E-Paper
No tariff hike’ projections: Power engineers slam PSPCL’s revised petition
The PSERC has directed PSPCL to issue a fresh public notice inviting objections and suggestions on the revised ARR and has sought additional data to justify the revised projections.
Power engineers body has raised concerns over Punjab State Power Corporation Limited’s Multi-Year Tariff (MYT) petition for the 2026-27 to 2028-29, alleging that key assumptions, particularly on distribution loss reduction, are technically unfeasible and financially misleading.
The revised petition seeks no power hike by revising the power losses. The PSERC has directed PSPCL to issue a fresh public notice inviting objections and suggestions on the revised ARR and has sought additional data to justify the revised projections.
PSPCL had originally filed its MYT petition on November 28, 2025, before the Punjab State Electricity Regulatory Commission (PSERC), proposing a gradual reduction in distribution losses from 12.75% in FY 2026-27 to 12.20% by FY 2028-29, citing prevailing field conditions and operational realities.
However, in a revised aggregate revenue requirement (ARR) filing submitted on February 4, 2026, PSPCL reduced the projected distribution losses to 10% for FY 2026-27, implying an abrupt reduction of 2.75 percentage points in a single year.
Power engineers’ association have termed this projection ‘unprecedented and unrealistic,’ and said that such a steep reduction has no historical precedent, nor is it supported by existing infrastructure or system-level interventions.
According to the association, the revised loss trajectory appears designed to project a reduction in power purchase costs exceeding ₹5,200 crore over the three-year MYT period, thereby showing a lower tariff requirement in the current control period.
They have cautioned that achieving such a reduction would require significant capital investment in strengthening the distribution network, including system upgrades, metering improvements, and loss-prone area interventions. “No specific or adequate provisions for such investments are reflected in the approved business plan,” engineers noted, questioning the credibility of the revised ARR assumptions.
“This appears to be an exercise to artificially suppress the projected revenue requirement under the MYT framework. Further, the treatment of loss funding ₹3581.95 crore as Non-Tariff Income (Regulation 27 of PSERC MYT regulations, 2022) in the revised ARR, effectively negates the very purpose of loss funding and presents a distorted financial position”, the body said.
Engineers have warned that artificially suppressing revenue requirements in the current MYT period could defer financial stress to future years, potentially leading to higher and more volatile tariffs, increased borrowings, and long-term financial instability for both PSPCL and the state power sector.
