Power Grid Corporation of India Ltd (POWERGRID/PGCIL) has been issued a Letter of Intent (LoI) dated September 19, 2025, to act as the Transmission Service Provider (TSP) for the interstate transmission system (ISTS) project officially designated as “Augmentation of transformation capacity and implementation of line bays at Mandsaur substation for RE interconnection.” The project is a vital grid-reinforcement initiative situated in Madhya Pradesh, designed to address the 4.5 GW Renewable Energy (RE) application queue currently pending at the Mandsaur hub.
The Bidding Process and Competitive Landscape
The project was awarded under the Tariff Based Competitive Bidding (TBCB) modality, governed by Section 63 of the Electricity Act, 2003. This process, aimed at market-based price discovery for long-term transmission tariffs, was coordinated by PFC Consulting Ltd. PGCIL successfully outpaced a field of qualified contenders to secure the mandate.
The final qualified bidders included:
- KCC Buildcon Pvt Ltd
- Techno Electric & Engineering Company Ltd
- Power Grid Corporation of India Ltd (Successful Bidder)
Technical Project Scope and Infrastructure Requirements
The augmentation involves sophisticated engineering works at the Mandsaur Pooling Substation (PS) to mitigate potential thermal limit exceedances on the bus-bar and accommodate high-capacity injections. Key works include the installation of three Interconnecting Transformers (ICTs) and the creation of new bus sections.
| Infrastructure Element | Technical Capacity / Identification | Specific Requirement / Identifiers |
| 765/400 kV ICT (4th Unit) | 1×1500 MVA | Terminated on Sec-II; Main Bay No. 724 (765 kV) and Main/Tie Bays 432/431 (400 kV) |
| 400/220 kV ICTs (6th & 7th Units) | 2×500 MVA | 6th ICT: Bays 425/426 (400 kV); 7th ICT: Bay 430 (400 kV) |
| Bus Section-II Creation | 765 kV & 400 kV | 1-set of sectionalization bays for each voltage level to support Sirohi/Khandwa terminations |
| NTPC REL Solar Interconnection | 400 kV Line Bay | Dedicated bay for 900 MW project; Main/Tie Bays 444/443 (Sec-II) |
| 220 kV RE Interconnection Bays | 220 kV Line Bays | Support for Waaree (300 MW), JSP Green (350 MW), and TEQ Green Power XXII (250 MW) |
| New 220 kV Bus Section-III | Sectionalizer Arrangement | Includes 1-set sectionalization bay plus Bus Coupler (BC) and Transfer Bus Coupler (TBC) |
Strategic Importance and Renewable Energy Evacuation
This award solidifies PGCIL’s dominance in the Mandsaur regional energy hub. The project represents a synergistic layer of infrastructure: the Mandsaur PS is currently under development by Powergrid Mandsaur Transmission Ltd, while the critical downstream 765 kV Mandsaur–Khandwa D/C line is being executed by Powergrid Sirohi Khandwa Transmission Ltd.
By integrating these assets, PGCIL facilitates the evacuation of power from a massive 4.5 GW application pool, which includes the 900 MW NTPC Renewable Energy Limited (NTPC REL) solar project and the 600 MW Spring Energy project.
“The Government of India has set a target for establishing 500 GW non fossil generation capacity by 2030, out of which 2 GW REZ [Renewable Energy Zone] potential has been identified in Neemuch / Mandsaur area.”
Financial Overview and Execution Timeline
The project adheres to the National Committee on Transmission (NCT) capital expenditure benchmarks and strict Scheduled Commercial Operation Date (SCOD) requirements.
Fast Facts:
- Estimated Project Cost: Rs. 319 crore (as per NCT estimates).
- Implementation Timeline: 18 months from the date of the award.
- Operating Model: Build, Own, Operate, and Transfer (BOOT).
- Contract Performance Guarantee: Rs. 13.50 crore.
PGCIL’s Fiscal TBCB Performance
This win marks PGCIL’s fifth ISTS-TBCB success in the current fiscal year (FY26), bringing the company’s envisaged investment in such schemes to approximately Rs. 7,250 crore for the period. While PGCIL has received the LoIs for four of these projects, it is important to note that only Powergrid Mahan Rewa Transmission Ltd has completed the formal SPV acquisition stage. The other four projects remain in the pre-transfer phase:
- Robertsganj Power Transmission Ltd
- Davanagere Power Transmission Ltd
- Vindhyachal Varanasi Transmission Ltd
- Mandsaur I RE Transmission Ltd (The Subject Award)
- Powergrid Mahan Rewa Transmission Ltd (Acquired)
Regulatory Compliance and Disclosure
PGCIL has confirmed that this announcement and the associated project details were disclosed in strict accordance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The project will proceed toward formal SPV acquisition and the filing of a transmission license application with the Central Electricity Regulatory Commission (CERC).
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