$ 200 million boost to HP power sector reform

Under this World Bank-supported Program, no new investment in hydropower is envisaged but the program will help the state develop uniform environment and social policy and procedures.

$ 200 million boost to HP power sector reform

[Representational Photo : iStock]

Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu said that the Government of India is providing financing facility worth about Rs 1600 crore through the World Bank for the ‘Himachal Pradesh Power Sector Development Program’ to undertake holistic power sector reforms in a manner to allow for improvements in the renewable energy integration in the state.

“With the state equity, the total program cost is approximately more than Rs 2000 crore. Under this programme the World Bank funding is expected to be available by August, 2023 and for a duration of five years from 2023 to 2028,” he added.

The World Bank Board has approved the program on 27 June, 2023 at Washington, he said, adding that the agreement in this regard will now be taken up shortly in the month of July, 2023 and the first installment of this Fund to Himachal Pradesh is expected in August, 2023.


The Chief Minister said that the improvements in utilization of the state’s power sector resources in renewable energy, improvements in the reliability of the state’s grid at the transmission and distribution level, and strengthening of the institutional capacities of the various states’ power utilities and agencies would be undertaken under the programme.

Efforts will be made towards the promotion of integrated resource planning to allow for comprehensive planning of the power sector, piloting demand response management, improving the technical utilization of the existing hydropower assets to facilitate increased integration with other sources of renewable energy and establishing a single trading desk to allow for efficient trading of the State’s power.

These interventions will allow the state to maximize the revenue earned from the sale of energy through renewable balancing capacity. Sukhu said that the programme also aims to install new capacities in solar generation of about 200 MW, through HPPCL and HIMURJA.

“It is important for the state to meet its power requirements to allow for optimal trading and hence the Program shall also focus on strengthening the power network within the state at transmission by HPPTCL and in 13 towns at distribution levels (by HPSEBL),” he said.

Upgradation of the systems of the State Load Dispatch Center (HPSLDC) would further allow for better management of power demand and supply, he said, adding that collectively, these all interventions shall allow for an improved transfer of power within the state by improving the reliability and quality of the power supply.

The Program would strengthen the Environmental and Social systems applicable to the state’s power sector to allow for better monitoring and evaluation of these aspects.

He said: “The focus would also be to work further on detailed Environmental and Social assessments based on the gap analysis of the existing norms, regulations, and the existing studies. Under this World Bank-supported Program there is  no new investment in hydropower is envisaged, but the program will help the state develop uniform Environment and Social Policy and Procedures for the power sector utilities and provide benchmarks for the sustainable development of renewable energy in the state.”

Further, this program will also aim to encourage more women’s participation in the State Power Sector, he added.

 The Chief Minister said that negotiations for this loan for the “Himachal Pradesh Power Sector Development Program” were concluded between the Department of Economic Affairs, (DEA), GoI, World Bank, and the Government of Himachal Pradesh on 27th May, 2023.