Tata Power Co. entered into a strategic partnership on Tuesday with Druk Green Power Corp., a subsidiary of Druk Holding and Investments Ltd., to develop at least 5,000 megawatts of clean energy generation capacity in Bhutan.
The renewable energy projects include 4,500 MW of hydropower comprising the 1,125 MW Dorjilung HEP; 740 MW Gongri reservoir; 1,800 MW Jeri pumped storage; and 364 MW Chamkharchhu IV, which will be developed in phases together, according to an exchange filing.
Another 500 MW of solar projects will be developed by Tata Power Renewable Energy Ltd., a subsidiary of Tata Power, it said.
This partnership aligns with Bhutan's vision for its energy sector, which aims to increase its overall generation capacity to 25,000 MW by 2040, ensuring energy security and promoting regional energy integration.
Bhutan plans to achieve this target through diversification in its energy portfolio beyond traditional hydropower, which would include solar and geothermal energy. This will extend to diversifying project structuring and financing through such strategic partnerships.
With the support of the Bhutan and the Indian governments, this marks the largest partnership between two of the leading power companies of the two nations in Asia's clean energy sector, the filing said.
As a precursor to this collaboration, Tata Power recently acquired a 40% stake in the 600 MW Khorlochhu hydroelectric project.
Tata Power has had a long-standing relationship with DGPC since 2008 when the two companies joined forces to successfully develop the 126 MW Dagachhu hydropower plant as the first public private partnership in Bhutan's hydropower sector. Tata Power also has a transmission project of a 1,200-km-long Tala transmission line that evacuates clean power from Bhutan to India.
Shares of Tata Power closed 0.84% higher at Rs 408.10 apiece on the NSE, compared to a 0.28% advance in the benchmark Nifty 50.
Fourteen out of the 23 analysts tracking the company have a 'buy' rating on the stock, one recommends a 'hold' and eight suggest a 'sell', according to Bloomberg data.
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