ONGC Tripura Power Company

ONGC Tripura Power Company (OTPC) is a special purpose vehicle established to harness the natural gas reserves in Tripura, India, for power generation. It was formed through a Shareholders' Agreement on September 18, 2008, as a joint venture between Oil and Natural Gas Corporation (ONGC), Infrastructure Leasing & Financial Services Limited (IL&FS), and the Government of Tripura (GoT). The primary objective was to monetize ONGC's stranded gas reserves in the region, which were commercially undeveloped due to low industrial demand and logistical challenges.

The company's core asset is a 726.6 MW Combined Cycle Gas Turbine (CCGT) thermal power plant in Palatana, Tripura, which was constructed to supply electricity to the power-deficit north-eastern states. The plant consists of two 363.3 MW units; the first unit commenced commercial operations on January 4, 2014, and the second on March 24, 2015. This project represented the single largest investment in India's north-east region at the time.

OTPC's business model is anchored by long-term agreements. It has a 15-year Gas Sale and Purchase Agreement (GSPA) with ONGC, ensuring a stable fuel supply at a competitive, fixed-escalation price. The company sells approximately 94% of its generated power through 25-year Power Purchase Agreements (PPAs) with distribution companies in seven north-eastern states, based on a two-part tariff structure regulated by the Central Electricity Regulatory Commission (CERC). This structure allows for the recovery of fixed costs and a guaranteed return on equity, subject to meeting operational norms. The remaining power is sold on merchant exchanges. The company also exports power to Bangladesh.

Over the years, the shareholding structure has evolved. As of May 2024, ONGC holds a 50% stake, GAIL (India) Limited holds 26% (having acquired IL&FS's stake in January 2022), India Infrastructure Fund-II holds 23.5%, and the Government of Tripura holds the remaining 0.5%. OTPC has also ventured into developing power transmission infrastructure through its joint venture, North-East Transmission Company Limited (NETCL), which established a 650-km transmission line to evacuate power from the Palatana plant. More recently, OTPC has explored diversification into renewable energy, including hydropower projects in Meghalaya and a joint venture to develop a battery energy storage system in Assam.

Keywords: gas power generation, CCGT power plant, thermal power, ONGC joint venture, Palatana power plant, north-east India energy, power purchase agreement, gas sales agreement, electricity generation, Tripura, power transmission, energy infrastructure, combined cycle gas turbine, public-private partnership, clean power, battery energy storage