NEW DELHI: The government has raised Power Grid Corporation of India Ltd’s (Powergrid) equity investment ceiling in each subsidiary from Rs 5,000 crore to Rs 7,500 crore, in a move designed to bolster funding for large transmission projects and renewable energy evacuation.The cabinet committee on economic affairs (CCEA), chaired by Prime Minister Narendra Modi, approved the higher threshold under existing Maharatna delegation guidelines, while retaining the overall cap of 15 per cent of the company’s net worth. Under department of public enterprises guidelines issued on 4 February 2010, Maharatna CPSEs such as Powergrid enjoy enhanced autonomy to make large investments without case-by-case government approvals.
Impact on Powergrid’s project pipeline
The higher limit expands Powergrid’s headroom to back capital-intensive transmission schemes, particularly ultra high voltage alternating current (UHVAC) and high voltage direct current (HVDC) corridors.These assets form the backbone of long-distance bulk power transfer, allowing the utility to scale up its role in strengthening the national grid and integrating geographically remote generation centres.
Renewable push and capacity evacuation
Government officials said the additional financial flexibility will help Powergrid step up investment in transmission systems dedicated to evacuating renewable power, a critical enabler for India’s goal of 500 GW of non-fossil capacity by 2030.Powergrid already handles the majority of inter-regional transfer capacity in the national grid and has facilitated the evacuation of over 110 GW of non-fossil energy, positioning it as a key player in the next leg of green capacity build-out.With a higher equity cap per subsidiary, Powergrid can more aggressively participate in tariff based competitive bidding (TBCB) for new transmission projects, including complex, high-ticket networks.The government expects deeper participation in TBCB to broaden competition, aid sharper price discovery, and, over time, translate into more affordable and cleaner power for industrial and retail consumers.
