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Central public sector undertakings under the power ministry have planned capital expenditure of over INR 1 trillion for FY27, marking a rise of nearly 19 per cent from the revised estimates of the current year. The increase is led by Power Grid Corporation, NTPC and NHPC. The Union Budget has also raised allocation for distribution reforms under the RDSS, while maintaining steady support for other power-sector funds. The higher outlay reflects continued focus on grid expansion, generation capacity and financial improvement in distribution companies.
Public sector undertakings under the Ministry of Power have outlined capital expenditure plans exceeding INR 1 trillion for FY27, reflecting an increase of around 18.6 per cent compared to the revised estimates for the ongoing financial year. The investment plan covers nine central power PSUs and forms part of the broader infrastructure push outlined in the Union Budget presented recently. Advertisement
Power Grid Corporation of India is expected to account for the largest share of the proposed spending, with a sharp rise in its capital outlay compared to the current year. The increased allocation is linked to the expansion and strengthening of transmission networks to support rising electricity demand and integration of renewable energy. NTPC has also raised its planned investment, continuing its focus on new thermal and renewable capacity, along with ongoing projects. NHPC's higher allocation reflects sustained spending on hydroelectric projects and associated infrastructure.
Other power sector entities such as SJVN and Damodar Valley Corporation have also proposed higher capital expenditure for FY27. However, the planned spending by Tehri Hydro Development Corporation and Chenab Valley Power Projects is lower than their revised estimates for the current year, indicating selective moderation in project execution.
Alongside higher PSU investments, the Union Budget has increased the allocation for the Revamped Distribution Sector Scheme to INR 18,000 crore. The scheme remains central to efforts aimed at improving the financial and operational performance of power distribution companies, which have historically faced high losses and mounting debt. While distribution companies reported a profit after tax in the previous financial year, accumulated losses and borrowings remain elevated.
Allocations for other power-related heads, including the Power System Development Fund, have seen limited changes and remain broadly in line with current-year levels, indicating a targeted rather than broad-based increase in spending across the sector.
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