Tata Power partners with Druk Green to develop 600 MW Khorlochhu Hydropower Project

The partnership involves a 40 percent equity investment by Tata Power in the Public Private Partnership Company, Khorlochhu Hydro Power Limited in Bhutan. The estimated project cost including financing charges is approximately ₹ 6900 Crore with a construction timeline of 5 years.

With the support of the Royal Government of Bhutan and the Government of India, Tata Power, one of India’s largest integrated power companies, has entered into a strategic partnership with Druk Green Power Corporation Ltd (DGPC) of Bhutan for the development of the 600 MW Khorlochhu Hydropower Project. The Project is located in the Trashiyangtse Dzongkhag (District) in Eastern Bhutan on the Kholongchhu River. While the clean power from the project will help meet Bhutan’s increasing electricity requirements, it will also complement and contribute to India’s energy transition to renewables.

The partnership involves a 40 percent equity investment by Tata Power in the Public Private Partnership Company, Khorlochhu Hydro Power Limited. The estimated project cost including financing charges is approximately ₹ 6900 Crore with a construction timeline of 5 years. All the statutory approvals are in place for construction work to start immediately.

This alliance between Tata Power and DGPC is an extension of the existing partnership in the 126 MW Dagachhu Hydropower Plant in Bhutan. Once operational, the Khorlochhu Hydropower Project will help Bhutan meet its winter electricity requirements which are increasing rapidly. It will also export electricity to India to support the increasing power demands of Indian utilities during the summer months.

This marquee investment underscores Tata Power’s commitment to its “Sustainable is Attainable” initiative, striving towards carbon neutrality and providing alternative clean energy to India.

The MoU for the project has already been signed between Tata Power and DGPC and the Definitive Agreement will be executed shortly.

Praveer Sinha, CEO & MD, Tata Power said, “This is a landmark alliance for Tata Power and Druk Green Power Corporation. The development of the 600 MW Khorlochhu Hydropower Project in Bhutan will provide energy security to the region. This project marks a significant step towards building a sustainable energy landscape underscoring Tata Power’s commitment to a greener future.”

Dasho Chhewang Rinzin, MD, DGPC, said, “This strategic partnership with Tata Power to develop the Khorlochhu hydropower project is a significant step towards Bhutan’s energy security and economic development as the country seeks to become a High Income GNH Economy by 2034. This partnership with Tata Power opens new avenues for sourcing investments to harness Bhutan’s huge hydropower and solar potential. It further ensures access to and complements the evolving Indian energy market for surplus generation in the summer months with opportunities to expand in future to the regional market. Looking forward, DGPC hopes to not only build on this partnership with Tata Power but also emulate similar partnerships with other interested partners.”

The Khorlochhu Hydro Power Ltd will also sign long-term Power Purchase Agreements (PPA) with Tata Power Trading Corporation Ltd, a wholly-owned subsidiary of Tata Power Company Ltd, for export of the summer surplus power to the Indian market and with Bhutan Power Corporation Ltd (a subsidiary of Druk Holding & Investments Ltd) for the domestic sale of power in the winter months.

Tata Power also has a successful Joint Venture with Power Grid Corporation of India Limited for a 1,200 km long Tala transmission line to bring electricity from Bhutan to Delhi.