The Tamil Nadu government, under the newly-sworn in chief minister C Joesph Vijay, the actor-turned politician, has formally rolled out its much-anticipated free electricity scheme, announcing 200 units of free power every two months for eligible domestic consumers whose bimonthly electricity consumption is up to 500 units. Fulfilling one of his poll promises, Vijay signed the order immediately after taking oath on Sunday.
Following it up, the Energy Department through G.O dated May 10, 2026, informed that the move aims to ease the financial burden on households amid rising living costs and inflationary pressures.
The government stated that the scheme would benefit ordinary consumers by reducing electricity expenses and offering relief against inflation-driven hardships.
Subsidy burden estimated at Rs 1,730 crore annually
According to the order, the state government will bear an additional tariff subsidy of Rs 1,730 crore per annum for implementing the enhanced free electricity benefit. The scheme comes into force with immediate effect from May 10, 2026.
The government clarified that consumers with bimonthly power consumption exceeding 500 units would continue under the existing tariff structure. However, such consumers would still be eligible for the already available 100 units of free electricity every two months.
Financial arrangements outlined
The order detailed the financial mechanism for implementing the subsidy, including the creation of a new expenditure head under the Chief Electrical Inspectorate.
The sanctioned expenditure will initially be met through an advance from the Contingency Fund, pending legislative approval through the Revised Budget Estimates for 2026-27.
The Chief Electrical Inspector has been designated as the estimating, reconciling and controlling authority for the newly created account heads.
Legislative approval to follow
The government said the expenditure would be treated as a “New Service”, requiring subsequent approval from the state legislature.
The Finance Department has already concurred with the proposal through its official communication dated May 10, 2026. The order was issued by Mangat Ram Sharma, Additional Chief Secretary to Government (FAC), Energy Department.
Welfare push ahead of rising household expenses
The move is being seen as a significant welfare measure by the Tamil Nadu government, particularly at a time when household budgets are under pressure from inflation and higher utility costs.
Industry observers note that the enhanced free electricity support could provide meaningful relief to lower and middle-income households, while also increasing the state’s subsidy commitments in the power sector.