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Informist, Tuesday, Jul. 28, 2026

 

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--Tata Power: Crossed 1,000 MW in module production for the first time
--Tata Power: Q2 will see huge ramp up in commissioning of projects
--Tata Power: To spend half of FY27 capex in renewable power sector
--Tata Power: See power demand strong going ahead
--Tata Power: Spent INR 53 bln in Q1, to spend INR 250 bln in FY27 as capex
--Tata Power: Expect new bids from NTPC for pumped hydro projects
--Tata Power: In advanced stage to get OK for Mundra's revised PPA by Sept
--CONTEXT: Comments by Tata Power mgmt in post earnings analyst call
--Tata Power: To add 2.5 GW of green power in FY27, reach 9.5 GW capacity

 

By Sunil Raghu and Shruti Nair

 

AHMEDABAD/MUMBAI – Tata Power Co. Ltd. hopes Cabinets of all four governments of states, to which it supplies electricity from its 4,000-megawatt Mundra plant, will approve a proposed supplemental power purchase agreement by the end of September, the company's management told analysts in a post-earnings analysts call.

 

"We are in a very advanced stage of getting approval from three states, expecting that in the month of August, we should have the cabinet approval for some three states and the fourth stage will happen in September," the management said. "All of the procurers are taking full capacity from the plant and they are 100% convinced that this is the most sustainable plant in the long run in terms of its tariff and in terms of merit orders, and we are very confident that we will run this plant continuously now up to 2038."

 

Tata Power supplies electricity from its Mundra plant to Gujarat, Rajasthan, Maharashtra, Haryana, and Punjab. These power purchase agreements are based on a fixed tariff and do not allow the company to pass on any increase in the cost of imported coal to buyers. Over the years, the company has shut operations more than once, as it made huge losses operating the plant. In March, the company announced a new supplemental power purchase agreement with the Gujarat government that allowed it to charge the cost of fuel as pass through. Tata Power said that it would enter into similar arrangements with other states, too.

 

Alternatively, the company could operate the Mundra plant only when the government imposes Section 11 of the Electricity Act, 2003. The provision allows the government to ask power producers to maintain operations to prevent any outages in case of a shortage. The provision was extended several times since 2003. The provision also allows power producers to recover the actual fuel cost from buyers. The government imposed Section 11 from Apr. 1 to meet electricity needs during summers and compelled Tata Power to restart operations at Mundra.  More

s. The government imposed Section 11 from Apr. 1 to meet electricity needs during summers and compelled Tata Power to restart operations at Mundra.

 

 

The company said it spent INR 53 billion on capital expenditure in the June quarter and was confident of spending INR 250 billion in capital expenditure during the current financial year. For FY27, the company hopes to add nearly 2.5 gigawatts to its portfolio of renewable power, taking its total capacity to near 9.5 GW. "Maybe if everything goes well, it (capex) will be closer to 6,500 crores (INR 65 billion). Almost half of that will go in the renewable business because as we mentioned, we are trying to commission almost 800 to 900 megawatt in quarter 2. So, that will assume a lot of Capex," the company's management said. 

 

On the renewable perspective, the company said it made a good progress with regard to land and connectivity. "As we speak, while in the first quarter, we have commissioned 226 megawatts, but we already have a line-up size for 500 megawatts where the project is almost ready. We are just in the final phase that will happen in week or two. So I think quarter two will see a huge and big ramp-up in our commissioning," the company official said.

Other than the rooftop solar, the company's management said that work on pumped storage projects is also "accelerating" and that they already have 2,700-kilometre of transmission lines with a capital expenditure of INR 20 billion in the pipeline during the second quarter of FY27. They also see commissioning of several ongoing projects in the September quarter. 

 

Talking of production at its solar module manufacturing units at Tamil Nadu and Bengaluru plants, the company said they have crossed manufacturing modules with a capacity of 1,000 megawatt in the June quarter. On the commissioning of pumped hydro projects, the management said that they expect it at the beginning of calendar year 2039, with three of them commissioning at a gap of two months each. While one of the units of 330 MW has been tied up, the company is in talks with Tata Steel and others for sale of power from other two units. "We are expecting now new bids to come from NTPC and others for pumped hydro," the management said.

 

The thermal and renewable power generating, transmission, solar cell and module maker reported a better-than-expected net profit of INR 11.76 billion for the June quarter, up nearly 11% on year. Its revenue from operations for the quarter rose 5.6% on year to INR 190.51 billion, above analysts' expectations of INR 185 billion.

 

At 1328 IST, shares of the company traded at INR 370 per share on the National Stock Exchange, down around 2%.  End

 

Edited by Deepshikha Bhardwaj and Akul Nishant Akhoury

 

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