The Auditor General of Pakistan has reported losses exceeding Rs128 billion at the Neelum Jhelum Hydropower Project during fiscal year 2024–25, citing shutdowns, tunnel collapses, rising debt, and operational failures. The audit said these issues severely weakened the project’s financial viability.
The 969-megawatt project posted net losses of Rs29.41 billion during the year. Business interruption losses reached Rs99.18 billion after the powerhouse remained shut following the tailrace tunnel collapse in 2022 and the headrace tunnel failure in May 2024. The audit noted that authorities have not completed inquiries into either incident.
Auditors said project management failed to fix technical defects, renew insurance coverage, or secure compensation for structural damage. Assets worth Rs267 billion remained uninsured during the review period. The report also found that the plant missed its annual generation target of 5,150 gigawatt-hours every year since commissioning.
The absence of a reference tariff approved by National Electric Power Regulatory Authority caused an estimated Rs77.35 billion revenue shortfall. As of June 30, 2025, current liabilities exceeded current assets by Rs307.89 billion due to repayment defaults and loan reclassification.
By FY2024–25, the project recovered Rs180.17 billion against an approved cost of Rs418.89 billion. The audit concluded that weak risk management, delayed tariffs, and prolonged outages blocked financial and operational goals.
