PFC Sets Up SPV for ₹4,378 Crore Northern Region STATCOM Scheme as Renewable Pooling Stations Lose Grid Strength

Power Finance Corporation Limited (PFC) has informed the stock exchanges that its wholly owned subsidiary, PFC Consulting Limited (PFCCL), has incorporated Northern Region Power Transmission Limited as a special purpose vehicle (SPV) for the inter-state transmission scheme titled “Static/Dynamic compensation requirement in the Northern Region Grid”. Disclosed on 22 October 2026, the scheme has been estimated by the National Committee on Transmission (NCT) at ₹4,378 crore and will deploy eight Static Synchronous Compensators (STATCOMs) and three bus reactors at existing substations to strengthen voltage control and dynamic reactive support across the northern grid.

From NCT Approval to SPV

PFCCL was appointed Bid Process Coordinator (BPC) for the scheme at the 42nd meeting of the NCT, held on 7 July 2026, and the Central Electricity Authority (CEA) conveyed the decision through the meeting minutes dated 20 July 2026. The project will be awarded under the Tariff Based Competitive Bidding (TBCB) framework on a build, own, operate and transfer (BOOT) basis.

Under the Ministry of Power’s TBCB guidelines, the BPC forms a project SPV to carry out preparatory work such as surveys, project reports and initiation of land acquisition and forest clearance where required. The SPV is then transferred to the bidder selected as the Transmission Service Provider (TSP).

Bidding Timeline

PFCCL has issued a global e-bidding notice for the project. The key dates are:

• RfP documents available: from 22 October 2026
• Last date for seeking clarifications: 11 November 2026
• Bid submission deadline: 28 December 2026, 15:00 IST
• Bid opening: 28 December 2026, 15:30 IST

Bidding is being conducted on the MSTC e-commerce platform, and the RfP fee is ₹5 lakh (or USD 7,000) plus 18% GST. The NCT has set an implementation timeframe of 24 months for the scheme.

Scope of the Scheme

The scheme provides eight STATCOM units of ±300 MVAr each, a combined dynamic range of ±2,400 MVAr, supported by mechanically switched capacitors (MSC) and reactors (MSR) of 125 MVAr each. It also includes three bus reactors with a total rating of 580 MVAr.

All STATCOMs connect at the 400 kV level through dedicated bays. Owners of the Aligarh, Jhatikara, Mandola, Agra, Patran and Orai substations are required to give the implementing licensee free and unconditional access, while any additional land needed next to the existing Amargarh and Wagoora substations falls within the successful bidder’s scope.

Weak Grid Strength at Renewable Hubs

The scheme follows operational feedback from Grid Controller of India Limited (GRID-INDIA) on weak grid strength, or low short circuit ratio (SCR), in the western Rajasthan renewable energy complex and on over- and under-voltage conditions across the northern grid. Transmission lines are currently opened in real time as a short-term measure, but high-voltage issues have persisted. At the NCT meeting, GRID-INDIA stated that SCR in the Rajasthan and Gujarat renewable complexes is already on the lower side and, in future cases, below the threshold of 5 specified in CEA’s technical standards for grid connectivity. In its review of grid operations at the same meeting, it reported very low fault levels in 2029-30 study cases at pooling stations including Bhadla-III, Bikaner-II, Fatehgarh-IV, Khavda and Lakadia-II.

The Central Transmission Utility of India Limited’s (CTUIL) full proposal, estimated at ₹8,264.94 crore and agreed at the Northern Regional Power Committee meetings in April 2026, also included synchronous condensers (SynCons) at the Bhadla-III, Ramgarh and Fatehgarh-IV pooling stations. The NCT recommended only the STATCOMs and bus reactors, and its Chairperson asked CTUIL and GRID-INDIA to examine alternatives that provide synthetic inertia as compared with SynCons. GRID-INDIA also noted that grid-forming (GFM) inverters for battery energy storage systems (BESS) above 50 MW have been notified in CEA’s Construction Standards, 2026, and it was suggested that CEA issue an office memorandum mandating GFM inverters, with performance guidelines, in all new BESS above 50 MW.

Part of a Wider Grid-Strength Pipeline

The project joins a small group of inter-state schemes dedicated entirely to reactive power and system strength under TBCB. In November 2024, PFC transferred Khavda PS1 and 3 Transmission Limited, established for dynamic reactive compensation at the Khavda pooling stations in Gujarat, to the successful bidder. In 2026, PFCCL also ran the bidding for two SynCon units at the 765/400/220 kV Fatehgarh-II pooling station in Rajasthan and declared the final result in August 2026.

Outlook

With the SPV in place and bids due on 28 December 2026, the next milestones are bid evaluation and transfer of Northern Region Power Transmission Limited to the selected developer, after which the 24-month implementation period will begin. With more renewable capacity connecting at weak pooling stations, voltage support and system strength are becoming a regular part of transmission planning alongside new evacuation corridors.

Official Sources

1. Power Finance Corporation Ltd – Stock exchange intimation on incorporation of Northern Region Power Transmission Limited (22 October 2026), NSE corporate announcements: https://www.nseindia.com/get-quotes/equity?symbol=PFC
2. PFC Consulting Ltd – Notice Inviting Tender: Static/Dynamic compensation requirement in the Northern Region Grid: https://www.pfcclindia.com/download/261-nit-english.pdf
3. PFC Consulting Ltd – Request for Proposal: Static/Dynamic compensation requirement in the Northern Region Grid: https://www.pfcclindia.com/download/261-rfp-statcom.pdf
4. PFC Consulting Ltd – Bid Document for LiDAR Survey and Report, including scheme scope (24 July 2026): https://www.pfcclindia.com/download/final-bid-document-24-07-2026.pdf
5. Central Electricity Authority – Minutes of the 42nd Meeting of the National Committee on Transmission (held 7 July 2026, issued 20 July 2026): https://cea.nic.in/api/public/link-report/file?path=%2Fhome%2Fcea_website%2Freports%2Fgeneral%2Fen%2F42nd_NCT_MoM.pdf&mode=view
6. PFC Consulting Ltd – Tenders (Fatehgarh-II SynCon scheme and Northern Region STATCOM scheme): https://www.pfcclindia.com/tender.php?AM2
7. Power Finance Corporation Ltd – Intimation on transfer of Khavda PS1 and 3 Transmission Limited (NSE, 8 November 2024): https://nsearchives.nseindia.com/corporate/PFC_08112024170800_IntimationSIGNED08112024.pdf