Assembly report flags inefficiencies in HPPCL, adding to Himachal’s fiscal woes
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Shimla, Aug 25,
In a report tabled in the Monsoon session, the Himachal Pradesh Vidhan Sabha Committee has pulled up the state-run Himachal Pradesh Power Corporation Limited (HPPCL) for financial losses, delays, and regulatory lapses in its hydropower projects. In its 22nd Action Taken Report (2025–26), the Committee on Public Undertakings observed that shortcomings in HPPCL’s functioning are contributing to the state’s worsening fiscal strain.
The Vidhan Sabha committee was chaired by Kishori Lal, with members Hiteshwar Parmar, Vikramaditya Singh Thakur, Sukh Ram Chaudhary, Inder Dutt Lakhanpal, Suresh Chaudhary, Bhuvneshwar Gaur, Pushparaj Thakur, Suresh Kumar, Naresh Nirathra and Vivek Sharma (Bikku), supported by the Vidhan Sabha Secretariat.
The report highlighted that HPPCL failed to sign mandatory Power Purchase Agreements (PPAs) before applying for Long-Term Access (LTA) with Power Grid Corporation of India. As a result, the approval was withdrawn and Rs 37.41 lakh deposited in fees and charges was forfeited, which the panel described as an avoidable loss. It further noted that despite depositing fees in September 2010, the matter reached the Himachal Cabinet only in December 2013, reflecting a delay of nearly 38 months. The committee questioned how such prolonged inaction could be defended as due diligence.
Also read: BJP demands strict probe and action on corruption in HPPCL engineer’s death case/
The panel also examined the effect of solar energy on hydropower demand, observing that HPPCL had not provided sufficient clarity on how renewable competition had impacted its revenues, even as the department argued that power exchange rates were largely dependent on national demand-supply conditions. In another finding, the report flagged wide fluctuations in transmission losses. Between 2017–18 and 2022–23, Kashang Hydro Project generated 870.87 million units but lost 15.24 MU before reaching buyers, Sainj Project generated 2091.87 MU with 57.95 MU lost, and Sawra-Kuddu generated 562.38 MU with 4.16 MU lost. Terming such variations a serious concern, the committee directed that a technical audit be conducted to determine whether the cause lay in operational inefficiencies or technical lapses.
The committee further noted that HPPCL repeatedly sold power below its levelized tariff. In 2021–22, for instance, Sainj Project sold power at Rs 4.21 per unit against a cost of Rs 7.23 per unit, while Sawra-Kuddu sold at Rs 4.79 per unit against a cost of Rs 9.41 per unit. Despite such recurring losses, HPPCL has not filed tariff petitions before the Himachal Pradesh Electricity Regulatory Commission (HPERC) since commissioning its projects, a lapse the committee warned could further erode the corporation’s financial sustainability.
Concluding, the Assembly committee stressed that inefficiencies within HPPCL are undermining state finances at a time of debt stress and delayed liabilities.
Notably, this is not the only controversy surrounding the corporation—HPPCL has also been in the spotlight following the death of its Chief Engineer, Vimal Negi. His family has publicly alleged workplace-related pressure as a contributing factor, and the matter is currently under investigation by the Central Bureau of Investigation (CBI).
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