Punjab Electricity Duty Exemption (Large Units)

Under Clause 12.9 of the Industrial and Business Development Policy 2022 of Punjab, large units that qualify receive a complete waiver of electricity duty lasting 10 years. Two ceilings govern the exemption, and the lower of the two applies: either a 100% exemption for 10 years capped at 100% of Fixed Capital Investment, or a 100% exemption on the power consumption matching the electric load in KW needed for the installed capacity recorded in the approved DPR.

For new units, the ten-year period is reckoned from the date the power connection is released; for expansion cases, it runs from the date of commercial production after expansion.

Where a plant is energy-intensive, electricity duty forms a substantial share of the monthly power bill. A waiver running ten years therefore alters the unit economics of operating at full capacity in Punjab as against a neighbouring state.

- Secure approval of the project as an eligible unit under the Industrial and Business Development Policy 2022, ensuring the DPR states the installed capacity and electric load - Submit the power connection application and note the date of release (or the date of commercial production following expansion) - Submit the electricity duty exemption application through the Invest Punjab Business First portal - Enclose the approved DPR, particulars of fixed capital investment and PSPCL connection documents - Once sanctioned, PSPCL raises bills on the unit without electricity duty for the duration of the exemption period

The department operates a non-competitive route. It verifies that the applicant meets the policy's eligibility conditions, examines the DPR load together with the fixed capital investment to which the exemption is tied, and then issues the exemption certificate to the power utility.