Khorlochhu Hydro Power Limited (KHPL), a strategic joint venture between Bhutan’s Druk Green Power Corporation, which owns a 60% shareholding, and Tata Power, which owns a 40% shareholding, said on Monday that it has signed the ₹4,829 crore loan agreement with India’s NBFC Power Finance Corporation Ltd (PFC). The agreement also provides for a further standby credit facility of ₹950 crore.

KHPL is developing the 600-megawatt (MW) Khorlochhu Hydropower Project in Bhutan. The project, with an estimated cost of approximately ₹6,900 crore, including financing charges, is expected to be commissioned between 2029 and 2030.

This transaction marks PFC’s first cross-border financing in Bhutan, highlighting the growing clean energy cooperation between India and Bhutan. Under the agreement, PFC will be the sole lender to the project.

The Khorlochhu Hydropower Project in Trashiyangtse Dzongkhag is expected to generate 2,524 million units of electricity annually. The project will help meet Bhutan’s winter demand and enable the export of surplus power to India during the summer months.

Construction has already commenced, with civil contracts awarded and works underway since January 1, 2025. Power evacuation will involve a 145 km, 400 kV (kilovolt) double-circuit transmission line from the project to the Goling pooling station, which Bhutan Power Corporation Ltd will construct.

Tata Power, India’s largest vertically integrated power company, started 2026 on a high note when it reported a 6% year-on-year rise in profit after tax at ₹1,262 crore for the first quarter ended June 30, 2025, primarily due to growth across its renewables, rooftop solar, manufacturing (TP Solar), and T&D businesses. The company’s revenue rose 4% to ₹17,464 crore from ₹16,810 crore in the year-ago period, while Ebitda grew 17% to ₹3,930 crore in the first quarter.

Tata Power’s renewable energy portfolio continues to exceed expectations on innovation, scale, and efficiency across the clean energy value chain, says Praveer Sinha, CEO and MD, Tata Power. “Our Generation and T&D businesses are delivering impressive gains. Our Discoms are providing reliable electricity to about 13 million customers. Through its all-around performance, our Odisha Discoms have emerged as the national model of Discom reforms.”

Tata Power shares closed 1.17% higher on Monday at ₹388.30 apiece.