Punjab Engineers Urge PSPCL To Reconsider Revised ARR

16 Feb 2026 CW Team

PSPCL had filed its Multi-Year Tariff (MYT) petition for the control period FY 2026-27 to FY 2028-29 in accordance with the Punjab State Electricity Regulatory Commission (PSERC) regulations, including true-up for FY 2024-25 and projections for the three-year period. Based on field conditions PSPCL originally proposed a distribution loss trajectory of 12.75 per cent for FY 2026-27, 12.50 per cent for FY 2027-28 and 12.20 per cent for FY 2028-29, which the engineers characterised as realistic given existing operational assessments.

The revised ARR sharply reduces projected distribution losses and fixes the target at ten per cent for FY 2026-27, implying an abrupt reduction of two point seven five per cent within a single year. The engineers said this change appears aimed at projecting a reduction in power purchase cost exceeding Rs 52 billion (bn) over the three-year period, thereby portraying a lower tariff requirement in the current MYT period, but they argued the target is neither realistic nor technically feasible without major systemic interventions.

The association further criticised the treatment of loss funding of Rs 35.82 billion (bn) as non-tariff income, saying this effectively negates the purpose of loss funding and distorts the financial position. It said the projected reduction would require substantial capital investment in distribution infrastructure, for which no adequate provisions have been made, and that deferring the burden would lead to higher and uncertain tariffs in future years. The engineers asked PSPCL management to revisit the revised filing to avoid serious and lasting harm.

The PSEB Engineers Association has urged the Punjab State Power Corporation Limited (PSPCL) to reconsider its decision to file a revised Aggregate Revenue Requirement (ARR), warning that the move risks pushing the Punjab power sector into long-term financial uncertainty. The appeal was made in a letter to the Chairman-cum-Managing Director following a revised filing dated four February 2026. The association said the exercise requires reconsideration to prevent damage to consumers and the utility. PSPCL had filed its Multi-Year Tariff (MYT) petition for the control period FY 2026-27 to FY 2028-29 in accordance with the Punjab State Electricity Regulatory Commission (PSERC) regulations, including true-up for FY 2024-25 and projections for the three-year period. Based on field conditions PSPCL originally proposed a distribution loss trajectory of 12.75 per cent for FY 2026-27, 12.50 per cent for FY 2027-28 and 12.20 per cent for FY 2028-29, which the engineers characterised as realistic given existing operational assessments. The revised ARR sharply reduces projected distribution losses and fixes the target at ten per cent for FY 2026-27, implying an abrupt reduction of two point seven five per cent within a single year. The engineers said this change appears aimed at projecting a reduction in power purchase cost exceeding Rs 52 billion (bn) over the three-year period, thereby portraying a lower tariff requirement in the current MYT period, but they argued the target is neither realistic nor technically feasible without major systemic interventions. The association further criticised the treatment of loss funding of Rs 35.82 billion (bn) as non-tariff income, saying this effectively negates the purpose of loss funding and distorts the financial position. It said the projected reduction would require substantial capital investment in distribution infrastructure, for which no adequate provisions have been made, and that deferring the burden would lead to higher and uncertain tariffs in future years. The engineers asked PSPCL management to revisit the revised filing to avoid serious and lasting harm.

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