Major contracts of coal-based power have been awarded to Adani Power Ltd. and Torrent Power Ltd. in Madhya Pradesh a value at 32500 crore rupees (estimated at 3.7 billion dollars), indicating that India still depends on fossil fuels to support its rising energy needs. The transactions signify the major investments in coal-fired power generation, despite the fact that the country is also driving high ambitions in renewable energy.
Torrent Power was awarded by MP Power Management Co. Ltd. on Saturday a 22,000-crore rupees contract to construct a 1,600 MW ultra-supercritical coal-fired power plant. Adani Power secured a 10,500 crore rupees contract to build an 800 MW power plant in the state, which uses coal as its power source. It is anticipated that both of these companies will sell power generated in these plants to the power distribution company of Madhya Pradesh at slightly above 5.8 per kWh. Torrent Power has characterised the undertaking as its biggest investment in the coal industry so far, with an estimated annual revenue of 6,500 crore.
The announcements highlight the dual-track energy policy of India to continue investing in coal and firmly pursue renewables. Prime Minister Narendra Modi has pushed investment in clean energy, with the country aiming at having 500 GW of renewable power by 2030. At the same time, the government has announced its intentions to build coal-fired power capacity nearly 88 GW of new coal generation is planned by early 2032, a 63 per cent increment over earlier estimates.
Although the investments were huge, the responses of the investors were subdued. On Friday, Adani Power and Torrent Power stocks dropped by 0.92 per cent and 1.55 per cent, respectively, at the BSE, where the yardstick index declined by an overall of 0.34 per cent to 79,809.65 points. Analysts observe that coal is still highly important to India’s energy security, but at the same time, there is a sense of caution in the market given the ongoing energy transformation in India and the changing prices in the world of energy.
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