Power Major Secures 40-Year Pumped Storage Contract with Rs 351 Crore Annual Fixed Charge
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Tata Power has received a 40-year contract from SECI to provide pumped storage services from a 324 MW facility, carrying a total annual fixed charge of Rs 351.3 crore and defined commissioning timelines.
✨ Key Takeaways
The Tata Power Company Limited has received a Letter of Award (LOA) from Solar Energy Corporation of India Limited (SECI) for providing pumped storage services from a 324 MW / 2,592 MWh Pumped Storage Plant (PSP), securing a long-term energy storage contract spanning four decades.
The LOA provides for energy storage services from the 324 MW / 2,592 MWh facility for a period of 40 years from the Scheduled Commencement of Supply Date. The contract carries an agreed fixed annual charge of Rs 1.0841826 crore per MW per year, along with an annual cycle loss of 24.61 per cent. For the full 324 MW capacity, the total annual fixed charge amounts to Rs 351.3 crore.
SECI, a Government of India enterprise, will enter into a Pumped Storage Purchase Agreement (PPA) with Tata Power subsequent to signing Pumped Storage Sale Agreements with the buying entities, establishing the contractual structure for long-term supply. The company is required to commence supply of storage capacity within 36 months of the effective date of the PPA.
The awarded project has been classified as a domestic contract and has been granted by a domestic entity. Tata Power clarified that the promoter, promoter group, or group companies have no interest in SECI in relation to the awarded contract and that the transaction does not fall within related party transactions.
The 324 MW / 2,592 MWh configuration defines both the power capacity and energy storage duration of the facility. The fixed annual charge structure linked to installed megawatt capacity provides a defined revenue framework over the 40-year tenure, subject to the agreed commercial terms, including the specified annual cycle loss.
The long-term tenure of the contract aligns the PSP as a contracted infrastructure asset within SECI’s procurement framework for energy storage services. The requirement to commission and commence supply within 36 months of the PPA’s effective date sets a clear execution timeline for the project.
The award was disclosed under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, with relevant information made available on the company’s website.
Pumped storage plants are designed to provide grid-balancing and energy storage services by shifting power across time periods, and the contract formalises Tata Power’s role in delivering such services under SECI’s framework. The agreed fixed annual charge per MW and the aggregate annual payment for 324 MW underscore the commercial structure underpinning the project.
The 40-year contracted period, combined with predetermined annual fixed charges and technical parameters, establishes long-duration operational visibility tied specifically to the 324 MW / 2,592 MWh asset.
The Tata Power Company Limited is an integrated power utility operating across Thermal & Hydro, Renewables, Transmission & Distribution, and other segments. It has a total capacity of 16,716 MW, including 16,229 MW in India and 487 MW internationally, with a diversified generation mix. Its Transmission & Distribution segment accounted for 60.1 per cent of segment revenue in FY2025-26, followed by Renewables at 21.8 per cent and Thermal & Hydro at 17.0 per cent, reflecting a broad presence across generation, networks, and clean-energy solutions.