📷 Image: Wikimedia Commons / Ssmithpowercom
Business
Punjab's Free Power Scheme Pushes Powercom into ₹10,000 crore Debt
✍️ Amar Ujala · Punjab
🗓 09 Sep 2026, 09:40 AM
👁 10
The state’s free electricity programme has left Powercom with a ₹9,650 crore dues to the government and forced it to seek a fresh ₹10,000 crore loan.
Punjab continues to provide free electricity to residential consumers under a subsidised scheme launched by the state government. While the initiative aims to ease the burden on households, the cost of supplying power without charge has fallen heavily on the state utility, Powercom.
Powercom now reports a liability of roughly ₹9,650 crore to the Punjab government, reflecting the accumulated arrears from the free‑power programme. The mounting dues have strained the company's cash flow and eroded its working capital.
To bridge the financing gap, Powercom has approached banks and financial institutions for a fresh loan of about ₹10,000 crore. The proposed borrowing is intended to settle outstanding dues, maintain uninterrupted supply and fund short‑term operational needs.
State officials acknowledge the fiscal pressure and say a review of the free‑power model is underway to ensure long‑term sustainability. Meanwhile, industry analysts warn that the added debt could limit Powercom’s capacity to invest in network upgrades unless corrective measures are taken.
Powercom now reports a liability of roughly ₹9,650 crore to the Punjab government, reflecting the accumulated arrears from the free‑power programme. The mounting dues have strained the company's cash flow and eroded its working capital.
To bridge the financing gap, Powercom has approached banks and financial institutions for a fresh loan of about ₹10,000 crore. The proposed borrowing is intended to settle outstanding dues, maintain uninterrupted supply and fund short‑term operational needs.
State officials acknowledge the fiscal pressure and say a review of the free‑power model is underway to ensure long‑term sustainability. Meanwhile, industry analysts warn that the added debt could limit Powercom’s capacity to invest in network upgrades unless corrective measures are taken.