Tata Power Commits Rs 1,527 Crore For Bhutan's 1,125 MW Hydroelectric Power Project

Tata Power Co. has entered into a pact with Bhutan's Druk Green Power Corporation Ltd. or DGPC for a hydroelectric power project, according to a release issued on Friday.

The company will assist in the implementation of the 1,125 MW Dorjilung project with the help of a Special Purpose Vehicle and has committed an equity investment of Rs 1,572 crore to be infused in tranches, it said.

The total project cost amounts to Rs 13,100 crore, making Dorjilung Bhutan’s second-largest hydropower project, and the largest Public–Private Partnership (PPP) hydro project ever undertaken in the country, the filing stated.

While DGPC holds 60% equity shares, Tata Power owns 40% in the World Bank-backed project, which is slated for commissioning in Sept. 2031. Around 80% of the power generation will be supplied to India, the release stated.

"The Dorjilung project reinforces our commitment to accelerating clean energy development in the region. As Bhutan’s largest hydro project under the PPP model, it is designed to fully support Bhutan’s domestic energy aspirations while also enabling the export of surplus clean power to India, strengthening regional energy security," Tata Power Chief Executive Officer and Managing Director Praveer Sinha said.

Bhutan's second-largest hydropower project will be a run-of-the-river project, and will comprise six units of 187.5 MW each. It is being developed on the Kurichhu River in Mongar, Bhutan.

"Designed with a six-hour pondage for peaking, Dorjilung represents a major step forward in expanding clean, reliable hydropower in the region", the release stated.

"By combining Bhutan’s hydropower capabilities with India’s technical expertise, we are creating a future of reliable, clean energy that benefits both nations and sets a global benchmark in green cooperation", DGPC's MD Dasho Chhewang Rinzin remarked.

Shares of Tata Power ended 0.28% lower at Rs 387 apiece on the NSE on Friday. This compares to a 0.47% decline in the Nifty index.