diff --git a/drivers/gpu/drm/i915/display/intel_display_regs.h b/drivers/gpu/drm/i915/display/intel_display_regs.h
index 4746e9ebd920..dada8dc27ea4 100644
--- a/drivers/gpu/drm/i915/display/intel_display_regs.h
+++ b/drivers/gpu/drm/i915/display/intel_display_regs.h
@@ -2263,6 +2263,7 @@
 #define TRANS_DP2_CTL(trans)			_MMIO_TRANS(trans, _TRANS_DP2_CTL_A, _TRANS_DP2_CTL_B)
 #define  TRANS_DP2_128B132B_CHANNEL_CODING	REG_BIT(31)
 #define  TRANS_DP2_PANEL_REPLAY_ENABLE		REG_BIT(30)
+#define  TRANS_DP2_PR_TUNNELING_ENABLE		REG_BIT(26)
 #define  TRANS_DP2_DEBUG_ENABLE			REG_BIT(23)
 
 #define _TRANS_DP2_VFREQHIGH_A			0x600a4
diff --git a/drivers/gpu/drm/i915/display/intel_psr.c b/drivers/gpu/drm/i915/display/intel_psr.c
index 998c3faf5f2e..a927b73c3f6e 100644
--- a/drivers/gpu/drm/i915/display/intel_psr.c
+++ b/drivers/gpu/drm/i915/display/intel_psr.c
@@ -44,6 +44,7 @@
 #include "intel_dmc.h"
 #include "intel_dp.h"
 #include "intel_dp_aux.h"
+#include "intel_dp_tunnel.h"
 #include "intel_dsb.h"
 #include "intel_frontbuffer.h"
 #include "intel_hdmi.h"
@@ -1031,11 +1032,27 @@ static u8 frames_before_su_entry(struct intel_dp *intel_dp)
 	return frames_before_su_entry;
 }
 
+static bool intel_psr_allow_pr_bw_optimization(struct intel_dp *intel_dp)
+{
+	if (intel_dp_is_edp(intel_dp))
+		return false;
+
+	if (!intel_dp_tunnel_bw_alloc_is_enabled(intel_dp))
+		return false;
+
+	if (!intel_dp_tunnel_pr_optimization_supported(intel_dp))
+		return false;
+
+	return true;
+}
+
 static void dg2_activate_panel_replay(struct intel_dp *intel_dp)
 {
 	struct intel_display *display = to_intel_display(intel_dp);
 	struct intel_psr *psr = &intel_dp->psr;
 	enum transcoder cpu_transcoder = intel_dp->psr.transcoder;
+	u32 dp2_ctl_set = TRANS_DP2_PANEL_REPLAY_ENABLE;
+	u32 dp2_ctl_clear = 0;
 
 	if (intel_dp_is_edp(intel_dp) && psr->sel_update_enabled) {
 		u32 val = psr->su_region_et_enabled ?
@@ -1048,12 +1065,16 @@ static void dg2_activate_panel_replay(struct intel_dp *intel_dp)
 			       val);
 	}
 
+	if (intel_psr_allow_pr_bw_optimization(intel_dp))
+		dp2_ctl_set |= TRANS_DP2_PR_TUNNELING_ENABLE;
+	else
+		dp2_ctl_clear = TRANS_DP2_PR_TUNNELING_ENABLE;
+
 	intel_de_rmw(display,
 		     PSR2_MAN_TRK_CTL(display, intel_dp->psr.transcoder),
 		     0, ADLP_PSR2_MAN_TRK_CTL_SF_CONTINUOS_FULL_FRAME);
 
-	intel_de_rmw(display, TRANS_DP2_CTL(intel_dp->psr.transcoder), 0,
-		     TRANS_DP2_PANEL_REPLAY_ENABLE);
+	intel_de_rmw(display, TRANS_DP2_CTL(intel_dp->psr.transcoder), dp2_ctl_clear, dp2_ctl_set);
 }
 
 static void hsw_activate_psr2(struct intel_dp *intel_dp)