New Delhi: GAIL (India) Limited and Rajasthan Rajya Vidyut Utpadan Nigam Limited (RVUNL) have entered into a strategic joint venture agreement to bundle existing gas-based power assets with renewable energy (RE) projects in Rajasthan. The partnership aims to create a hybrid power generation model combining 600 MW of gas-based capacity with 1,000 MW of clean energy.
Details of the Joint Venture Agreement
The joint venture agreement, signed on July 29, 2025, will see RVUNL’s two gas power plants – the 330 MW plant at Dholpur and the 270.5 MW plant at Ramgarh – transferred to a newly formed Joint Venture Company (JVC), subject to successful due diligence by GAIL. The JVC will also develop around 750 MW of solar power and 250 MW of wind energy capacity in Rajasthan, complementing the gas-based generation to provide a reliable, flexible power supply.
Both GAIL and RVUNL will hold equal stakes of 50 percent each in the JVC.
Hybrid Model for Flexible and Cleaner Energy Supply
The integration of gas-based power with renewable energy aims to offer a more dispatchable and stable power mix that supports India’s energy transition goals. This hybrid model enables better grid management by balancing intermittent renewable generation with the steady output of gas power plants, ensuring firm capacity and grid stability.
Structure and Governance of the Joint Venture
Following due diligence, RVUNL will create a wholly owned subsidiary to become the JVC post-GAIL’s investment. The JVC will have an initial authorised and paid-up capital of Rs 10 lakh. The board will consist of six directors, equally nominated by both partners. Key provisions include:
- Right of first refusal on equity transfers for both parties
- A five-year lock-in period on shareholding from incorporation
- The agreement is confirmed as not being a related party transaction with no conflicts of interest
While the exact share pricing has not been disclosed, the JV formation marks a significant collaboration between a leading gas utility and a state power generation company focused on renewable energy.
Strategic Importance and Future Outlook
This JV is a critical step towards supporting Rajasthan’s and India’s broader ambitions for cleaner, reliable energy while enhancing the flexibility and resilience of the power grid. The project is expected to accelerate renewable energy capacity addition and improve the overall sustainability of the power sector in the region.
