Major Shakeup in Punjab Power Department Over Costly 150 MW Deal
A significant controversy has erupted within Punjab's power department, resulting in the transfer of Administrative Secretary AK Sinha, suspension of Chief Engineer Harish Sharma, and termination of Director Harjit Singh. The disciplinary actions stem from disagreements over a proposed 25-year power purchase agreement that would have burdened the Punjab State Power Corporation Limited (PSPCL) with liabilities exceeding Rs 12,000 crore.
The Costly Power Purchase Disagreement
At the heart of the dispute are two power purchase agreements for 150 MW of electricity - one for 100 MW and another for 50 MW - that were signed in September. Officials speaking anonymously revealed that the power was to be purchased at Rs 5.13 to Rs 5.14 per unit, while solar power is currently available at just Rs 3 per unit.
The agreements had already received approval from both the PSPCL engineers' committee and the board of directors. However, the Punjab government withheld final approval, citing the significantly higher cost compared to solar power alternatives.
Solar vs Hybrid Power: The Technical Debate
Power department technocrats have strongly defended the agreements, calling the comparison between solar and hybrid power like "comparing apples to oranges." According to senior technical experts, the proposed agreements were for hybrid power - combining solar energy during daytime, wind power at night, and battery storage for 24/7 supply.
The companies were contractually bound to provide 70% of power daily, regardless of weather conditions, with substantial penalty clauses for failure to meet minimum annual quotas. The penalty provisions included one-and-a-half times the electricity price for general failures and three times the annual price for missing annual quotas.
A senior technocrat explained: "Solar power is only available during daylight hours and is subject to weather conditions, while peak power demand occurs during evening hours when solar power is unavailable. The hybrid power solution would have ensured reliable 24/7 supply."
Approval Process and Government Intervention
The power purchase agreements were processed through the Solar Energy Corporation of India, a central government agency that had issued the tenders. The approval process involved multiple stages:
- Review by a committee of six chief engineers
- Assessment by two chief engineer-level accounts department officials
- Approval from the Long Term Power Purchase Committee
- Final endorsement by the PSPCL Board of Directors
Despite this comprehensive approval process, the Punjab government intervened before the agreements could be submitted to the Punjab State Electricity Regulatory Commission for final authorization.
Consequences and Growing Power Crisis
The suspensions and terminations have triggered protests among power department engineers, who organized rallies at the gates of Ropar and Lehra Mohabbat thermal plants. Meanwhile, Punjab faces a growing electricity crisis with power demand increasing by approximately 800 MW annually.
The state government has failed to establish new power generation sources, and with additional power agreements being blocked, Punjab may soon confront significant power shortages. Power Minister Sanjeev Arora was unavailable for comment on the developing situation.
The terminated officer, Harjit Singh, received official notice citing "high fuel cost" at state-run plants compared to private thermal units as justification for his dismissal.
