Ponni Sugars in India looks set to appeal against a tariff order passed by the Tamil Nadu Electricity Regulatory Commission.

The New Delhi company had planned to commission its cogeneration plant next month but the commission has pegged the power tariff at Rs 3.76 a unit for bagasse-based cogeneration plants commissioned on or after August 1, 2012. This is 18 per cent lower than the prevailing tariff of Rs 4.47/ unit and will have a negative impact on the project, says Ponni Sugars.

Ponni Sugars has set up the 19 MW cogeneration plant at a cost of around $20 million. A further 183 MW of cogeneration capacity is being set up in 12 co-operative sugar mills in the State. These are expected to be commissioned in May 2013 at a cost of more than $200 million and will also be affected by the tariff change.

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