Audit Report Exposes Massive Neelum-Jhelum Hydropower Financial Losses

ISLAMABAD: (Special Reporter) – Pakistan’s Auditor General has revealed that the Neelum-Jhelum Hydropower Company suffered losses exceeding Rs. 29.41 billion, highlighting the project’s worsening financial condition.

The audit report attributes a major portion of the losses to the prolonged shutdown of the power house, which resulted in an estimated Rs. 99.17 billion in lost revenue. It also points out that investigations into the repeated collapses of the headrace and tailrace tunnels remain unfinished.

The report says the company’s financial performance has steadily deteriorated since the 2022–23 fiscal year. Power generation was completely suspended between July 2022 and August 2023 after the tailrace tunnel collapsed. Following another failure involving the headrace tunnel, the facility has remained out of operation since May 1, 2024.

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According to the audit, the cost of repairing and restoring both tunnels has placed an even greater financial strain on the project. It also notes that the absence of an approved reference tariff from NEPRA has added to the company’s financial challenges.

The report further states that insurance claims related to the tunnel failures were not successfully recovered. The Auditor General has urged authorities to complete the pending investigations without further delay and restore the power house to full operation.