Himachal Pradesh Inks 1,300 MW Electricity Pact with Rajasthan at ₹15.50/Unit
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In a landmark inter-state energy deal set to provide a massive fiscal windfall to the hill state's exchequer, Himachal Pradesh has formally entered into a major power supply agreement with the desert state of Rajasthan. Under the bilateral agreement, the Himachal Pradesh State Electricity Board (HPSEB) will supply up to 1,300 megawatts (MW) of electricity to Rajasthan through February 2027. Negotiated at a lucrative tariff of ₹15.50 per unit, the high-value transaction marks one of the most profitable seasonal energy transfers executed by the state in recent years, strategically capitalizing on peak interstate spot valuations to bolster non-tax revenues.
Revenue Surge: State Power Earnings Projected to Double to ₹3,000 Crore
The lucrative tariff locked in with Rajasthan is poised to transform Himachal Pradesh’s fiscal balance sheet for the ongoing financial year. Historically, the state has generated between ₹1,000 crore and ₹1,500 crore annually through the commercial liquidation of its surplus hydel power generation. With the 1,300 MW contract secured at premium rates alongside similar bilateral arrangements being negotiated by the Energy Department with other power-deficit states, officials project overall power export revenues to jump to nearly ₹3,000 crore—effectively doubling last year's earnings and providing vital liquidity to fund statewide development programs.
Winter Supply Realities: Balancing Rajasthan Commitments with Domestic Load
While the multi-crore deal represents an enormous financial win, it presents a complex operational challenge for grid managers as northern India enters the peak winter season. Hydropower generation across Himachal's mountain river basins naturally peaks during the high-discharge summer and monsoon months, tapering off sharply during winter when glacier-fed rivers freeze and flow volumes decline. Concurrently, domestic heating requirements drive localized power demand to its annual zenith during freezing sub-zero temperatures. To prevent local grid destabilization and fulfill external contractual obligations, the HPSEB will need to coordinate real-time power transfers to balance the heavy export quotas without compromising regional household distribution.
Shift from Traditional Power Banking to Strategic Market Purchases
To bridge the winter shortfall and honor outbound supplies, the Himachal Pradesh State Electricity Board is overhauling its seasonal procurement mechanisms. In previous years, the board leaned heavily on energy-banking arrangements with neighboring northern states—depositing summer surplus to draw return power during winter—or drew directly on the state government's sovereign equity share. Under the current operating paradigm, however, the board will actively purchase deficit energy from external merchant markets, the Indian Energy Exchange, and bilateral state grids. Despite the necessity of purchasing seasonal buffer electricity from outside sources, energy analysts confirm that the premium export margin of ₹15.50 per unit leaves Himachal Pradesh with a substantial net revenue surplus.
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