Thermal power investments to double to Rs. 2,30,000 crore (US$ 26.71 billion) in three years

India is projected to witness a significant boost in thermal power generation investments, expected to reach Rs. 2,30,000 crore (US$ 26.71 billion) by 2027–28, nearly doubling the amount from the previous three years. This surge is attributed to the growing energy demand and the need for stable base load capacity. According to Crisil Ratings, private sector involvement is anticipated to rise sharply, contributing around one-third of the total investments, up from a mere 7–8% in recent years. The government has laid out plans to add at least 80 gigawatts (GW) of thermal capacity by 2031–32, of which 60 GW has already been announced or is in various stages of execution, including 19 GW from private developers. These upcoming projects are largely brownfield expansions that generally present fewer execution challenges compared to greenfield developments.
Despite the encouraging investment outlook, certain operational challenges remain. A major concern is the timely delivery of key machinery components such as turbines and boilers, due to limited manufacturing capability and a large order backlog at core suppliers. However, Crisil notes that risks tied to fuel availability, electricity offtake, and tariff stability are relatively low. Most of the private projects are expected to become operational post-2028–29, factoring in the extended construction timelines involved. With central and state public sector undertakings contributing the majority of funding, the sector is poised for a robust expansion. The renewed investor interest, particularly from private entities, signals a strategic pivot in India’s energy landscape, balancing renewable ambitions with reliable thermal infrastructure for long-term energy security.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.