The Uttar Pradesh Electricity Regulatory Commission (UPERC) has approved a long-term power purchase arrangement under which Uttar Pradesh will receive 511 MW of hydropower from Bhutan for 30 years.
The agreement has been signed between Uttar Pradesh Power Corporation Limited (UPPCL) and the Khorlochhu Hydropower Project, a cross-border renewable energy project being developed in Bhutan.
Electricity Supply to Begin in 2030
Power supply under the agreement will start from May 1, 2030. Uttar Pradesh will receive electricity every year during the summer period from May to October, when power demand in the state is usually at its highest.
Fixed Tariff Offers Price Stability
A major highlight of the agreement is the fixed tariff of Rs 6.75 per unit for the entire 30-year duration.
The tariff has been approved without any annual escalation, providing long-term cost certainty for the state’s power sector.
UPERC noted that the project’s levelised tariff was estimated at Rs 6.47 per unit. After factoring in transmission expenses up to the India-Bhutan border, the final approved tariff was fixed at Rs 6.75 per unit.
Additional Power During Peak Hours
The project is expected to generate about 1,748 million units (MU) of electricity annually for Uttar Pradesh.
The hydropower station will have four-hour storage capability, enabling additional electricity generation during evening and peak-demand periods. This feature is expected to improve grid stability and support higher electricity consumption during the summer season.
Boost for Green Energy Targets
The commission said the power purchase will help Uttar Pradesh meet its Hydro Purchase Obligation (HPO), which mandates a certain share of electricity from hydropower sources.
The project will also increase the contribution of renewable energy in the state’s overall power mix and support its long-term sustainability objectives.
Transmission Responsibility Defined
Under the approved arrangement, Tata Power Trading Company will bear transmission costs, losses and operational expenses up to the India-Bhutan border.
Beyond the border, the responsibility for transmission charges and losses will rest with UPPCL. The approved tariff already includes the trading margin and settlement-related charges, ensuring transparency in power procurement costs.