Adani Seeks a New Lifeline for the Troubled East India Power Plant

10 Dec 2024

Adani Power Ltd is seeking new concessions from New Delhi for its $2 billion coal-fired plant in eastern India, which is facing challenges due to outstanding payments from Bangladesh, the sole buyer of its electricity.

In August, India's power ministry authorised Adani to sell electricity from the plant within India, but reports indicated that the plant's location in a designated Special Economic Zone (SEZ) was complicating domestic sales. It was noted that unless the trade ministry provides an exemption, the electricity generated would be treated as imported and subject to taxes.

The report stated that, as part of the request, the company is seeking to maintain exemptions on customs duties for imported coal used to operate its 1.6 GW facility. Without these concessions, it becomes effectively impossible to sell power to India's price-sensitive consumers, the report said.

As of the end of September, the Adani plant, which provides about 10% of Bangladesh's power consumption, owed $790 million. However, some payments have begun to be received from Bangladesh, Adani executives told analysts in October.