Archive · 8 Nov 2025
Punjab Power Dispute Leads to Officer Suspensions Amid PPA Disagreements
People who manage electricity in Punjab are disagreeing about buying power.
The government and the engineers who run the power plants had different ideas about a big deal to buy electricity for 25 years.
The government thought the price was too high, comparing it to cheaper solar power and worrying about costing the state a lot of money.
But the engineers said this deal was for special power that works day and night, which is different from just solar power.
Because they couldn't agree, some important people in the power department were moved, suspended, or even fired.
The engineers are upset about these actions and are worried that not making new power deals could cause electricity shortages because the state needs more power each year.
A dispute over 25-year Power Purchase Agreements (PPAs) for 150 MW has led to personnel changes in Punjab's power department.
The government withheld approval for PPAs priced at Rs 5.13-5.14 per unit, citing higher costs than solar power at Rs 3 per unit and potential liabilities over Rs 12,000 crore.
Technocrats argue the PPAs were for essential hybrid power (solar, wind, batteries) ensuring 24/7 supply, and direct price comparison with solar power alone is misleading.
Disciplinary actions included the transfer of Administrative Secretary AK Sinha, suspension of Chief Engineer Harish Sharma, and termination of Director (Generation) Harjit Singh.
Engineers are protesting the actions, and concerns exist about future power shortages due to a failure to secure new power agreements amid growing demand.
- Who
- Punjab government officials and technocrats/engineers of the power department
- What
- A dispute over the approval of 150 MW Power Purchase Agreements (PPAs) led to disciplinary actions against senior power department officials.
- When
- Agreements were signed in September, and disciplinary actions followed.
- Where
- Punjab, India, concerning the Punjab State Power Corporation Limited (PSPCL).
- Why
- Disagreement over the cost and nature of the PPAs; the government viewed the price as too high compared to solar power and potentially burdensome, while technocrats argued the hybrid power was necessary for 24/7 supply and not comparable to solar alone.
Technocrats/Engineers
Punjab Government
Power Purchase Agreement (PPA) for 150 MW
Technocrats/Engineers
The PPAs were for essential hybrid power (solar, wind, batteries) ensuring 24/7 supply, and direct price comparison with solar power alone is misleading as solar is only available during the day and is weather-dependent. The agreements included penalties for non-performance and were approved by a committee of engineers and the PSPCL Board of Directors, facilitated by a central government agency.
Punjab Government
The government withheld approval for the PPAs priced at Rs 5.13-5.14 per unit, citing they were significantly higher than solar power at Rs 3 per unit and could burden PSPCL with liabilities exceeding Rs 12,000 crore over 25 years. The termination of one officer was partly attributed to high fuel costs at state-run plants.
Disciplinary Actions and Transfers
Technocrats/Engineers
Engineers are protesting the disciplinary actions, including the suspension of Chief Engineer Harish Sharma and termination of Director (Generation) Harjit Singh, viewing them as a consequence of disagreements over technical decisions and potentially political interference.
Punjab Government
The government took disciplinary actions, including transferring Administrative Secretary AK Sinha, suspending Chief Engineer Harish Sharma, and terminating Director (Generation) Harjit Singh, in response to the dispute over the PPAs and the decision to withhold approval.
Decision-Making Authority
Technocrats/Engineers
Technocrats argued that the PSPCL Board of Directors approved the deals and was authorized to file petitions with the regulatory commission, but the government intervened and prevented them from doing so.
Punjab Government
The government asserted its authority by withholding approval for the PPAs despite their prior approval by PSPCL's engineer committee and board of directors, indicating a preference for administrative oversight and financial prudence.
- Disputed PPA Capacity
- 150 MW for 25 years
- Disputed PPA Price
- Rs 5.13 to Rs 5.14 per unit
- Estimated Financial Liability
- Over Rs 12,000 crore
- Comparable Solar Power Price
- Rs 3 per unit
- Transferred Officer
- AK Sinha (Administrative Secretary)
- Suspended Officer
- Harish Sharma (Chief Engineer, Ropar thermal plant)
- Terminated Officer
- Harjit Singh (Director, Generation)
- Annual Power Demand Growth
- 800 MW
