500	100	₹6.30	₹630
501–550	50	₹8.40	₹420
Total energy charge	550	—	₹2,460

Step 3: Add Fixed Charges

Connected load 2 kW → ₹45 + ₹30 (extra kW) = ₹75 per bi-month.

Step 4: Add Fuel Cost Adjustment (FCA)

FCA is a variable charge that TNERC revises quarterly based on TANGEDCO's fuel procurement costs. Indicative FCA: ₹0.20 per unit. FCA = 550 × ₹0.20 = ₹110

Step 5: Add Tax

Electricity duty of 5% applies to energy charges in Tamil Nadu. Tax = ₹2,460 × 0.05 = ₹123

Step 6: Total Bill

Component	Amount
Energy charges (telescopic, 550 units)	₹2,460
Fixed charges (2 kW load)	₹75
Fuel cost adjustment	₹110
Electricity duty (5%)	₹123
Total bi-monthly bill	₹2,768
Effective rate per unit	₹5.03

What If Solar Pulled Consumption Down to 300 Units?

With a 2–3 kW solar system generating approximately 250 units bi-monthly, net grid consumption drops to 300 units. That clears the 500-unit threshold and moves the household back into Tier 1 — restoring the 200-unit free quota:

Slab	Units	Rate	Sub-total
1–200	200	₹0	₹0
201–300	100	₹4.70	₹470
Total energy	300	—	₹470

Component	Amount
Energy charges (300 units, Tier 1)	₹470
Fixed charges (2 kW)	₹75
FCA (300 × ₹0.20)	₹60
Electricity duty (5%)	₹24
Total bi-monthly bill	₹629

Savings per bi-month: ₹2,139 (₹2,768 minus ₹629). That is ₹12,834 saved per year — and this does not include further savings from net metering export credits. Two compounding wins: Tier 1 subsidy restored + the ₹8.40 slab eliminated. Check your specific savings with our solar calculator.

Domestic consumers can reduce upfront cost further through the PM Surya Ghar subsidy of up to ₹78,000 for systems up to 3 kW, or by financing through a solar loan at 8–9% interest — making the monthly EMI lower than the EB bill savings from day one.

Fuel Cost Adjustment Charges (FCA)

FCA is one of the least understood components of your electricity bill. TNERC permits TANGEDCO to pass through variations in fuel costs (coal, gas, purchased power costs) to consumers through a quarterly-revised surcharge.

FCA is calculated per unit consumed and appears as a separate line item on your bill
The rate varies between ₹0.10 and ₹0.50 per unit depending on TANGEDCO's fuel cost position
FCA applies to all consumer categories
TNERC publishes FCA orders quarterly on tnerc.gov.in

FCA effectively increases your tariff by ₹0.10–₹0.50 beyond the base rate. Solar-generated units are not subject to FCA, which is an additional hidden saving from solar.

Monthly vs Bi-Monthly Billing

TANGEDCO bills different consumer categories on different cycles:

Consumer Category	Billing Cycle
Domestic (LT2A, LT2B)	Bi-monthly (every 2 months)
Commercial (LT3)	Monthly
Industrial (LT4, LT5)	Monthly
HT consumers	Monthly
Agricultural (LT6)	No charge — free supply

For domestic consumers, the bi-monthly cycle means your slab is evaluated based on two months of cumulative consumption. A household using 250 units per month will be billed for 500 units bi-monthly, placing them in the 401–500 slab at ₹3.00 per unit. Monthly billing would have kept each month's 250 units in the 201–400 slab at ₹2.00 per unit. This is a structural disadvantage of bi-monthly billing that solar directly addresses by reducing cumulative consumption.

EB Bill Cost vs Solar Cost per Unit: The Comparison

The fundamental question: is solar cheaper than grid electricity?

Parameter	TANGEDCO Grid	Rooftop Solar
Cost per unit (domestic, Tier 2, 500+ units)	₹8.40–₹11.55 (top slabs)	₹2.00–₹3.00 (levelised over 25 years)
Cost per unit (commercial)	₹6.35–₹7.50	₹2.50–₹3.50
Cost per unit (industrial HT)	₹5.50–₹6.75	₹2.50–₹3.50
Annual escalation	3–5% (tariff revisions)	0% (sunlight is free)
Fuel cost adjustment	₹0.10–₹0.50 additional	None
25-year cost trend	Rising	Fixed at installation cost

Over a 25-year system life, the gap widens dramatically. A household paying ₹5.50 per unit today will likely pay ₹9–12 per unit by 2040 at historical tariff escalation rates, while their solar cost per unit remains fixed at the day-of-installation rate. Note: the ₹2.00–₹3.00 solar cost above factors in the 5% concessional GST on panels and installation and assumes the PM Surya Ghar subsidy for eligible domestic systems.

How Tariff Hikes Affect Your Long-Term Solar Savings

TNERC has revised TANGEDCO tariffs multiple times over the past decade, and the trend is consistently upward. Each tariff revision increases the value of solar electricity you generate:

2014 tariff revision: First major increase after a long freeze
2017 revision: 10–15% increase across categories
2022 tariff order: Significant restructuring of domestic slabs
2024–2025 FCA increases: Passed through rising coal costs to consumers
2026 expected: Further revisions under discussion at TNERC

Every future tariff increase makes your existing solar system more valuable because your generation cost was locked in at installation. A system installed in 2026 at ₹2.50 per unit levelised cost will save progressively more every year as grid tariffs rise.

A household consuming 550 units bi-monthly — a common level for Tamil Nadu homes running one AC — saves roughly ₹12,800 per year by dropping back under the 500-unit Tier 1 threshold with a 2–3 kW solar system. That number only grows as TANGEDCO tariffs rise. Check your savings in 30 seconds with the Tristar solar calculator, or WhatsApp us directly — we reply within the hour. We serve homeowners and businesses across Tamil Nadu with solar solutions sized specifically to your consumption slab.

TANGEDCO EB Tariff 2026: ₹0 to ₹7.60/unit — Full Slab Table