According to a Crisil report, private sector investments in thermal power are set to increase significantly, reaching Rs.77,000 crore by FY28.

This marks a major shift as private players are expected to contribute nearly one-third of the total projected thermal investments in India, signaling a resurgence in base-load energy infrastructure.

Key Points:

• Investments in India’s thermal power sector are projected to nearly double to ?2.3 lakh crore during FY26–FY28, up from ?1.1 lakh crore in the previous three fiscal years.
• The private sector is expected to contribute ?77,000 crore, which is approximately one-third of the total, up from just 7–8% in the previous phase.
• Crisil attributes this rise to increasing energy demand and long-term power purchase agreements (PPAs) signed by state utilities with private thermal generators.
• Most of the upcoming private thermal projects are brownfield expansions, which face fewer risks related to land acquisition and infrastructure development.
• Crisil estimates an internal rate of return (IRR) of about 15% for timely commissioned projects, though timely equipment delivery remains a key challenge.