Srinagar, Jan 1: Jammu and Kashmir’s power sector generated revenue of Rs 3208.71 crore during the current financial year 2025-26 up to November, with around Rs 385.69 crore realised in the month of November alone, official figures show.
During the same period, the Jammu and Kashmir State Power Development Corporation (JKSPDC) generated 4255.47 million units (MU) of hydel power up to the end of November 2025.
Despite these figures, J&K’s power sector is grappling with an acute financial crisis, with a projected revenue gap of over Rs 4200 crore for FY 2025-26, driven primarily by a sharp decline in local power generation and a steep rise in the cost of electricity imports.
Electricity generation from locally owned projects and NHPC-operated hydropower plants has fallen by nearly 70 percent due to reduced water discharge in rivers.
This shortfall has forced Jammu and Kashmir to import nearly 3000 MW of power from outside sources, significantly increasing the financial burden on the distribution utilities.
The shift from relatively inexpensive local hydropower to costly imported electricity has sharply pushed up expenditure.
Power purchase cost, including transmission charges, has been projected at Rs 5924.15 crore for FY 2025-26, up from Rs 5620.88 crore in the current fiscal.
This component alone accounts for about 87 percent of the total revenue requirement of the power sector.
The Annual Performance Review for FY 2024-25 and the Aggregate Revenue Requirement for FY 2025-26 place the total revenue requirement at Rs 6827.18 crore.
However, revenue realisable at existing tariffs, even with an assumed collection efficiency of 93 percent, has been estimated at just Rs 2688.99 crore, leaving a revenue gap of Rs 4136.03 crore.
“The revenue gap remains a serious concern for the power sector in J&K,” a senior official of Kashmir Power Distribution Corporation Limited said. “Despite efforts to improve operational efficiency and reduce losses, the rising cost of power purchase and inadequate recovery through existing tariffs continue to exert tremendous pressure on the system.”
One of the biggest structural challenges continues to be extremely high distribution losses. Aggregate Technical and Commercial (AT&C) losses are projected to decline only marginally from 47.79 percent to 46.41 percent in FY 2025-26, nearly three times the national average of 15-20 percent.
This implies that of every 100 units of electricity purchased, fewer than 54 units are actually billed and realised, with the rest lost to technical inefficiencies, theft, and billing gaps.
Officials attribute the collapse in local generation to multiple factors, including sharp seasonal variations in water flows, prolonged maintenance shutdowns at key generating stations, ageing infrastructure, and reduced water availability linked to changing precipitation patterns.
Delays in planned capacity additions due to environmental clearances and funding constraints have further compounded the problem.