J&K CM rules out electricity privatisation, pledges reforms in sector

Jammu and Kashmir Chief Minister Omar Abdullah has dismissed speculation about privatisation of electricity in the Union territory, and said his vision is to strengthen and reform the power sector.

"We are not talking about privatisation. If we reduce our losses, improve billing efficiency and enhance revenue generation, there will be no need for it. My vision is to strengthen and reform the power sector in J&K," Abdullah said.

The CM addressed the gathering at the 58th Engineers' Day at SKICC here on late Monday evening.

The event was held to honour the legacy of Bharat Ratna Sir M Visvesvaraya for his pioneering contribution to engineering in India.

The chief minister said electricity generation and efficient distribution hold the key to economic prosperity in J&K.

Emphasising the critical role of the power sector, Abdullah underscored the need for J&K to reduce its power losses and then focus on harnessing its vast hydropower potential to strengthen its economy.

"This is the only way to change the financial situation of J&K. We should generate electricity and sell it to other regions, especially when their production is low. But to achieve this, we must first bring down losses in the power sector," he added.

Highlighting the challenges of hydropower vis-a-vis renewable energy, the CM said the installed cost of hydroelectricity is very high, though the per-unit cost reduces over time.

With solar power now available at Rs 2 to Rs 2.5 per unit, competing becomes difficult. But, hydropower remains our only viable resource, and we must continue developing projects alongside improving efficiency," he said.

The chief minister reaffirmed that tariff rationalisation should be guided by people's capacity to pay, ensuring that the rich contribute more while the poor pay less.

Abdullah said he chose to hold the Power department with himself "because if we really want to make J&K prosperous, the most important sector is the Power Development Department".

"I request you to maintain the momentum in reducing losses and improving efficiency," he told the gathering.

The chief minister lauded landmark hydropower initiatives like the Baglihar hydro-electric project, which transformed J&K's power scenario despite challenges, including lack of counter guarantees.