The Tata Power Company Ltd (Tata Power) has formalised Commercial Agreements with Druk Green Power Corporation Ltd (DGPC) for the development of the 1,125 MW Dorjilung Hydroelectric Project in Bhutan. The project will be executed through a Special Purpose Vehicle (SPV), with DGPC and Tata Power holding 60 per cent and 40 per cent equity shares, respectively.
The run-of-the-river project, featuring six units of 187.5 MW each, is being developed on the Kurichhu River in Mongar. Designed with six-hour pondage to support peak demand, Dorjilung is positioned as a pivotal undertaking in the expansion of clean and reliable hydropower in the region. Tata Power’s equity commitment for the project stands at approximately Rs 1,572 crore, to be infused in tranches under the agreed structure.
With an estimated project cost of Rs 13,100 crore, Dorjilung is set to become Bhutan’s second-largest hydropower development and the country’s largest Public–Private Partnership (PPP) hydro initiative. Upon commissioning, the SPV will be recognised as an associate company of Tata Power, further strengthening the company’s strategic footprint in the Himalayan renewable energy corridor.
Scheduled for commissioning in September 2031, the project will supply 80 per cent of its power generation to India, fortifying regional energy security and enhancing access to clean electricity. The initiative is supported by the World Bank, marking a significant milestone in cross-border clean-energy financing.
The Concession Agreement was signed in Thimphu by Dr Praveer Sinha, CEO & Managing Director, Tata Power; Dasho Chhewang Rinzin, Managing Director, DGPC; and Karma P. Dorji, Director General, Ministry of Energy and Natural Resources, Government of Bhutan, in the presence of senior dignitaries from Bhutan, the Indian Embassy, and the World Bank.
The collaboration builds on long-standing Indo-Bhutan energy cooperation, following earlier joint ventures such as the Dagachhu Hydro Power Project, where Tata Power holds a 26 per cent stake, and the ongoing 600 MW Khorlochhu Hydropower Project, in which Tata Power holds a 40 per cent stake. Together, these projects contribute to the broader goal of jointly developing 5,000 MW of clean energy capacity in Bhutan.
Dr Praveer Sinha, CEO & Managing Director, Tata Power, said:
“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. We thank the Governments of Bhutan and India, the World Bank, and DGPC for their support and trust. This partnership further strengthens our hydropower portfolio and positions the Indo–Bhutan energy corridor as a leading model for mutually beneficial, cross-border green energy cooperation.”
This development comes alongside recent progress in Bhutan’s hydropower sector, including the commissioning of the 1,020 MW Punatsangchhu II project and the expected completion of the 1,200 MW Punatsangchhu I project within the next four years. India’s announcement of a Rs 40 billion concessional Line of Credit for Bhutan’s energy projects further underscores growing bilateral support.
Dasho Chhewang Rinzin, Managing Director, DGPC, said:
“We are extremely happy to be moving ahead with the implementation of the Dorjilung project so soon after the Khorlochhu project in partnership with Tata Power. Bhutan’s huge hydropower potential positions it at the heart of South Asia’s clean energy future. Our strategic partnership with Tata Power on the Dorjilung project reflects Bhutan’s commitment to collaborative partnerships for regional progress. 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. We look forward to starting work on other projects, also with Tata Power and other partners.”
Once operational, the Dorjilung project will significantly augment Tata Power’s renewable energy portfolio while advancing Bhutan’s national development priorities. The partnership continues to be anchored in shared values, mutual trust, and a unified vision for sustainable regional growth.