Stung By Rising Coal Prices, India’s Tata Power Plans Renewable Energy Acquisitions

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

Private sector power companies in India seem to have realised the business case behind the fuel cost advantage of renewable energy projects over conventional power projects and are now looking to expand their renewable energy portfolios.

The second-largest private sector power generating company in India, Tata Power, is planning to expand its renewable energy portfolio through its subsidiary Tata Power Renewable Energy Limited (TPREL). The company is planning to acquire wind energy projects from three generators, CEO Rahul Shah said recently.

The wind energy capacity in question is about 300 MW spread across southern India. The projects seem to be operational under long-term power purchase agreements at “competitive tariffs,” Shah added.

Tata Power had earlier announced that all new capacity to be added over the next two years would be based on renewable energy. It plans to commission or acquire about 800 MW capacity based on wind, solar, hydro, and waste-to-power technology. This skewed business plan seems a result of the legal battle the company is fighting over tariffs for one of its coal-based power plants.

Tata Power had commissioned India’s largest thermal power plant in Gujarat some time back. The tariff for the project was very low, determined through an auction conducted by the Indian government. The 4 GW Tata Mundra power plant is based on super critical coal technology with significantly lower emissions intensity compared to other coal-based power plants in the country.

The power plant, however, uses coal imported from Indonesia, as Indian coal has higher ash content and lower calorific value. Following restrictions placed by the Indonesian government on the export of coal, the cost of generation exceeded the tariff quoted by Tata Power. The company has filed a petition to increase the tariff and is facing stiff resistance from the state utilities over this issue.

Tata Power is looking to develop its renewable energy subsidiary into a full-fledged business by adapting to the changing power scenario in India. Renewable energy projects are finding favour over thermal power plants, which are struggling with debt and lack of adequate supply of coal and gas.

Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.

Our Latest EVObsession Video

I don't like paywalls. You don't like paywalls. Who likes paywalls? Here at CleanTechnica, we implemented a limited paywall for a while, but it always felt wrong — and it was always tough to decide what we should put behind there. In theory, your most exclusive and best content goes behind a paywall. But then fewer people read it!! So, we've decided to completely nix paywalls here at CleanTechnica. But...
Like other media companies, we need reader support! If you support us, please chip in a bit monthly to help our team write, edit, and publish 15 cleantech stories a day!
Thank you!

CleanTechnica uses affiliate links. See our policy here.

Mridul Chadha

Mridul currently works as Head-News & Data at Climate Connect Limited, a market research and analytics firm in the renewable energy and carbon markets domain. He earned his Master’s in Technology degree from The Energy & Resources Institute in Renewable Energy Engineering and Management. He also has a bachelor’s degree in Environmental Engineering. Mridul has a keen interest in renewable energy sector in India and emerging carbon markets like China and Australia.

Mridul Chadha has 425 posts and counting. See all posts by Mridul Chadha

5 thoughts on “Stung By Rising Coal Prices, India’s Tata Power Plans Renewable Energy Acquisitions

  • We like to read about India, and just now its change of course is big news. But – how to put this without causing offence – a little more breadth and balance would not come amiss. Things are also happening in Turkey, Brazil, Mexico, South Africa, and of course China and Japan. I could make the same point about over-generous coverage of Australia (which is admittedly fun because of the absurd politics) and even the USA. And Jinko borrowing some money from a bank isn’t really news at all.

    • That’s a fair point, James, but one could argue that India is the number one story in the world right now.

      The fable of the 300 million poor Indians without electricity is being promoted by coal producers everywhere. They’re trying to paint coal as a humanitarian gift to the poor.

      Against that nonsense, news about solar electricity uptake in India remains disproportionately important. Doubly so here in Australia, where governments at the state and commonwealth levels are hell-bent on wasting billions to expand coal operations. India is the only story they have to support this.

      • Fair enough. I’ve welcomed Cleantechnica’s good India coverage before now on exactly your grounds. Still, it’s also important whether China hits 8GW of new solar in the last quarter, as Bloomberg predicts.

      • A regularly-updated graphic summarizing the coal industry would be welcome. On one side you have producers (e.g. those wacky Australians but also apparently Indonesia as well as the US and others). Each of these countries have a history, a current cost of production, and an outlook for how the cost and quality of their coal output is going to evolve over time.
        And then you have coal consuming nations, each with an evolving regulatory environment and cost to install competing renewables.

        What has made India interesting is the rapid change in outlook, although the article hints that Indonesia might also be worth closer investigation. If I remember correctly, they’ve recently gone from being an oil exporter to oil importer, and they’ve got a huge and geographically dispersed population. Sounds like an ideal environment for distributed renewables!

  • So the ever increasing price of fossil fuels is finally sinking into the heads of electric power company executives. I’m sure the fossil fuel companies would like to own the sun and wind resources but they can’t. Stable priced renewable energy is here to stay and will now start the decline and fall of fossil fools

Comments are closed.