The Supreme Court has approved a 20-year settlement of a decades-old power-sharing dispute involving Punjab, Haryana and Himachal Pradesh. Under the arrangement, Punjab and Haryana will provide Himachal Pradesh 11.97 bn units (MU) of electricity towards dues linked to the Bhakra Nangal and Beas hydroelectric projects.

A three-judge bench comprising Chief Justice of India Surya Kant and Justices Joymalya Bagchi and V Mohana accepted a proposal from the Centre to settle the outstanding amount through electricity rather than cash. The court directed that the arrangement be implemented in accordance with its 2011 judgment on Himachal Pradesh’s entitlement.

The judgment recognised Himachal Pradesh’s right to a 7.19 per cent share of power generated by the projects. The settlement also includes an adjustment of Rs. 4.2 bn for historical capital costs incurred in constructing the dams, while Himachal Pradesh will not be required to make any payment to Punjab or Haryana.

The states had differed over the period for clearing the dues. Punjab initially opposed the Centre’s proposed 15-year settlement period and later sought 30 years, while Himachal Pradesh had requested that the matter be settled within 10 years. The Central Electricity Authority had originally calculated Himachal Pradesh’s entitlement at 13,066 MU.

Under the 2011 allocation, Punjab and Haryana were assigned 51.80 per cent and 37.51 per cent, respectively, while Himachal Pradesh received 7.19 per cent. Rajasthan’s allocation was largely unaffected and Chandigarh was assigned 3.50 per cent. The court had recognised Himachal Pradesh’s entitlement in the Bhakra project from November 1, 1966, the Dehar project from November 1977 and the Pong Dam project from January 1978.