REC Limited has handed over two major power transmission projects in Rajasthan and Himachal Pradesh to winning bidders. These infrastructure developments, valued at ₹3,321 crore, will be executed on a build-operate-transfer basis. Investors may note how these projects contribute to the firm’s advisory and project monitoring role in India’s power transmission sector.
REC Limited, through its subsidiary REC Power Development and Consultancy (RECPDCL), has completed the transfer of two major electricity transmission projects to selected developers. This transition marks the official handover of these initiatives to the companies responsible for building the necessary infrastructure to support India’s growing power demand.
Infrastructure Development in Rajasthan and Himachal Pradesh
The first project, managed by the special purpose vehicle Bhadla Ramgarh Power Transmission Ltd, involves upgrading major pooling stations in Rajasthan, including the Bhadla-III, Ramgarh, and Kanpur stations. Power Grid Corporation of India Limited has secured this project, which is estimated to cost ₹1,035 crore. The company is expected to complete this infrastructure enhancement by January 2029.
The second initiative, Shongtong Power Transmission Ltd, is located in Himachal Pradesh and focuses on building the 400/220 kV GIS Jhangi Pooling Station along with significant transmission line expansions, including a 175-kilometer connection between Panchkula and Wangtoo. This project has an estimated cost of ₹2,286 crore and was awarded to Terralight Solar Energy Tinwari Private Limited. The developer is required to finish the construction within a 30-month timeline.
Understanding the Project Model
These projects were awarded through the Tariff-Based Competitive Bidding process, which is a standard method used by the government to ensure cost-efficiency in infrastructure building. By utilizing a build-own-operate-transfer framework, these companies take on the responsibility of constructing and operating the assets for a set period before potentially transferring them back.
For REC Limited, these transfers reflect its active role in facilitating power sector infrastructure without taking on the direct construction risk itself. As a financial institution, REC’s core business revolves around funding the power sector. By acting as an intermediary for project development, the company earns revenue through consultancy and advisory services related to the bidding and monitoring process.
Investors tracking REC may monitor the company’s success in continuing to act as a project facilitator, as this provides a steady stream of non-interest income. The progress of these projects remains subject to standard industry risks, including potential delays in land acquisition, regulatory clearances, and the ability of the developers to execute construction within their projected timelines. The financial performance of these developers and their ability to maintain operational efficiency will be the primary factors determining the success of these transmission corridors.