Homes in Chennai that use 500 units or less in a two-month billing cycle now get the first 200 units free. Cross 500 units, even by one, and the free allowance drops back to the long-standing 100 units, with the rest charged at higher slab rates. That single threshold is the most important thing to understand about your electricity bill in 2026.
The change came through an order signed on 10 May 2026, the day Chief Minister C. Joseph Vijay took office, and the Tamil Nadu Electricity Regulatory Commission (TNERC) cleared the matching subsidy for the distribution company later that month. Here is how the scheme works and how the bimonthly cycle shapes what you pay.
What changed in May 2026
According to The Tribune’s report of 10 May, the first file the new Chief Minister signed gave 200 free units to domestic consumers. The eligibility line of 500 units in a two-month cycle is set out in the explainer published by the Citizen consumer and civic Action Group (CAG), a Chennai consumer research body.
On 28 May, Mercom India reported that TNERC had approved a provisional additional tariff subsidy of about ₹1,545 crore for 2026-27. The money compensates the Tamil Nadu Power Distribution Corporation (TNPDCL) for the revenue it loses over the 326 days from 10 May to 31 March.
Households above 500 units keep the older benefit of 100 free units every two months. TNPDCL had updated its billing software by 22 May to identify eligible consumers, The South First reported.
Households were also spared the most recent general revision. When TNERC raised tariffs by about 3.16 per cent in July 2025, domestic consumers were exempted, Mercom India reported.
How the slabs work
Tamil Nadu uses telescopic slabs for homes: each rate applies only to the units inside that band, and the bands are counted over two months. When the current structure took effect in September 2022, DT Next set out the bands as follows:
- 1 to 100 units (free for every domestic consumer)
- 101 to 200 and 201 to 400 units
- 401 to 500 units
- 501 to 600, 601 to 800 and 801 to 1,000 units
- above 1,000 units
The per-unit rate rises with each band. Rates have been revised since 2022, and the State pays part of the charge for many homes, so the figure you pay can differ from the commission’s tariff. We have not printed a rate table because we could not read the current tariff order on TNERC’s site this week. Your TNPDCL bill shows the units billed in each slab, which is the most reliable guide.
A fixed charge is also added on top of the energy charge.
Why the 500-unit line is so expensive to cross
CAG’s examples show the jump clearly. A home using 500 units in a cycle pays about ₹1,570 in energy charges. At 510 units, the bill rises to roughly ₹2,124, about ₹554 more for just 10 extra units, because the free allowance halves and the higher slabs kick in. At 220 units, the new scheme brings the bill down to about ₹94, from around ₹329 earlier, because only 20 units are now billed.
How bimonthly billing affects your bill
TNPDCL reads meters once every two months, so the slab limits apply to two months of use, not one. A flat in Velachery or Ambattur running an air conditioner through a hot April and May can easily cross 500 units in a single cycle, then fall well below it once the northeast monsoon cools things down. The South First noted that many consumers complained of higher bills during the summer.
Practical steps:
- Note your meter reading date and the reading on your last bill, and read the meter yourself a few weeks into the cycle.
- If you are close to 500, shift heavy loads such as geysers or a second AC where you can.
- Check that your connection is billed under the domestic category; a wrong category means wrong slabs.
- If a reading looks wrong, raise it with your TNPDCL section office before the due date.
Who is covered, and who is not
The benefit is for domestic connections. A shop or office run from the front room of a house in Mylapore or Purasawalkam is billed under a commercial tariff and does not get the free units. Tenants benefit through the landlord’s connection, so if your flat shares a single meter with another portion, combined use can push the household past 500 units. Per the CAG explainer, about 2.23 crore of Tamil Nadu’s 2.46 crore domestic consumers use under 500 units in a cycle, so most homes fall inside the scheme. Common areas in apartment complexes, such as lifts and pumps, usually run on a separate connection under a different tariff.
Quick answers
Who gets 200 free units?
Domestic consumers whose two-month consumption is 500 units or less.
What if I use 501 units?
You get only 100 free units, and every unit above 500 is charged in the higher slabs.
Do I need to apply?
Reports say TNPDCL applies the benefit automatically through billing.
Where is the official tariff?
In TNERC’s tariff orders on tnerc.tn.gov.in, with billing details from TNPDCL.
Information checked against official sources on 18 October 2026. Fees, dates and rules can change; confirm on the linked official pages before acting.
Sources
- TNERC clears subsidy for Tamil Nadu’s free power programme (Mercom India, 28 May 2026)
- Tamil Nadu CM Vijay signs first order giving 200 units of free electricity (The Tribune)
- 200 units free electricity scheme in Tamil Nadu: what you need to know (Citizen consumer and civic Action Group)
- Tamil Nadu hikes FY 2026 electricity tariffs by 3.16% (Mercom India, 4 Jul 2025)
- Power tariff hike comes into effect (DT Next, Sep 2022)
- 100 days of TVK government (The South First)
- Tamil Nadu Electricity Regulatory Commission
- Tamil Nadu Power Distribution Corporation (TNPDCL)
