NMP 2.0 targets ₹2.76 trillion power asset monetisation by FY30

NMP 2.0 aims to monetise Rs 2.76 lakh crore worth of power sector assets by FY30 through hydro projects, transmission lines and PSU equity dilution, with Rs 49,900 crore targeted for FY26

The government is targeting asset monetisation of ₹2,76,500 crore from power sector projects by FY30, according to the National Monetization Pipeline (NMP) 2.0 released by Niti Aayog today. The target for FY26 has been kept at ₹49,900 crore. 

 

The asset classes in the power sector for NMP 2.0 include eight operational hydro assets of NHPC and SJVN, transmission assets of Power Grid (PGCIL), inter-state transmission lines (ISTL) and equity dilution of the step-down subsidiaries of PSUs.

 

The preferred mode of monetisation for hydro assets is the securitisation of future cash flows by the PSU. Meanwhile, PGCIL plans to monetise its transmission assets through securitisation of its respective annuity revenues.

 

ISTL projects are awarded on a Build-Own-Operate-Transfer (BOOT) mode through tariff-based competitive bidding. Investments made in these partnership projects shall be the monetisation value considered under NMP 2.0. The NMP 2.0 also involves partial equity divestment in the subsidiaries of power PSUs. Taken together, the total cash flow targeted by private investment from power projects by FY30 is ₹2,42,788 crore.

 

Asset monetisation is an alternative mode of financing which involves leveraging existing or under-utilised infrastructure assets to generate revenue and fresh investments, creating monetary inflow without additional fiscal pressure on the government. The additional capital that is unlocked through asset monetisation is reinvested in the creation of more assets.