Tata Power and DGPC sign commercial agreements for Dorjilung project

Tata Power and Druk Green Power Corporation have signed commercial agreements to implement the 1,125 MW Dorjilung hydropower project in Bhutan. The project will be developed through a new special-purpose vehicle in which DGPC will hold 60 per cent equity and Tata Power will hold 40 per cent. Tata Power plans to invest about Rs 1,572 crore in phases under the agreed structure.

Dorjilung is a run of the river project on the Kurichhu River in Mongar. It will include six units of 187.5 MW each and six hours of pondage for peaking. With a total project cost of Rs 13,100 crore, Dorjilung will be Bhutan’s second-largest hydropower project and the largest public-private partnership hydro development in the country. It is scheduled for commissioning in September 2031. Once operational, 80 per cent of its electricity will be supplied to India. The World Bank is supporting the project.

The concession agreement was signed in Thimphu by Dr Praveer Sinha of Tata Power, Dasho Chhewang Rinzin of DGPC, and Karma P Dorji of the Ministry of Energy and Natural Resources. The event was attended by Bhutan’s Prime Minister Lyonchhen Tshering Tobgay, senior officials of MoENR and Druk Holding Investments, representatives of Tata Power, the Indian Embassy in Bhutan, and the World Bank.

Dorjilung adds to the long-running energy partnership between India and Bhutan. Tata Power already holds stakes in the Dagachhu project and the 600 MW Khorlochhu project. Both companies have committed to jointly develop 5,000 MW of clean energy capacity in Bhutan in line with Bhutan’s national goals and India’s net zero pathway.

The agreement also follows progress on other major hydropower developments in Bhutan. The 1,020 MW Punatsangchhu II project was recently commissioned. The 1,200 MW Punatsangchhu I project is expected to be completed within four years. India has also announced a concessional line of credit of Rs 40 billion for Bhutan’s energy sector.

DGPC said the Dorjilung project strengthens Bhutan’s position as a key source of clean power in the region and reflects its commitment to cross border partnerships. Tata Power said the project will expand its renewable portfolio and reinforce the Indo Bhutan energy corridor.