Thiruvananthapuram: Differences over electricity procurement have emerged between Kerala Chief Minister V D Satheesan and Electricity Minister Sunny Joseph, with the minister supporting a proposal to purchase power from Himachal Pradesh instead of the alternative arrangement involving private power trading company GNA Energy. The disagreement centres on the cost, availability and reliability of electricity under the two proposed procurement arrangements. While Satheesan defended the GNA proposal as a cheaper option, Joseph and officials associated with the Kerala State Electricity Board (KSEB) raised concerns about its ability to meet the state's electricity requirements, particularly during evening peak hours.
The government has subsequently decided not to proceed with the proposed short term purchases from either GNA Energy or Himachal Pradesh following a reassessment of Kerala's immediate electricity requirements. The Himachal Pradesh proposal involved purchasing electricity generated by Himachal Pradesh Power Corporation Limited through PTC India Limited. The quoted rate was around Rs 14.50 per unit, with the proposed supply period extending from November 2026 to May 2027.
Joseph supported this arrangement, pointing to the availability of electricity when Kerala needed it most. He also said that electricity supplied from Himachal Pradesh had helped the state meet its requirements during October. The alternative proposal involved purchasing 500 megawatts of electricity through GNA Energy Private Limited. The proposed supply period was from November 2026 to March 2027.
Chief Minister VD Satheesan defended the GNA arrangement, citing rates of Rs 8.63 and Rs 8.90 per unit. He argued that the lower quoted prices could help Kerala reduce its electricity procurement costs compared with the Himachal Pradesh proposal. However, KSEB reportedly raised concerns about the timing and availability of electricity under the GNA arrangement. A significant part of the proposed supply involved solar power, which is mainly available during daylight hours.
The board questioned whether this supply profile would adequately meet Kerala's higher electricity demand during the evening. It also raised concerns that the state might have to purchase additional electricity during peak hours, increasing the overall procurement cost. The disagreement therefore involved more than the difference between the quoted prices. The timing of electricity availability, transmission charges, additional purchases, supply reliability and the duration of the proposed arrangements were also important considerations.
The controversy intensified after the government decided to step back from the proposed short term procurement arrangements. On November 9, Joseph said he had learned about the government's position through media reports. On November 11, Satheesan clarified that no formal electricity purchase agreement had been signed with GNA Energy. He said the government had not issued an order committing itself to the proposed purchase.
The Chief Minister also indicated that Kerala did not require immediate additional electricity procurement during November and December, although demand could increase in the following months. He maintained that the government would purchase electricity when necessary and select the most economical available option. The dispute also brought attention to the role of KSEB officials in the procurement process. Former KSEB chairman and managing director M G Rajamanickam reportedly supported the Himachal Pradesh proposal and raised concerns about the GNA arrangement.
Rajamanickam's removal from the KSEB chairman and managing director position attracted attention because it followed his reported opposition to the proposed GNA procurement. However, the circumstances surrounding his removal have not been independently established as retaliation for his position. The controversy has also raised questions about the government's administrative and regulatory procedures. Electricity purchases by distribution companies in Kerala are governed by regulations issued by the Kerala State Electricity Regulatory Commission. These rules provide for approval procedures and certain exceptions for emergency short term purchases.
However, there has been no established public confirmation that the regulatory commission formally rejected the GNA proposal. Questions about the procurement process and the status of any required regulatory approval therefore remain. The issue has also drawn criticism from the opposition. Former Kerala Chief Minister and opposition leader Pinarayi Vijayan questioned the government's approach to the GNA proposal and alleged that the electricity shortage had been exaggerated to benefit private power companies. These allegations have not been independently established.
Meanwhile, Kerala continues to depend on electricity purchases from outside the state to meet its requirements. Reports citing KSEB data indicated that the state purchased around 800 megawatts from outside on Monday and approximately 700 megawatts on Tuesday and Wednesday. The government is also exploring longer term electricity procurement options. One proposal involves securing 540 megawatts from Maharashtra's Sinnar Thermal Power Plant through two units of 270 megawatts each.
KSEB initially sought 300 megawatts from the plant before requesting an increase to 540 megawatts. However, the additional allocation and revised arrangement were awaiting confirmation from Maharashtra State Power Generation Company Limited. The proposal should therefore not be considered a completed electricity purchase agreement. Kerala's electricity requirements remain a concern as demand is expected to increase during the summer of 2027. The state recorded a peak electricity demand of 6,195 megawatts on April 23, 2026.
Although the immediate supply situation reportedly improved in October, this does not remove the need for reliable procurement planning for the coming months. Differences between Satheesan and Joseph have reportedly eased following discussions between the two leaders. However, questions remain about the state's electricity procurement strategy, the role of KSEB in assessing future requirements and the need to balance lower prices with reliable supply.
For Kerala, the main challenge is to secure sufficient electricity at a reasonable cost while ensuring uninterrupted supply during periods of high demand. The government's next procurement decisions will be important in determining how effectively the state prepares for the coming summer.