REGULATORY · MARKET STRUCTURE · INDIA
India raises Powergrid’s per-subsidiary equity investment delegation for transmission bids
Change
India’s Cabinet (CCEA) approved raising Powergrid’s permissible equity investment per subsidiary to Rs 7,500 crore from Rs 5,000 crore, while keeping the 15% of net worth cap, to enable participation in more capital-intensive transmission projects.
Why it matters
The CCEA decision increases Powergrid’s delegated per-subsidiary equity investment limit to Rs 7,500 crore, up from Rs 5,000 crore, under DPE delegation-of-powers guidelines for Maharatna CPSEs, with the overall cap of 15% of net worth unchanged. The immediate effect is a higher internal approval ceiling for equity commitments through subsidiaries, which affects how quickly and at what scale Powergrid can enter bids. The change is explicitly linked to enabling participation in capital-intensive transmission projects, including UHVAC and HVDC networks. It also broadens the bidder pool in TBCB processes for critical transmission assets, affecting price discovery and award outcomes. The decision supports grid capacity expansion needed for renewable energy evacuation toward India’s non-fossil capacity targets.
Implications
- • Higher per-subsidiary equity capacity for Powergrid in large transmission bids
- • Potentially faster bid participation due to higher delegated approval threshold
- • Increased competition in TBCB tenders for critical transmission projects
- • 15% net-worth cap remains a binding constraint on aggregate equity deployment
Who is affected
- • Powergrid (Power Grid Corporation of India) and its project subsidiaries
- • Developers bidding in TBCB transmission tenders (private and public)
- • Renewable energy generators dependent on new evacuation/transmission capacity
- • Electricity consumers exposed to transmission tariff outcomes via price discovery
Source
Read full article on Economic Times →
Topics
World & Politics Policy & Regulation Energy & Power Renewable Energy Grid & Utilities