NTPC Green Energy Limited (NGEL), a wholly owned subsidiary of NTPC Limited, India’s largest power producer, has entered into a joint venture agreement with Uttar Pradesh Rajya Vidyut Utpadan Nigam Limited (UPRVUNL), the state-owned power utility of Uttar Pradesh, to develop renewable power parks and projects in the state.
Joint venture agreement details
The joint venture agreement was signed by S K Dutta, Director (Projects & Commercial), UPRVUNL and V V Sivakumar, CGM, NGEL on March 4, 2024, in Lucknow, in the presence of P Guruprasad, IAS, Principal Secretary (Revenue), Government of Uttar Pradesh, Ranvir Prasad, IAS, MD, UPRVUNL, N S Rao, Regional Executive Director, NTPC and other senior officials from both the organizations.
The JVC will have an initial equity shareholding of 51% by NGEL and 49% by UPRVUNL. The JVC will have an authorized share capital of Rs 100 crore and a paid-up share capital of Rs 10 crore. The JVC will be registered under the Companies Act, 2013 and will have its registered office in Lucknow.
Renewable generation obligation fulfillment
The renewable energy (RE) power generated from the proposed joint venture company (JVC) will meet the Renewable Generation Obligation (RGO) of UPRVUNL, which is mandated by the Ministry of Power to procure a certain percentage of its power requirement from renewable sources.
According to the RGO regulations issued in 2022, thermal power plants commissioned after April 1, 2022 have to procure at least 10% of their power requirement from RE sources. For existing thermal power plants, the RGO is set at 5% for the year 2022-23 and will increase by 1% every year till it reaches 10% by 2027-28.
The JVC will help UPRVUNL to comply with the RGO regulations and reduce its dependence on fossil fuels. The JVC will also help UPRVUNL to lower its power purchase cost and improve its operational efficiency.
Green energy objectives achievement
The JVC will also help NTPC and NGEL to achieve their green energy objectives and support the Government of India’s efforts towards energy transition and climate action. NTPC has set a target of 60 GW of renewable energy capacity by 2032, out of which NGEL will contribute 10 GW.
NTPC is India’s largest power producer with an installed capacity of over 66 GW. NTPC has diversified its portfolio to include coal, gas, hydro, solar, wind and biomass. NTPC aims to become a net-zero carbon emitter by 2050.
NGEL is a wholly owned subsidiary of NTPC that was incorporated in 2020 to focus on RE development. NGEL has an operational RE capacity of over 1 GW and a pipeline of over 4 GW. NGEL is also exploring new avenues such as green hydrogen production, battery storage and electric vehicle charging infrastructure.
Renewable power parks and projects development
The JVC will leverage the expertise and resources of both NGEL and UPRVUNL to develop RE parks and projects in Uttar Pradesh, which has a potential of over 22 GW of solar power and over 1 GW of wind power. The JVC will also explore opportunities for hybrid projects, battery storage and green hydrogen production.
The JVC will identify suitable land parcels for setting up RE parks and projects in Uttar Pradesh. The JVC will also facilitate the procurement of land, clearances, approvals, permits and licenses required for RE development. The JVC will also arrange the financing, engineering, procurement, construction, operation and maintenance of the RE projects.
The JVC aims to develop at least 5 GW of RE capacity in Uttar Pradesh by 2030. The JVC will sell the RE power generated to UPRVUNL or any other entity as per the prevailing regulations and market conditions.
Socio-economic development boost
The JVC is expected to boost the socio-economic development of Uttar Pradesh by creating employment opportunities, enhancing infrastructure and promoting green energy. The JVC will also contribute to the national goal of achieving 450 GW of renewable energy capacity by 2030.
The JVC will generate direct and indirect employment for over 10,000 people during the construction and operation phases of the RE projects. The JVC will also provide skill development and training programs for the local workforce.
The JVC will improve the power availability and reliability in Uttar Pradesh, which is the most populous state in India with over 200 million people. The JVC will also reduce the carbon footprint and environmental impact of the power sector in Uttar Pradesh.
The JVC will support the Prime Minister’s vision of ‘One Sun One World One Grid’ and the International Solar Alliance’s mission of ‘Solarising the Sunbelt’. The JVC will also align with the United Nations’ Sustainable Development Goals and the Paris Agreement on climate change.
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