During the construction of Beas Satluj Link Project, it was observed that a power plant could be constructed at the exit of Pandoh - Baggi Tunnel (PBT) as sufficient head was available between Pandoh Reservoir and at the start of Sunder Nagar Hydel Channel (SNHC). Consequently, a by-pass tunnel upstream of Baggi Control Works (BCW) was constructed to divert the water for the prospective power plant.
A 6.1 diameter by pass tunnel is taken off from PBT at 170.3 m upstream of BCW at Baggi providing a Discharge of 170 cumecs for the proposed 2 x 20 MW Baggi Power House.
BBMB has revived the Baggi Power project.