2 min readNew DelhiFeb 24, 2026 07:37 PM IST
The Cabinet Committee on Economic Affairs Tuesday approved an enhancement in the permissible equity investment limit of POWERGRID, enabling the state-run transmission major to participate in capital-intensive projects critical for evacuating renewable energy (RE).
POWERGRID’s equity investment ceiling per subsidiary has been raised from Rs 5,000 crore to Rs 7,500 crore, capped at 15% of the company’s net worth. The move is expected to enable the company to bid for large transmission projects such as Ultra High Voltage Alternating Current (UHVAC) and High Voltage Direct Current (HVDC) networks, which require substantial upfront capital.
UHVAC and HVDC transmission systems are considered cost-effective for power transfer over long distances, with significantly lower transmission losses compared to conventional systems. These technologies are crucial for integrating large-scale renewable energy capacity located far from demand centres.
In a media briefing, Union Minister Ashwini Vaishnaw said the move would ensure greater participation by POWERGRID in bids that it was earlier unable to pursue. It would enable the company to contribute more towards strengthening the country’s power grid.
Companies are required to infuse equity equivalent to at least 20% of the total project cost while bidding for such projects. The enhanced investment limit is expected to allow POWERGRID and its subsidiaries to bid for projects with higher funding requirements.
“The approval will enable POWERGRID, the country’s largest and most experienced transmission service provider, to expand its investment in its core business and support the evacuation of RE capacity, helping achieve the target of 500 GW from non-fossil-based sources,” the government said in a statement.
The government added that the move would also deepen competition under the Tariff-Based Competitive Bidding (TBCB) framework for selecting developers of critical transmission projects.
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“This ensures better price discovery, and ultimately lead to the availability of affordable and clean energy for consumers,” it added.
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