New Delhi: Tata Power will be investing Rs 60,000 crore over the next three years with almost half of it in the renewables sector, a top official said on Tuesday. The company, which is into power generation, transmission and distribution, will not be adding any new coal-based "thermal power capacity", its chief executive and managing director Praveer Sinha told reporters in Bhivpuri, Maharashtra.
It is investing up to Rs 15,000 crore in FY24, and will take it to up to Rs 20,000 crore in FY25, Rs 22,000 crore in FY26 and Rs 23,000 crore in FY27, to take the overall capex to Rs 60,000 crore by FY27.
In addition to two hydel pumped storage projects (PSP) of 2,800 MW, entailing an investment of Rs 13,000 crore announced earlier, the company has identified another three similar projects having the potential to generate up to 9,000 MW of power in the close vicinity, Sinha said.
Underlining that brownfield expansions like PSPs is better from the financial perspective, Sinha said it takes about Rs 5 crore of investment per megawatt for such expansions, where it leverages on existing assets to produce more power, and added that a greenfield hydel project will cost up to Rs 8 crore.
The three sites with the PSP potential include Potalpali, Kataldhara and Nenavali in the Raigad district, the company said. Interestingly, Sinha said that the company has not signed power-purchase agreements for two PSPs, including one here and another at nearby Shirwata, entailing an investment of Rs 13,000 crore and the destination for the 2,800 mw of power to be generated is not yet clear.
He, however, hinted that bundling the project with solar and wind capacity will help it in raising finances.
Sinha said it plans to commission the 1,000 mw PSP here by end of 2027, and the one at Shirwata (1,800 mw) a little later after that.
Its chief financial officer Sanjeev Churiwala said the company's finances are comfortable with the net debt at Rs 35,328 crore as of end FY23, and added that it will be funding the investments with 70 percent debt and the rest as equity.
He also said that the company has a slew of non-core assets like stakes in some group companies and mines, and investments in countries like Zambia and Georgia which can be used for raising resources, if need be.
Sinha said the company is targeting to double its revenues and also profits in the next four years on the back of the new investments.
When asked about the future of its generating capacity in Trombay in Mumbai, Sinha said the government wants the company to continue utilising a 500 mw coal-fired plant even after the current deadline for shutting down the old plant ends in March 2024.
He said the government and the electricity regulator are in a dialogue on the issue and depending on the alternatives which they find for supplying power to the financial capital, they will be taking a call, which the company will be abiding by.
The Tata Power scrip closed 4.88 percent up at Rs 270.75 a piece on the BSE on Tuesday, as against gains of 0.31 per cent on the benchmark.