Chandigarh, May 29 -- The state power regulator has rejected a proposal by the Haryana Power Utilities to procure 340-megawatt (MW) of electricity from seven hydroelectric projects for a period of 40 years, citing uncertainty over tariffs, possible scheduling delays, and cost overruns impacting consumers with higher power costs. The Haryana Power Purchase Centre (HPPC), a joint forum of Uttar and Dakshin Haryana Bijli Vitran Nigams which procures power on the behalf of state's two power distribution companies petitioned the Haryana Electricity Regulatory Commission (HERC) seeking source approval and approval of the power purchase agreement to procure 340 MW hydro power from Dibang multipurpose project (167 MW), Teesta-VI (30 MW), Rangit IV (11 MW), Ratle (21 MW), Pakal Dul (39 MW), Kwar (35 MW) and Kiru (37 MW) from NHPC for a period of 40 years at tariff to be determined by Central Electricity Regulatory Commission (CERC). In its May 26 order, the commission expressed concern regarding the high level of uncertainty inherent in large-scale hydro projects stating that these projects were frequently subject to geological surprises, which lead to substantial scheduling delays and cost overrun, potentially making the power unaffordable. "HPPC was advised to exercise necessary commercial and financial prudence with regard to the expected tariff from the projects considering escalation in project cost and uncertainties, geological surprises associated with the hydro projects including exploring options to incorporate suitable provisions regarding ceiling tariff or ceiling capital cost and exit clauses in case of inordinate delay in commissioning or determination of excessively high tariff to safeguard the interests of Haryana consumers. However, HPPC has failed to pay due heed to the same,'' the commission said. The regulator also took note of the fact that the two power distribution companies are already burdened with deferred Fuel and Power Purchase Adjustment Surcharge (FPPAS) amounting to Rs.6,790 crore as on March 31, 2026. "The higher power purchase cost will increase this bucket of deferred FPPAS to a level which will be difficult to realise from the consumers without giving them a tariff shock," reads the order signed by commission's chairperson, Nand Lal Sharma and members, Mukesh Garg and Shiv Kumar. The regulator said that upon examination of the facts placed on record and deliberations made by HPPC as well as respondent - NHPC ( formerly National Hydroelectric Power Corporation), the proposal of HPPC has failed in the assessment of project viability and cost, given the uncertainties that exists in hydro projects on account of geological surprises. "All source of hydro power proposed by HPPC (Dibang, Teesta-VI, Rangit IV, Ratle, Pakal Dul, Kwar and Kiru) are either marred by the uncertainty or characterized by high expected tariff which shall be determined by CERC taking into consideration of time overrun. The commission is of the considered view that with the proliferation of better energy storage techniques, more offers are likely to come up at cheaper rates, which will enable Haryana power distribution companies to supply affordable electricity to its consumers. The tariff in power exchange is also expected to come down in the long term with the proliferation of cheaper sources of power,'' the commission said. The regulator said the proposal under consideration failed to satisfy the essential parameters of providing affordable power and ensuring certainty regarding the commercial operation date of the project. "In these circumstances, grant of unconditional consent for procurement of power would not be justified at this stage. Accordingly, the present petition stands disallowed. However, HPPC after conducting a thorough cost-benefit analysis, may approach this commission seeking necessary approvals as soon as certainty regarding the tariff is established. Also the possibility of procuring readily available hydro power through bids may be explored,'' it said....