Punjab: No increase in power rates before the 2027 elections

Punjab: Despite power subsidies, theft, and pending bills worth crores of rupees from government departments, consumers can breathe a sigh of relief as no major increase in electricity prices is expected before the 2027 assembly elections. According to the Punjab State Power Corporation Limited (PSPCL), the total power subsidy will reach ₹22,250 crore in 2026-27. PSPCL has filed its petition with the Punjab State Electricity Regulatory Commission (PSERC) for the Annual Revenue Requirement (ARR) for the next financial year. A senior official involved in the process said that they had sought an increase of approximately 4 percent, but this is unlikely to be approved “given the adjustments and reduction in some of the power regulator’s expenses.”

According to the submission, the deficit during 2026-27 will be a marginal loss of ₹1,713 crore, including losses from previous years. A senior PSPCL engineer claimed, “Because the PSERC has deducted some expenses from the ARR, there may be no or very little tariff increase in the next financial year. There is no possibility of a power tariff increase, especially with the assembly elections approaching.” In the ARR, the PSPCL expects a revenue requirement of ₹52,385 crore, with current tariff income of ₹53,850 crore. Last year, the regulatory commission approved a revenue requirement of ₹44,395 crore. Now, the PSPCL has submitted a true-up (actual) amount of ₹47,707 crore, primarily due to an increase in fuel costs from ₹3,155 crore to ₹3,489 crore due to increased power supply from government-owned thermal plants. The main component of the recent ARR is “estimated power purchase of Rs 34,081 crore,” while last year’s approved power purchase cost was Rs 29,605 crore, which has now increased to Rs 29,607 crore.
Interestingly, the estimated increase in power purchase is more than Rs 4,400 crore. Employee costs are estimated at Rs 7,881 crore, an increase of Rs 800 crore from last year’s true-up of Rs 7,071 crore. Of the Rs 22,250 crore subsidy, Rs 11,249 crore is for the agriculture sector, Rs 8,253 crore for the domestic sector, and Rs 2,747 crore for providing 300 units of free electricity per month to domestic consumers. Another senior PSPCL official said, “Dues to government departments, power theft, and late payment of subsidies are serious issues that could worsen PSPCL’s financial health. Therefore, the government should ensure that both these issues are dealt with strictly for the better financial health of PSPCL.” Speaking to The Tribune, Power Minister Sanjeev Arora said that they are “working to improve PSPCL’s efficiency.” The minister said, “Instead of increasing power, we will try to reduce electricity charges further.” Arora added, “The AAP government is committed to power consumers and we are against increasing power for any category of consumers.”