GUJARAT has approved a revised power supply agreement with Tata Power, allowing the company to resume long-term supply from its 4-gigawatt Mundra plant, according to a government document seen by Reuters.
The imported coal-fired plant has not operated for the past six months after the government last year withdrew the emergency clause that compensates companies for generating power using imported coal.
The agreement comes as India seeks to maximise power output from coal plants amid an escalating Middle East conflict, which is expected to lead to a gas shortage during summer.
The deal requires approval from the federal power regulator and would take effect retrospectively from April 2025.
The document did not provide details on the exact pricing of the power supply but stated that Gujarat has mandated that the price must not exceed that paid by other states.
Tata Power and the Gujarat government did not immediately respond to emails seeking comment.
The company’s shares were up 3.3 per cent in early trade at 411 rupees at 0400 GMT in Mumbai.
(With inputs from Reuters)
