State-run power transmission company Power Grid Corporation (PGCIL) has raised its capital expenditure (capex) for the current financial year to Rs 23,000 crore from Rs 18,000 crore, on the back of robust growth and higher demand, chairperson and managing director (CMD) RK Tyagi has said.
PGCIL has Rs 1.47 lakh crore worth of transmission work at hand. "For FY25, the capex is about Rs 23,000 crore. For FY26, it will be in the range of about Rs 28,000-30,000 crore. Further, for FY27, the capex will be Rs 35,000 crore," Tyagi said during an investor call after the Q3FY25 results.
Most of the capex - Rs 14,209 crore from FY25 allocation - is being spent on projects won through tariff-based competitive bidding (TBCB), while Rs 3,914 crore worth of projects were picked through the Regulated Tariff Mechanism (RTM), under which the government nominates PGCIL to execute a project.
Previously, the company had set a capex target of Rs 20,000 crore each for FY26 and FY27, which has now been raised by nearly Rs 10,000 crore. PGCIL said it is working extensively on both interstate and intrastate transmission projects - where the demand is going to be unprecedented - to evacuate renewable energy.
Among the major projects in its hands, PGCIL has two high voltage direct current (HVDC) projects - Khavda to Nagpur, which is almost worth Rs 35,000 crore; and Pang to Leh which is at least Rs 20,000 crore and will be executed in the next five years.
HVDC lines are being encouraged by the government now, as such systems offer precise control over power flow, allowing grid operators to manage and stabilise the grid more effectively, especially with the increasing integration of variable renewable energy sources.
The public sector undertaking (PSU) reported a 4 percent year-on-year (YoY) decline in net profit at Rs 3,862 crore for the third quarter that ended December 31, 2024. In the corresponding quarter last year, PGCIL posted a net profit of Rs 4,028 crore, the company said in a regulatory filing. However, the company's revenue from operations increased 3 percent to Rs 11,550 crore as against Rs 11,233 crore in the corresponding period of the preceding fiscal.
As per the National Electricity Plan (NEP), Rs 9.16, lakh crore worth of transmission systems is to be added till 2032. Within this, the investment needed on interstate transmission will be Rs 6.60 lakh crore, whereas for intrastate transmission, that will be Rs 2.55 lakh crore. This is driven by India's peak power demand which is expected to hit 366 GW by 2032. Besides, 500 GW of renewable energy is likely to be added by 2030, all of which will need transmission systems for evacuation of power.
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