Gujarat clears new Tata Power deal to resume long‑term supply from Mundra plant

The deal comes as a relief to India, which is looking to maximise power output from its coal plants amid an escalating Iran war.

Gujarat has approved a revised power supply pact with Tata Power Co. Ltd., clearing the way for the company to resume long-term supply from its 4 GW Mundra plant, according to a government document seen by Reuters.

Tata Power's plant in Mundra, Gujarat, has not operated for the past six months.

The document did not have details on the exact pricing of the power supply but Gujarat has mandated that the price must not exceed that paid by other states, according to the document. The deal needs approval from the central power regulator and would take effect retrospectively from April 2025.

The deal comes as a relief to India, which is looking to maximise power output from its coal plants amid an escalating Iran war that is expected to lead to a gas shortage during summer. The imported coal-fired plant has not operated for the past six months after the government last ‌year ⁠withdrew the emergency clause that compensates for generating power using expensive imported coal.

Tata Power and the Gujarat government did not immediately respond to emails seeking comment.