The Assam Electricity Regulatory Commission has given in-principle approval to Assam Power Distribution Company Ltd (APDCL) to procure 500 MW of coal-based power under 25-year contracts, as the state looks to meet growing electricity demand.

The procurement will be implemented in phases — 200 MW starting FY26 and another 300 MW from FY29 — at a levelised tariff of Rs 5.79 per kWh, discovered through competitive bidding on the power ministry’s DEEP portal.

The decision comes amid Assam’s accelerating energy needs driven by rapid urbanisation, industrial expansion, and rural electrification. Officials said the new power agreements were guided by projections in the Central Electricity Authority’s Resource Adequacy Plan, which recommends fresh coal-based contracts until FY35 to ensure stable supply and meet renewable purchase obligations.

APDCL currently sources electricity from 36 entities, including central allocations, IPPs, and its own hydro plants. However, seasonal variation in hydropower output — due to erratic monsoons and drought-like conditions — has made grid reliability a challenge.

“This is a bridging measure to address short- to mid-term supply gaps,” an APDCL official said. “While we scale up renewables, we need firm coal-based supply to avoid disruptions.”

AERC has cleared the deal under Section 63 of the Electricity Act, 2003, and will monitor performance, environmental compliance, and tariff revisions. Officials also confirmed that the procurement is part of a broader transition plan that includes hybrid renewable projects and large-scale battery storage.

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