Adani Power Secures 2400 MW Bhagalpur Project in Bihar via Competitive Bidding

Adani Power Limited has emerged as the successful bidder for the 2400 MW Bhagalpur (Pirpainti) thermal power project in Bihar. The project was awarded following a competitive e-bidding process initiated by the Bihar government to meet the state's projected doubling of electricity demand to over 17,000 MW by 2034-35. Adani Power quoted the lowest electricity tariff (L1 bidder) at Rs 6.075 per kilowatt-hour (kWh), comprising a fixed charge of Rs 4.165 and a fuel charge of Rs 1.91 per unit. This tariff was deemed highly competitive by the state government, especially when compared to recent bids in Madhya Pradesh which showed higher fixed charges.

Other qualified bidders included Torrent Power, which offered power at Rs 6.145 per unit, Lalitput Power Generation Co Ltd at Rs 6.165, and JSW Energy at Rs 6.205 per unit. The e-bidding process was conducted transparently.

Adani Power's planned investment of around Rs 30,000 crore is anticipated to be a catalyst for industrial growth and employment generation in Bihar, a state historically challenged by low private investment and significant labor migration.

However, the award has triggered a political controversy. The Congress has accused the ruling party of a 'scam' and alleged that the Adani Group is receiving preferential treatment, with claims of purchasing power at an inflated price. Government sources, however, maintain that the discovered tariff is competitive and no special concessions were granted.

The project, originally conceived in 2012 and relaunched in 2024, aims to address Bihar's infrastructure deficit and its reliance on agriculture, with nearly half its workforce dependent on farming.

Impact: This development is significant for Adani Power's expansion plans and its role in India's energy sector. It also holds considerable promise for Bihar's economic development, potentially attracting further private investment and creating much-needed employment opportunities. The political commentary adds a layer of scrutiny to the project. The impact on the Indian power sector and investor sentiment towards companies involved is expected to be positive in the medium to long term. Rating: 8/10.

Difficult Terms: Tariff: The rate at which electricity is sold or purchased, typically expressed in currency per unit of energy (e.g., rupees per kilowatt-hour). kWh (Kilowatt-hour): A unit of energy equivalent to one kilowatt of power exerted for one hour. It is commonly used to measure electricity consumption. Lowest Bidder (L1): In a competitive bidding process, the bidder who offers the lowest price or tariff. e-bidding: An electronic bidding process conducted online, designed to enhance transparency and efficiency. Power Purchase: The act of buying electricity from a power producer by a distribution company or state entity. Fixed Charge: A cost component in electricity tariffs that remains constant regardless of the amount of electricity consumed or generated, often covering capital costs and fixed operational expenses. Fuel Charge: A cost component in electricity tariffs that varies based on the price and consumption of fuel (like coal, gas) used to generate electricity. Power Generation: The process of creating electrical energy from other forms of energy. Power Transmission: The process of moving electricity from power generation plants to substations where it is converted to lower voltages for distribution. Capital Expenditure: Funds used by a company to acquire, upgrade, and maintain physical assets such as property, industrial buildings, or equipment.