The Uttarakhand Cabinet has approved a 25-year power purchase agreement with Adani Power to supply 1,320 MW of thermal electricity at a fixed rate of ₹5.746 per unit. This deal aims to stabilize the state's energy supply by 2029-30, reducing reliance on seasonal hydropower. Investors will monitor the project’s execution timeline and required regulatory clearances from the state electricity commission.
The Uttarakhand government has authorized the state-run Uttarakhand Power Corporation Ltd (UPCL) to enter into a long-term power purchase agreement with Adani Power Limited. This contract involves the supply of 1,320 MW of electricity over a period of 25 years. The initiative is a strategic move by the state to secure reliable energy as it seeks to move away from its high dependence on hydropower.
Currently, Uttarakhand relies heavily on hydroelectric projects to meet its power needs. While renewable, hydropower generation is seasonal and often drops significantly during winter months. By tying up a large supply from a coal-based thermal plant, the state government aims to ensure a steady supply of baseload power that is available regardless of the season or weather conditions. This plant is being developed in Chhattisgarh and will utilize coal blocks that have already been allocated to the state of Uttarakhand.
The agreed financial terms feature a fixed tariff of ₹5.746 per unit. This fixed-rate model is intended to protect the state utility from the volatility of short-term power market prices over the next two and a half decades. According to the current project roadmap, the power inflow from this new capacity is projected to commence in the 2029-30 financial year.
From an investor and operational perspective, several factors remain important to track. First, the agreement is still subject to formal approval from the Uttarakhand Electricity Regulatory Commission (UERC). Any delays in this regulatory process or changes to the terms requested by the commission could affect the project’s timeline. Second, a 25-year commitment at a fixed price carries an inherent financial risk for the state. If the broader electricity market experiences a significant, long-term decline in power prices, the state remains locked into this contract rate.
Furthermore, the success of this agreement depends on the timely construction and commissioning of the thermal plant in Chhattisgarh. Large energy projects often face execution risks, such as delays in construction, supply chain issues, or changes in fuel availability. As the global energy sector shifts toward greener alternatives, coal-based projects also face a changing policy landscape, which can sometimes impact the long-term viability or financing of such assets. The next key updates that investors and stakeholders will watch for include the final signing of the contract, the issuance of the UERC approval, and regular progress reports on the plant’s construction phase.