Electricity Rates in Himachal Pradesh Set to Rise from April as Proposal Seeks Increase of 50 to 70 Paise per Unit

Shimla: Electricity prices in Himachal Pradesh may see a hike starting in April 2025, as the Himachal Pradesh Electricity Board has submitted a proposal to the State Electricity Regulatory Commission (SERC) to increase rates by 50 to 70 paise per unit. This request follows a significant financial shortfall, with the board citing a loss of approximately Rs 300 crore.

The proposed increase in rates will affect domestic and other category consumers, who currently pay electricity rates that have remained unchanged this year. Although the state government provides a substantial grant of Rs 750 to 1000 crore annually to the electricity board, meeting the board’s expenses remains challenging. A major portion of the board’s monthly expenditure, around Rs 180 crore, is allocated for salaries and pensions. With a growing revenue deficit, the financial situation of the board has become increasingly precarious.

The board has attributed its financial struggles in part to the provision of 125 free units of electricity per month to consumers, which has strained its budget further. Despite these difficulties, the board continues to supply electricity to around 25 lakh consumers, including domestic users and other categories.

Stakeholder Consultation and Public Hearing

The SERC has now scheduled a public hearing where stakeholders will have the opportunity to submit suggestions and objections regarding the proposed rate hike. This hearing is an essential part of the process, as it will allow the public, consumer groups, and other interested parties to voice their opinions before any decisions are made.

It is worth noting that the board did not raise electricity rates during the year 2024, largely due to the upcoming Lok Sabha elections. However, with the financial pressures mounting, the board has now pushed for the rate hike to address the mounting deficit.

The Impact of Previous Rate Increases

In the 2023-24 period, the State Electricity Regulatory Commission had previously raised electricity rates by 75 paise to one rupee per unit, with the state government compensating for the increase through additional subsidies. For the upcoming 2025-26 period, the board is proposing another increase to cover its financial losses. Domestic consumers who used more than 125 units saw an increase of 22 paise per unit, while other categories faced a 46 paise per unit hike.

These adjustments, which will remain in place until March 2025, are part of the board’s ongoing efforts to manage the financial challenges arising from its operational costs and the heavy subsidy burden imposed by the free electricity scheme.

As the public hearing draws near, residents of Himachal Pradesh will be keenly watching how the situation unfolds. The outcome of this proposal could significantly impact household budgets and the broader economic landscape of the state. Stakeholders’ feedback will play a crucial role in shaping the future of electricity pricing in the region.