Dorjilung Hydropower Project

The Dorjilung Hydropower Project is indeed a significant development in Bhutan's energy sector, marking a shift towards more private-sector involvement and cross-border renewable energy diplomacy between India and Bhutan.

Key Updates and Facts:

1. Project Overview:

   • The Dorjilung Hydropower Project is a 1125 MW run-of-river scheme being developed in the Kurichhu River basin, located in Bhutan’s Lhuentse and Mongar districts. The project will utilize the river's flow to generate clean hydroelectric power for both Bhutan and India.

   • The dam will stand at 139.5 meters and will direct nearly 287 m³/s of water through a 15-kilometer headrace tunnel to an underground powerhouse housing six Francis turbines. The project is expected to generate approximately 4.5 TWh annually.

   Public-Private Partnership (PPP):

   • In November 2024, a Memorandum of Understanding (MoU) was signed between Druk Green Power Corporation (DGPC) and Tata Power for the joint development of the project under a PPP model. Under this partnership, DGPC will hold a 60% stake, while Tata Power will own 40%.

   • This partnership reflects India’s growing role in private sector-led cross-border energy cooperation in South Asia, showcasing a shift from purely state-to-state collaboration to more business-to-business (B2B) arrangements.

   Financial Details:

   • The total estimated cost of the Dorjilung project is approximately $1.7 billion.

   • The project is being financed by the World Bank, adding an international layer to the financing and signaling Bhutan’s commitment to leveraging global financial support for its energy projects.

   Timeline and Expectations:

   • The project is expected to be commissioned by early 2032, with the first phase of infrastructure development already underway, including the construction of access roads, bridges, and other foundational elements.

   Significance of Tata Power’s Involvement:

   • Tata Power’s participation in this project represents a key milestone in India-Bhutan energy diplomacy, particularly in the context of clean energy.

   • It also signifies the increasing role of the private sector in cross-border energy projects in South Asia. Tata Power’s extensive experience in renewable energy and hydropower development adds both technical expertise and financial strength to the project.

   Strategic and Diplomatic Impact:

   • Bhutan's approach to this project, especially through the PPP model, signals a strategic move to diversify its sources of investment and reduce over-dependence on state-level assistance from neighboring countries like India.

   • The project also reinforces regional cooperation by ensuring that India’s energy needs are met with sustainable energy while providing Bhutan with the financial and technical support it needs for economic growth and energy security.

   Energy for Both Nations:

   • While the primary aim of the Dorjilung project is to harness Bhutan's hydropower potential, it will also contribute to India's energy security, especially by supporting the growing demand for clean energy.