Audit report reveals Rs128 bn loss at Neelum-Jhelum Hydropower Project

The Auditor General of Pakistan's audit report revealed that the 969MW Neelum-Jhelum Hydropower Project suffered combined financial losses exceeding Rs. 128 billion, 24NewsHD TV reported on Monday. 

According to media reports citing the audit findings, this includes net operational losses of Rs. 29.41 billion and business interruption losses of Rs. 99.18 billion, largely stemming from prolonged power station shutdowns and tunnel collapses.

The report also noted that investigations into the repeated collapses of the headrace and tailrace tunnels have yet to be completed.

The audit report said the company's financial performance has been deteriorating since the 2022-23 fiscal year.

Electricity generation remained completely suspended from July 2022 to August 2023 after the collapse of the tailrace tunnel.

It further stated that the power house has remained shut since May 1, 2024, following the collapse of the headrace tunnel.

The cost of repairing and restoring both tunnels has added a significant financial burden to the project.

The report also highlighted that the project continues to face financial difficulties due to the absence of approval for its reference tariff by the National Electric Power Regulatory Authority (NEPRA).

The Auditor General has recommended that the pending investigations be completed without delay and that steps be taken to restore the power house to resume electricity generation at the earliest.