Gujarat Clears Revised Pact for Tata Power’s Mundra Plant Revival
Gujarat has approved a revised power supply agreement with Tata Power, paving the way for the resumption of long-term electricity generation from its 4-gigawatt Mundra plant, according to a government document reviewed by Reuters. The imported coal-based facility had remained idle for the past six months after the withdrawal of an emergency compensation clause that previously offset the high cost of imported coal.
The renewed agreement comes at a crucial time for India, which is seeking to maximise coal-based power output amid rising energy concerns linked to escalating tensions in the Middle East. The anticipated gas shortages during the summer months have further underscored the importance of restarting large-scale thermal power plants such as Mundra.
The revised pact, which still requires approval from the federal power regulator, is expected to take effect retrospectively from April 2025. While pricing details remain undisclosed, the Gujarat government has stipulated that tariffs must not exceed those paid by other states. Following the development, Tata Power’s shares rose 3.3% in early trading in Mumbai.
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