Ahead of poll, Punjab lowers power tariff by 50 paise-Rs 1.55 per unit

In the run-up to the Assembly elections, the Punjab Government has reduced the power tariff for all categories of consumers by 50 paise to Rs 1.55 per unit for the 2026-27 financial year, with the revised rates coming into effect from April 1.

Just as the previous Congress and SAD-BJP governments did, the ruling AAP has also lowered the tariff in its last year in office. The Congress government had reduced the tariffs by 0.89 per cent in 2021-22 and the SAD-BJP coalition by 0.65 per cent in 2016-17.

The new tariff order, announced by the Punjab State Electricity Regulatory Commission (PSERC) on Friday, shows that the average cost of power supply will come down from Rs 7.15 per kWh to Rs 6.15 per kWh.

The tariff order has been announced two days before the presentation of the Punjab Budget for 2026-27 on March 8, probably to take into account the reduction in power subsidy burden on the state exchequer. The cut in tariffs for domestic and agriculture pumpset (AP) consumers, who account for the largest share of power subsidy, will lower the state’s total subsidy burden by around Rs 4,500 crore — from Rs 19,657.36 crore to Rs 15,200.55 crore.

Similarly, the reduction in tariff for industrial consumers will bring down the industrial subsidy bill from Rs 2,385 crore to Rs 927 crore.

Domestic consumers will get relief in the range of 55 paise to Rs 1.55 per unit, depending on categorisation and consumption. AP consumers will witness tariff reduction by Rs 1.32 per unit.

For commercial and non-residential consumers, the rates will decline by 50 paise to 79 paise a unit. For industrial consumers, the relief is in the range of 12 paise to 74 paise per unit. The tariff for electric vehicle charging has been cut from Rs 6.20 per kVAh to Rs 5 per kVAh — the lowest in the country. Industrial and commercial consumers will bear the burden of the subsidy given to domestic and AP consumers.

Power Minister Sanjeev Arora said the tariff reduction would provide relief to all sections of society and boost industrial competitiveness. “It also signals the financial turnaround of Punjab State Power Corporation Limited,” he said.

“Cross-subsidies have been kept within the 20 per cent limits, in line with the provisions of the National Tariff Policy,” said PSERC Chairman Vishwajit Khanna.

Punjab State Power Corporation Limited has shown a profit of Rs 7,851.91 crore from the true-up of 2024-25 and projections for 2026-27, with the revenue from the existing tariff totalling to Rs 52,791.41 crore. The power utility net revenue requirement is Rs 44,939.50 crore, which has been considered by the PSERC to reduce the tariff.