In a strategic push to enhance thermal power generation in eastern India, Coal India Limited (CIL) has partnered with Damodar Valley Corporation (DVC) to build a 1,600 MW ultra-supercritical thermal power plant in Jharkhand. This major energy infrastructure project marks a significant step forward in India's pursuit of cleaner and more efficient thermal energy technologies, while also highlighting the continuing importance of coal-based power in India’s energy mix.

Project Highlights: Capacity, Cost, and Location

The proposed plant will consist of two units of 800 MW each, using ultra-supercritical technology, known for its better fuel efficiency and lower carbon emissions compared to conventional thermal plants. The total project investment is estimated at ₹16,500 crore.

The site of this brownfield project is the existing Chandrapura Thermal Power Station (CTPS), which currently houses a smaller facility with 2×250 MW units. The expansion aims to transform the station into a major power generation hub in Jharkhand.

Strategic Importance of the MoU

A non-binding Memorandum of Understanding (MoU) was signed on April 21, 2025, in Kolkata, signaling the formal initiation of this joint venture. The agreement is between two government-owned entities — CIL, the world’s largest coal producer, and DVC, a prominent public sector power utility serving West Bengal and Jharkhand.

This joint venture will operate on a 50:50 equity sharing basis, meaning both companies will hold equal ownership stakes and share operational responsibilities equally.

Fuel Source and Supply Chain Synergy

Coal for the new power station will be sourced from coalfields near the project site, specifically from the subsidiaries of CIL — Bharat Coking Coal Limited (BCCL) and Central Coalfields Limited (CCL). This proximity to coal resources will not only reduce logistical costs but also improve supply reliability, making the project cost-effective and operationally viable.

The use of domestic coal aligns with India’s larger goal of energy security and reducing dependency on imports for energy needs.

Ultra-Supercritical Technology and Environmental Focus

Ultra-supercritical technology allows higher thermal efficiency, which means less coal is required to produce the same amount of electricity. This directly results in lower carbon dioxide emissions per megawatt of electricity generated.

By adopting this technology, the Coal India-DVC project is expected to:

• Reduce specific fuel consumption

• Minimize greenhouse gas emissions

• Enhance the environmental sustainability of coal-based power generation

This project, though coal-based, fits into the broader clean energy transition framework due to its high-efficiency parameters.

Financial Performance of Coal India Limited

On the same day as the project announcement, Coal India also reported its Q3 financial results.

• Net profit stood at ₹8,491.2 crore, beating market expectations of ₹7,799 crore by a wide margin.

• However, this marks a 17.5% decline year-on-year compared to ₹10,291.7 crore in Q3 of the previous fiscal year.

• Revenue for the quarter came in at ₹35,779.8 crore, which slightly exceeded the estimated ₹35,558 crore but was down 1% YoY from ₹36,154 crore.

• EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) reached ₹12,317.2 crore, again surpassing the expected ₹10,098 crore, though it saw a 5% YoY decline from ₹12,970.7 crore.

Stock Market Response

Despite the drop in profit, investors reacted positively to the company's outperformance on estimates, as well as the long-term growth signal from the Jharkhand power project.

• Coal India shares closed at ₹400.55, up ₹1.80 or 0.45% on the Bombay Stock Exchange (BSE).

The share performance suggests market optimism about Coal India’s operational stability, cost efficiency, and diversified energy strategy.

Implications for India’s Power Sector

The announcement has far-reaching implications:

• Boosting regional energy supply: The Jharkhand region is expected to see enhanced power availability, supporting industrial development and rural electrification.

• Job creation and economic boost: The project is likely to generate direct and indirect employment during the construction and operational phases.

• Model for public-sector collaboration: The Coal India-DVC partnership reflects how state-owned enterprises can work together to achieve national infrastructure goals.

Broader Sectoral Context

India’s power demand is growing rapidly due to urbanisation, industrialisation, and economic growth. While the country is investing heavily in renewables, thermal power still accounts for over 50% of the total generation capacity.

By choosing ultra-supercritical technology, Coal India and DVC aim to modernise India’s thermal fleet, making it more compatible with current environmental and efficiency norms.

Conclusion

The ₹16,500 crore joint venture between Coal India and Damodar Valley Corporation to build a 1,600 MW thermal power plant in Jharkhand is a major milestone for India’s power sector. It represents a strategic blend of economic development, technological advancement, and environmental responsibility.

With the use of ultra-supercritical technology, efficient coal sourcing, and state-owned collaboration, this project is poised to become a benchmark for future power infrastructure development in the country.

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