CM Sukhu pushes for rightful ownership of century-old power project, highlights historical and legal aspects of the dispute
Mandi: Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu has called for transferring the historic 110 MW Shanan Power Project from Punjab to Himachal Pradesh, citing the expiration of the century-old lease. During his visit to the Shanan Power House in Jogindernagar, District Mandi, the Chief Minister asserted that the time has come for the Punjab government to hand over control to Himachal, as the lease agreement that allowed Punjab to operate the project has ended.
“The Shanan project has been in operation for over 100 years, and now, with the lease expiring, it is only fair that it is returned to Himachal Pradesh,” Sukhu stated while addressing the media. He emphasized that the project does not fall under the Punjab Reorganization Act, which governs the division of assets and liabilities between Punjab, Haryana, and Himachal Pradesh after the reorganization of the state in 1966. The Punjab government, however, has appealed the matter in the Supreme Court, seeking to retain control of the power project. Sukhu reaffirmed that the Himachal Pradesh government would respect the court’s decision but stressed the need for rightful ownership.
Historical Background of the Shanan Power Project
The Shanan Power Project, located in the Mandi district of Himachal Pradesh, was commissioned in 1932 under a lease agreement. The agreement granted control of the project to the Punjab government for 99 years, which expired in March 2024. Designed to harness hydroelectric power from the Uhl River, it was one of the earliest hydroelectric projects in India and played a significant role in powering the northern region. Over the years, it has supplied electricity primarily to Punjab and other neighbouring states.
The project is unique because it utilizes a high-head hydroelectric system, with water drawn from the Uhl River through a tunnel system into a reservoir, where it is used to generate electricity. The Shanan project was a pioneering achievement in hydroelectricity when it was first constructed and has been a key energy source for Punjab.
The Dispute Between Punjab and Himachal
The dispute over the Shanan Power Project centers on ownership rights and the original lease terms. While the project is physically located in Himachal Pradesh, it has been operated by Punjab since its inception. Following the expiration of the lease, Himachal Pradesh claims that it should assume full control of the project, as the lease no longer holds. The Punjab government, however, has contested this, arguing that its historical operation of the project should allow it to retain control.
In its legal battle, Punjab has sought intervention from the Supreme Court, asking for an extension of the lease or for the project to be considered under the Punjab Reorganization Act, which would give Punjab partial rights to its assets even after reorganization. Himachal Pradesh, on the other hand, maintains that the act does not apply to the Shanan Power Project, as the lease predates the 1966 reorganization.
Chief Minister Sukhu, during his visit, underscored the importance of the Shanan Power Project for Himachal Pradesh’s energy needs and economic interests. “It is time for the project to be returned to its rightful owners. The government of Himachal Pradesh will continue discussions with Punjab, but we are confident that our case for the transfer is strong,” he said.
As both states await the Supreme Court’s ruling on the matter, the future of the Shanan Power Project remains uncertain. However, CM Sukhu’s visit and strong push for the transfer signal the Himachal Pradesh government’s determination to gain control of one of the state’s most significant energy assets.
