Adani Power Limited, one of India’s largest private sector power generation companies, has taken a major step forward by entering into a long-term Power Purchase Agreement (PPA) with the Uttar Pradesh Power Corporation Limited (UPPCL). The agreement involves supplying 1,600 megawatts (MW) of electricity to the state over a 25-year period, marking a significant milestone in India’s power infrastructure landscape.
Deal Overview
As per the announcement on May 6, 2025, the Uttar Pradesh Cabinet approved the power deal with Adani Power. The agreement has been signed at a fixed levelised tariff of ?5.38 per unit, which is considered competitive for long-term thermal power contracts in the current environment.
Out of the 1,600 MW agreed:
1,500 MW will be delivered to Uttar Pradesh as part of this deal.
Power will be generated from a new greenfield thermal power project being developed in the state.
The remaining 100 MW is likely to be utilized for balancing requirements and reserves.
Why This Deal Matters
This agreement is one of the largest PPAs signed in India in recent years and highlights three key trends:
Rising Power Demand in Uttar Pradesh
UP is India’s most populous state and has seen increasing demand for electricity due to rapid urbanization, industrialization, and rural electrification programs. The 1,600 MW supply will significantly boost the state’s base load capacity.
Private Sector Involvement in Power Supply
The deal demonstrates growing reliance on private players like Adani Power to bridge the gap between power generation and demand, especially when public utilities are under pressure.
Long-Term Tariff Stability
Fixing a 25-year tariff provides cost predictability for both the utility and end consumers. The Rs 5.38/unit rate is seen as reasonable when adjusted for inflation and future fuel price volatility.
Project and Execution Timeline
The thermal power plant that will support this deal is expected to be commissioned in 2026–27, with construction to begin shortly. Adani Power has not yet disclosed the exact location of the new plant, but it is likely to be situated in eastern Uttar Pradesh for proximity to coal logistics and grid connectivity.
The company has assured timely delivery through its proven execution track record, which includes mega plants in Gujarat, Maharashtra, and Chhattisgarh.
Adani Group’s Broader Energy Strategy
This agreement aligns with Adani Group’s broader strategy of:
Expanding its footprint in both thermal and renewable energy.
Building strong, stable cash flows via long-term PPAs.
Supporting state governments in achieving 24x7 electricity goals.
Adani Power currently operates over 13,600 MW of capacity and has been adding new projects across both thermal and solar segments. The company has also bid for new capacities under central and state-level tenders.
Conclusion
The 25-year power deal between Adani Power and Uttar Pradesh marks a significant step in ensuring reliable electricity for India’s largest state. It reinforces Adani Power’s position as a key player in India’s evolving energy landscape and highlights the importance of public-private partnerships in powering the nation’s growth.
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