Smart grids are modern power distribution systems that utilize advanced technologies to optimize energy generation, distribution, and consumption. The huge amount of data generated by various sources, such as smart meters, sensors, and other devices, can be aggregated for efficient energy management, supporting demand response etc. However, this data can contain sensitive information about individual’s energy usage patterns, behaviour, and preferences, which raises several privacy concerns. Data reliability is another major issue, as the data send from the smart meters to the aggregators may get corrupted due to errors introduced by the communication channel. In this paper, a private-key additive homomorphic encryption scheme based on polar codes is proposed for privacy preserving data aggregation. The proposed scheme not only ensures data confidentiality but also provide data reliability. The security of this scheme relies on the difficulty in decoding the codeword and is achieved by embedding security in the generator matrix and error vector. Security analysis shows that the proposed scheme is resistant against all known attacks against private-key code-based cryptosystems. The performance analysis is evaluated in terms of error performance, communication overhead and computational complexity. The performance comparison with related additive homomorphic encryption scheme shows the efficiency of the proposed scheme.