The Kerala State Electricity Board (KSEB) has approved a capital investment outlay of ₹64.78 billion (~$721.75 million) for the financial year 2026–27, an increase from the revised allocation of ₹47.89 billion (~$533.62 million) for 2025–26.

The investments span power generation, transmission, distribution, IT systems, and other infrastructure works, while state-supported projects remain subject to the release of government funds.

Generation

The generation segment has been allotted ₹8.49 billion (~$94.5 million) for 2026–27, compared with a revised ₹5.88 billion (~$65.4 million) in 2025–26. Hydropower projects account for the bulk of this allocation, covering ongoing programs such as Mankulam, Thottiyar, Pazhassi Sagar, Upper Sengulam, and Chinnar, as well as new and preparatory hydel projects.

Thermal generation has been allocated ₹30 million (~$334,000), primarily for the Kayamkulam Diesel Power Project. Renovation and modernization of existing hydel stations, including Kuttiyadi–Kakkayam and Idukki Stage I, account for ₹2.80 billion (~$31.1 million). Other renewable energy projects, including solar, wind, PM-KUSUM, and SOURA programs, together receive ₹3.60 billion (~$40 million).

Additional generation-related works, such as dam safety, desiltation, environmental studies, and DRIP projects, have been allocated ₹3.07 billion (~$34.2 million).

Transmission

KSEB has earmarked ₹11.75 billion (~$130.7 million) for transmission infrastructure in 2026–27, up from a revised ₹8.31 billion (~$92.4 million) in 2025–26. TransGrid 2.0 projects account for the largest share at ₹5.99 billion (~$66.6 million), aimed at strengthening high-capacity transmission corridors across the state.

Conventional transmission works receive ₹4.64 billion (~$51.6 million), while system operation works are allocated ₹828 million (~$9.21 million). Power System Development Fund projects have been allotted ₹301 million (~$3.35 million), reflecting continued efforts to improve grid stability and reliability.

The Kerala State Electricity Regulatory Commission recently ruled that intrastate power transmission projects costing above ₹2.5 billion (~$28.2 million) must be executed through the tariff-based competitive bidding route.

Distribution

The distribution segment has been allocated ₹16.69 billion (~$185.7 million) for 2026–27, lower than the revised ₹17.73 billion (~$197.2 million) for 2025–26. The Dyuthi program, including special packages, accounts for ₹12.69 billion (~$141.2 million).

Other funded works receive ₹1 billion (~$11.1 million), while estimated distribution works account for ₹3 billion (~$33.4 million). These investments are intended to improve last-mile connectivity, reduce outages, and strengthen local distribution networks.

IT Works and RDSS

IT systems and digital infrastructure form the largest component of KSEB’s capital plan, with a total allocation of ₹23.46 billion (~$261 million) for 2026–27, higher than the revised ₹13.48 billion (~$150.0 million) in 2025–26.

IT-enabled services receive ₹669 million (~$7.44 million), while the Revamped Distribution Sector Scheme (RDSS) accounts for ₹22.79 billion (~$253.6 million). Under RDSS, ₹13.66 billion (~$151.9 million) is allocated for distribution infrastructure works, ₹637.9 million (~$7.10 million) for sub-transmission infrastructure, ₹1.00 billion (~$11.1 million) for smart meter implementation, ₹975.6 million (~$10.9 million) for IT/OT projects, and ₹6.43 billion (~$71.5 million) for SCADA systems.

Project management agency charges amount to ₹88.8 million (~$988,000).

Other Works

A total of ₹4.39 billion (~$48.8 million) has been earmarked for other works, compared with ₹2.09 billion (~$23.3 million) in the revised 2025–26 plan. This includes ₹1.70 billion (~$18.9 million) for mechanical fabrication works, ₹1.12 billion (~$12.5 million) for institutional development programs, ₹1.70 billion (~$18.9 million) for battery energy storage systems, and ₹5.20 billion (~$57.9 million) for electric vehicle charging stations.

Additional funds are directed towards administrative buildings, flood resilience measures, safety-related works, and renovation of substations and offices.

Revised 2025–26 Plan

The revised capital investment plan for FY26 has been scaled down to ₹47.90 billion (~$532.9 million) from the originally approved ₹58.81 billion (~$654.1 million), primarily due to project deferments, slower execution in certain generation programs, and the postponement of state-supported initiatives.

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