Vedanta secures 500 MW PPA, marking key milestone in IPP growth.
Power supplied by Meenakshi Energy and Chhattisgarh Thermal Power Plant units.
Agreement enhances revenue visibility ahead of Vedanta Power’s proposed demerger.
Vedanta Limited has secured a 500 MW Power Purchase Agreement (PPA) from the Tamil Nadu Power Distribution Corporation Limited (TNPDCL). This move marks a significant milestone for the company’s Independent Power Producer (IPP) business and reinforces its position as a reliable contributor to India’s energy security.
The agreement covers the highest share awarded to Vedanta Power—500 MW—out of the total 1,580 MW tendered by TNPDCL. This outcome is considered a testament to the company's competitive edge and operational excellence within the power sector.
As per the Letters of Award (LOAs), the power will be supplied by two of Vedanta’s thermal business units Meenakshi Energy Limited (MEL) in Andhra Pradesh, which will supply 300 MW, and Vedanta Limited Chhattisgarh Thermal Power Plant (VLCTPP) will supply 200 MW.
The five-year contract is scheduled to run from February 1, 2026, to January 31, 2031. The power has been awarded at a tariff of approximately ₹5.38/kWh.
Commenting on the development in the news release, Rajinder Singh Ahuja, CEO – Power, Vedanta Limited, highlighted the critical role of thermal energy in ensuring stability, stating that "Reliable baseload power is vital to India’s energy security". Ahuja asserted that the win reflects Vedanta’s growing leadership in efficient and dependable power generation.
Furthermore, the PPAs are expected to enhance revenue visibility and financial strength, laying the groundwork for future growth as Vedanta moves toward the proposed demerger of its power portfolio under the Vedanta Power identity.
Thermal Expansion Plans Ahead
Citing the Central Electricity Authority, ET reported that India’s power demand is projected to grow 7–8% annually through 2030, driven by industrial expansion, urbanisation, increasing adoption of electric vehicles and renewable energy. The report further added that the government is focusing on ramping up both conventional and renewable energy sources. In addition to generation capacity, the CEA Chairperson said that India has a robust pipeline of transmission infrastructure, with plans to add 100 GW of transmission capacity over the coming years. This expansion is expected to cost between ₹5-6 lakh crore, underscoring the government’s commitment to bolstering the national grid’s resilience and efficiency.
In addition, Tamil Nadu has planned contracts for 6,486 MW from thermal power capacity till FY 2029-30. Further, the state is required to tie-up an additional 7,000 MW from thermal capacity till FY 2034-35, according to the Resource Adequacy Plan by Central Electricity Authority.
According to Union Ministry of Power, the planned 6,486 MW includes three thermal power projects by Tamil Nadu Power Generation Corporation Ltd (TNGCPL) under construction. This includes North Chennai Thermal Power Plant (Stage III) Project (1 x 800 MW), Udangudi Thermal Power Project Stage-I (2 x 660 MW) and Ennore SEZ Supercritical Thermal Power Project (2 x 660 MW).
However, the under construction thermal power projects of TNPGCL - Ennore Expansion TPS (1x660 MW) & Uppur STPP U1&2 (2 x 800 MW) are not included in 6486 MW planned capacity, the Ministry told Standing Linkage Committee (Long-Term) for Power Sector which decides on coal linkage for power sector.
