Why would a state power utility keep competitively awarded contracts worth hundreds of crores in limbo while simultaneously pursuing fresh procurement through another route that complainants claim is significantly more expensive?
That is the central question emerging from a detailed representation submitted against the Punjab State Power Corporation Limited’s (PSPCL) smart meter procurement programme under the Centre’s Revamped Distribution Sector Scheme (RDSS).
The representation, supported by tender documents, comparative price analyses, and correspondence, has sought an independent investigation into PSPCL’s procurement decisions, alleging possible financial loss to the exchequer, deviations from the approved procurement framework, regulatory concerns, and potential cybersecurity risks.
At the heart of the controversy is Telecommunications Consultants India Limited (TCIL), a Government of India Mini Ratna public sector undertaking, which emerged as the lowest bidder (L1) for the Central package comprising approximately 4.52 lakh smart meters after quoting ₹328.84 crore—around 10 per cent below PSPCL’s estimated cost of ₹366.13 crore.
According to the documents reviewed by Tehelka, PSPCL issued a Letter of Award (LoA) to TCIL on January 30, 2026. TCIL subsequently furnished the mandatory Performance Bank Guarantee (PBG), completing the post-award formalities required for execution of the contract.
Yet, nearly six months later, the final agreement has allegedly not been signed.
The delay has prompted TCIL to formally seek intervention from Punjab’s top bureaucrats. In a letter (No. TCIL/DT/DCCS/PSPCL/1/2026) dated July 16, 2026, addressed to Punjab Chief Secretary K.A.P. Sinha, the PSU requested intervention for execution of the contract agreement. Earlier, on June 10, 2026, TCIL had written to PSPCL Chairman-cum-Managing Director Dr Basant Garg, urging the corporation to execute the contract.
The representation argues that TCIL is not an isolated case.
According to the complainants, other bidders also emerged as L1 in the remaining RDSS packages at rates substantially below PSPCL’s estimated costs. Yet, despite competitive bidding having discovered significantly lower prices, several awarded contracts have allegedly remained pending.
The obvious question, the complainants say, is: Why are awarded RDSS contracts yet to be executed?
RDSS versus CAPEX
The issue assumes significance because the RDSS procurement model is structurally different from conventional CAPEX procurement.
Under RDSS, the Central Government provides a grant of ₹900 per smart meter, while the remaining payments are spread over 93 monthly instalments after commissioning and are linked to the operational performance of the smart metering system.
The representation contends that this model substantially reduces the immediate financial burden on the utility while ensuring long-term accountability from the service provider.
However, despite these financial advantages, PSPCL has allegedly enhanced existing CAPEX purchase orders by nearly 40 per cent to procure around 3.20 lakh additional smart meters involving an estimated expenditure of ₹152 crore.
The complainants further point to fresh procurement initiated through tenders MQP-262 for approximately 4.5 lakh smart meters and MQP-263 for nearly one lakh Smart EMFA meters.
This, they argue, raises a fundamental question: Why opt for higher upfront CAPEX expenditure when competitively discovered RDSS contracts carrying Central Government support are already available?
The representation also cites reports that PSPCL is borrowing nearly ₹10,000 crore, arguing that any decision involving substantial upfront expenditure deserves greater public scrutiny.
What the Numbers Show
The comparative price statements attached with the representation indicate that every successful bidder under the RDSS tender quoted below PSPCL’s own estimated prices.
TCIL’s bid for the Central package was approximately 10.2 per cent lower than PSPCL’s estimate. Other successful bidders quoted between nearly 17 per cent and 28 per cent below the corporation’s benchmark costs.
The representation also compares the TOTEX (RDSS) and CAPEX procurement models, claiming that the weighted average monthly cost under the CAPEX model works out to nearly 40 per cent higher than the TOTEX model after excluding the ₹900 Central Government grant.
Based on these calculations, the complainants estimate that replacing or sidelining RDSS procurement in favour of CAPEX purchases could have financial implications exceeding ₹350 crore. They have called for an independent audit of these estimates.
Questions Over Regulatory Approval
The representation also questions whether the fresh CAPEX procurement is consistent with the Punjab State Electricity Regulatory Commission’s (PSERC) Multi-Year Tariff Order for FY 2026-29.
According to the complainants, the tariff order envisaged the rollout of consumer smart meters under the Government of India’s RDSS framework and did not approve fresh CAPEX expenditure for this purpose.
They have sought clarification on whether the necessary regulatory approvals and budgetary provisions were obtained before initiating the fresh procurement.
Cybersecurity Angle
Beyond procurement and finance, the representation raises another issue that it says requires urgent technical verification.
The complainants have alleged that the communication infrastructure associated with certain smart meters installed in Punjab may involve entities or infrastructure linked to Pakistan. They have urged the appropriate cybersecurity and national security agencies to independently verify where meter data is transmitted, processed and stored, whether GPS or location information is routed outside India, and whether the communication architecture complies with the Government of India’s cybersecurity framework for RDSS, telecom regulations and data protection norms.
Officials Under the Lens
The representation has sought an independent inquiry into the decision-making process involving senior PSPCL officials, including Chairman-cum-Managing Director Dr Basant Garg (IAS), Director (Finance) Rajesh Beri and Chief Engineer (Metering) Vikas Sharma.
Among the questions raised are why awarded RDSS contracts remain unexecuted despite the issuance of Letters of Award and submission of Performance Bank Guarantees; why fresh CAPEX procurement continues while RDSS awards remain pending; what approvals permitted the reported enhancement of CAPEX purchase quantities; whether PSERC approved the expenditure; what the financial impact would be if RDSS contracts are replaced; and whether the cybersecurity of deployed smart meters has been independently audited.
For the complainants, the issue extends far beyond a commercial disagreement.
They argue that it touches the core principles of transparent public procurement, value for taxpayers’ money, equal treatment of bidders, regulatory accountability and the protection of critical electricity infrastructure.
Tehelka reached out to PSPCL for its response to the allegations and the issues raised in the representation. No response had been received at the time this report went to press.
