The Tamil Nadu Generation and Distribution Corporation (TANGEDCO) plans to set up 20,000 MW of solar power projects with suitable battery storage, 3,000 MW of pumped storage hydro power project, and 2,000 MW of gas-based power plants in the next ten years. These projects may require a loan of Rs 1,325 billion.
The TANGEDCO has signed a memorandum of understanding (MoU) with the Indian Renewable Energy Development Agency (IREDA). The IREDA will provide technical assistance to the TANGEDCO for renewable energy project development, bid process management and implementation support within the terms of the MoU. Furthermore, the IREDA will also help the TANGEDCO raise financing by developing financial models, assistance in the understanding market instruments, underwriting services for the anticipated debt demands and conducting pre-market surveys, road shows to stimulate interest amongst prospective investors.
The focus on renewable energy is being strengthened since thermal plants will be decommissioned gradually by the end of their plant life of 25 years. In June 2020, the TANGEDCO had also planned to procure 500 MW of solar power from the Solar Energy Corporation of India and had received approval from the Tamil Nadu Regulatory Commission. The power would be purchased at Rs 2.78 per kWh for the next 25 years and will be used by the TANGEDCO to meet its renewable purchase requirements.