Coal India and DVC Ink Rs 21,000 Crore JV for 1600 MW Thermal Power Project

Coal India Limited (CIL), India's largest coal producer, and Damodar Valley Corporation (DVC) have formalized a 50:50 joint venture to build a 1600 MW thermal power project at the existing Chandrapura TPS site in Jharkhand. This brownfield expansion will include two 800 MW ultra supercritical units.

The project is estimated to cost Rs 21,000 crore, covering development, construction, and commissioning. Commercial operations are planned to commence by fiscal year 2031-32, aligning with projections of India's increasing energy requirements.

The JV aims to boost India's baseload power generation capacity. Leveraging DVC's existing infrastructure at Chandrapura is expected to ensure efficient resource utilization and faster project implementation. CIL's subsidiary, Central Coalfields Limited, will supply the necessary coal, contributing to competitive variable costs due to the project's location in a coalfield area. The companies are also exploring future thermal and renewable energy projects together.

Impact This significant investment in thermal power infrastructure is crucial for India's energy security and economic growth, providing reliable baseload power. It also strengthens the synergy between two major state-owned entities. Impact rating: 8/10.

Difficult terms: Brownfield expansion: This refers to the development or redevelopment of a property where there has been previous industrial or commercial activity. In this case, it means adding new power generation capacity to an existing power plant site. Ultra supercritical: This is a classification for thermal power plants that operate at extremely high pressures and temperatures, making them more efficient and environmentally friendly than older plants. Baseload generation: This is the minimum level of electricity demand on an electrical grid over a span of time. Baseload power plants are designed to run continuously at a steady output to meet this constant demand. Variable cost: These are costs that fluctuate in proportion to a company's production level or sales volume. For a power plant, variable costs include fuel (coal) and operational expenses that change based on how much electricity is generated.