PSPCL’s investment plan scaled back; major hydro and metering plans rejected

In its final order in Petition No. 50 of 2025 dated 11 December 2025, the Punjab State Electricity Regulatory Commission (PSERC) approved Punjab State Power Corporation Limited’s Business Plan and Capital Investment Plan for FY 2026-27 to FY 2028-29. The approval sets the investment roadmap but with significant reductions from PSPCL’s proposals, especially for large generation and distribution schemes.

Hydro and thermal project approvals and cuts
For PSPCL’s generation business, the Commission approved a Capital Investment Plan of Rs 1,758.47 crore against the utility’s proposal of Rs 4,911.93 crore. A major reduction concerned the Shahpur Kandi hydro project, where Rs 424.26 crore sought by PSPCL was disallowed. The Commission directed that Shahpur Kandi related expenditure must be taken up through a separate petition after commissioning.
Investment proposals for renovation and modernisation at Mukerian Hydel Project Stage-I were also drastically pruned. Against PSPCL’s demand of Rs 600 crore, the Commission approved only Rs 15.55 crore, stating that a detailed and justified project report is needed before any large-scale approval.
For thermal generation assets, the Commission approved Rs 491.12 crore for Guru Gobind Singh Super Thermal Plant and Rs 629.15 crore for Guru Hargobind Thermal Plant. However, it recorded concern over PSPCL’s planning, pointing out that Rs 422 crore earlier proposed for flue gas desulphurisation units was later dropped, reflecting what the Commission described as a casual planning approach.

Distribution capital projects rationalised
For the distribution business, the Commission approved a Capital Investment Plan of Rs 7,325.45 crore against PSPCL’s request of Rs 11,042 crore. It rejected Rs 1,198.06 crore projected toward costs of new service connections, stating these should be recovered through consumer service connection charges rather than general capital investment.
It also disallowed Rs 812 crore sought for smart metering and distribution transformer metering, observing that these activities are already covered under the Revamped Distribution Sector Scheme. The Commission approved Rs 2,321.16 crore under the RDSS loss reduction programme but flagged slow progress in multiple civil and infrastructure projects, directing timely execution.

Overall approved programme
Across businesses, the Commission approved total capital investment of Rs 9,083.92 crore for the control period along with a capitalization plan of Rs 10,210.81 crore, to be largely financed through loans and subject to future true-up based on actual execution.

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