In a significant development for the region’s energy landscape, Tata Power has entered into a strategic partnership with Druk Green Power Corporation Ltd (DGPC) of Bhutan to develop the 600 MW Khorlochhu Hydropower Project. This project, located in the Trashiyangtse Dzongkhag (District) in Eastern Bhutan on the Kholongchhu River, is set to bolster Bhutan’s electricity supply and contribute to India’s transition to renewable energy.
The collaboration involves Tata Power making a 40 per cent equity investment in the public-private partnership company, Khorlochhu Hydro Power Ltd. The project, estimated to cost approximately Rs 6,900 crore, is expected to be completed within five years. All necessary statutory approvals are already in place, allowing construction to commence immediately.
This partnership builds on the existing successful collaboration between Tata Power and DGPC, following their work on the 126 MW Dagachhu Hydropower Plant in Bhutan. The Khorlochhu Hydropower Project is poised to address Bhutan’s growing winter electricity needs and will also export surplus electricity to India during the summer months, helping to meet the rising power demands of Indian utilities.
Dr Praveer Sinha, CEO & MD, Tata Power, highlighted the significance of this alliance, stating, “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, emphasised the strategic importance of the partnership, saying, “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 the 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.”
Khorlochhu Hydro Power Ltd will sign long-term Power Purchase Agreements (PPA) with Tata Power Trading Corporation Ltd, a wholly-owned subsidiary of Tata Power, for the export of surplus power to India during the summer. Additionally, agreements will be made with Bhutan Power Corporation Ltd, a subsidiary of Druk Holding & Investments Ltd, for domestic power sales during the winter months.
This investment underscores Tata Power’s commitment to its “Sustainable is Attainable” initiative, reflecting its dedication to achieving carbon neutrality and providing alternative clean energy sources to India. The Memorandum of Understanding (MoU) for the project has already been signed, and the Definitive Agreement is expected to be executed shortly.