Himachal and Telangana Sign Historic 520 MW Hydro Power Pact

In a groundbreaking development, Himachal Pradesh and Telangana have entered into a monumental partnership to unlock hydro power potential, marking the states’ first collaboration of this nature. This historic agreement signifies a crucial advancement in the states’ renewable energy strategies.

The Memoranda of Understanding (MoUs) were signed in Shimla by Secretary Power Rakesh Kanwar, representing the Himachal Pradesh Government, and Principal Secretary of Power Sandeep Kumar Sultania, representing the Telangana Government, in a ceremony attended by Chief Minister Thakur Sukhvinder Singh Sukhu and Telangana’s Deputy Chief Minister Bhatti Vikramarka Mallu.

The proposed projects, to be located on the banks of the Chenab River, are estimated to cost Rs 6,200 crore and aim to create approximately 5,000 job opportunities for local youth, both directly and indirectly.

According to the agreement, the Telangana Government has committed Rs 26 crore as an upfront premium. Under the state government’s new Energy Policy, Himachal Pradesh will receive free power distribution: 12 percent for the first 12 years, 18 percent for the subsequent 18 years, and 30 percent for the remaining 10 years. After 40 years, the projects will be transferred to Himachal Pradesh.

Furthermore, the Telangana Government will allocate 1.5 percent of the projects’ costs to the Local Area Development Fund (LADF) and provide an additional one percent of free power to LADF following the projects’ commissioning. Families affected by the projects are entitled to financial advantages, equating to 100 units per month over a decade.

Chief Minister Thakur Sukhvinder Singh Sukhu extended a warm welcome to Deputy Chief Minister Mallu, emphasizing that the agreement highlights unprecedented interstate cooperation in renewable energy. He encouraged further collaborations in power banking and trading, stressing the commitment to safeguarding state resources while ensuring hydro power projects align with public benefit.

“Our government is determined to prevent the exploitation of our resources,” said Chief Minister Sukhu, highlighting that Himachal Pradesh’s water resources are considered vital wealth. The government is focused on transformative reforms within the power sector to secure self-reliance for the state and to boost economic growth through resource utilization.

Though Himachal Pradesh has so far developed an energy capacity of 11,500 MW, much of it benefits Central Public Sector Undertakings. The existing government is eager to alter this, ensuring economic gains for local residents.

Telangana’s Deputy Chief Minister Mallu Bhatti Vikramarka reiterated their commitment to energy security and the state’s aspiration to expand its renewable energy framework in light of soaring demand. He reiterated that the MoU encapsulates the principles of the Telangana Clean and Green Energy Policy 2025, aimed toward a sustainable energy future.

“Partnering with Himachal Pradesh represents a pivotal move towards securing a cleaner, greener, and more resilient energy framework for the future,” he stated, recognizing the importance of inter-state cooperation for renewable energy expansion.

The event was attended by dignitaries including Health and Family Welfare Minister (Col.) Dhani Ram Shandil, Principal Advisor to the Chief Minister Naresh Chauhan, Telangana State Southern Power Distribution Company Limited’s Chief Managing Director Musharraf Faruqui, Director Energy Rakesh Prajapati, Special Secretary Power Arindam Chaudhary, and other senior officials from both states.