Tata Power has formalised a major step in its cross-border clean energy strategy with the signing of commercial agreements for the 1,125 MW Dorjilung Hydroelectric Project in Bhutan. The agreement, signed with Druk Green Power Corporation Limited (DGPC), marks the launch of one of Bhutan’s largest hydropower developments and a significant public–private partnership in the region.
The project will be executed through a dedicated Special Purpose Vehicle, with DGPC holding a 60 percent equity stake and Tata Power owning the remaining 40 percent. Tata Power has committed an equity investment of about ₹1,572 crore, which will be infused in stages according to the agreed structure.
Located on the Kurichhu River in Bhutan’s Mongar district, the run-of-the-river project will comprise six generating units of 187.5 MW each. Designed with six-hour pondage to support peak-time supply, Dorjilung is positioned to enhance the reliability and flexibility of clean energy in the region. With a total estimated project cost of ₹13,100 crore, it will become Bhutan’s second-largest hydropower station and the country’s biggest PPP-based hydro project to date.
Upon commissioning, which is slated for September 2031, about 80 percent of the project’s output will be supplied to India. This cross-border supply arrangement is expected to strengthen regional energy security while supporting India’s renewable energy transition. The project also benefits from World Bank backing, underscoring its strategic importance in regional clean-energy development.
The agreements were signed in Thimphu in the presence of Bhutan’s Prime Minister, Lyonchhen Tshering Tobgay. The ceremony was attended by senior officials from Bhutan’s Ministry of Energy and Natural Resources, Druk Holding Investments, Tata Power, the Indian Embassy in Bhutan and representatives from the World Bank. Dr Praveer Sinha, CEO & Managing Director of Tata Power, executed the agreement alongside DGPC’s Managing Director, Dasho Chhewang Rinzin, and MoENR’s Director General, Karma P. Dorji.
Dorjilung builds on the decades-long cooperation between Tata Power and DGPC, which includes the operational Dagachhu Hydropower Project and the under-implementation 600 MW Khorlochhu project. Together, these initiatives support the shared ambition of developing 5,000 MW of clean energy capacity in Bhutan, aligned with the country’s national priorities and India’s long-term net-zero goals.
The project also comes at a time when Bhutan’s hydropower sector is gaining renewed momentum, following the commissioning of the 1,020 MW Punatsangchhu II project and the expected completion of the 1,200 MW Punatsangchhu I plant in the coming years. India’s recent announcement of a ₹40 billion concessional Line of Credit for Bhutan’s energy projects further underscores the strength of bilateral cooperation in sustainable infrastructure.
