Earlier, government had invested in treasury bonds during good rainfall years in accordance with a directive from the Chief Minister during her earlier regime who had instructed that the money be used during distress period.
"Generation in TNEB's hydel Power stations go down by a large extent during times when monsoon fails. To compensate the damage, the Chief Minister had directed in her previous regime that government deposit Rs 125 crore a year in treasury bonds which could be withdrawn later to be given to TNEB to procure additional electricity," an official release in Chennai said.
The total invested sum in treasury bonds was Rs 375 crore and with "monsoon failing this year" Jayalalithaa had directed compensation of the said amount to TNEB as subsidy, it added.
Further, she announced a sum of Rs 352 crore as short-term loan towards setting up co-generation power units in 10 cooperative and two public sector sugar mills in the state.
The power units to add 183 MW were being set up with the help of TNEB with funding and loans from Power Finance Corporation, Indian Renewable Energy Development Agency and Sugar Development Fund, it said.
There was a delay in obtaining loan from Sugar Development Fund and to ensure speedy work, the Chief Minister directed the government short-term loan, it added.