TANGEDCO officials indicated that the prices quoted by AESL were higher than expected. Negotiations to reduce the pricing were unsuccessful, leading to the decision to cancel the tender process. An official, speaking on condition of anonymity, noted that the price offered to TANGEDCO exceeded ₹120 per meter per month, which was higher than rates provided to other states like Andhra Pradesh.
In addition to the package involving AESL, TANGEDCO has also canceled the remaining three tender packages, all floated in August 2023 under the Centre's ₹19,000 crore Revamped Distribution Sector Scheme (RDSS). The corporation cited "administrative reasons" for these cancellations and plans to reissue the tenders soon.
This development follows political scrutiny over alleged connections between the Tamil Nadu government and the Adani Group. Opposition parties had accused Chief Minister MK Stalin of holding undisclosed meetings with Gautam Adani, allegations that were firmly denied by Stalin and his party, the Dravida Munnetra Kazhagam (DMK). In a statement to the state assembly on December 10, Stalin asserted, "Adani did not come to meet me. I have not met Adani either."
The Adani Group has recently faced legal challenges, including an indictment by a U.S. court over alleged bribery charges. The U.S. Department of Justice alleges that between 2020 and 2024, Adani executives collaborated with those from another company to pay bribes to Indian government officials in five states to secure solar energy supply contracts projected to generate substantial profits over two decades. The Adani Group has denied these allegations as "baseless" and expressed intent to pursue all possible legal recourse.
The cancellation of the smart meter tenders has been met with approval from certain political factions. PMK president Anbumani Ramadoss claimed that the annulment was a victory for his party, which had advocated for the cancellation due to concerns over financial losses stemming from declining smart meter prices since the tenders were initially invited. Ramadoss urged TANGEDCO to implement the smart meter project independently, cautioning against diverting public funds to private companies.
The CITU-backed union, Central Organisation of Tamil Nadu Electricity Employees (COTEE), welcomed TANGEDCO's decision. COTEE state secretary S Kannan stated that the union had previously opposed the outsourcing of the smart meter project, advocating for its execution by TANGEDCO itself. Kannan emphasized that the cancellation aligns with the union's stance against privatization and the diversion of public funds to private entities.
The smart meter initiative is part of a broader effort to modernize Tamil Nadu's electricity distribution infrastructure. Smart meters are designed to provide real-time data on electricity consumption, enhance billing accuracy, and improve energy efficiency. The project's implementation under the RDSS aims to reduce distribution losses and enhance the overall reliability of the power supply in the state.