POWERGRID capex: ₹9.16 lakh cr grid push to 2032

Why transmission is back in focus

India’s clean energy transition is entering a grid-heavy phase, not just a generation buildout. A Kotak Neo report flags a government-committed transmission capital expenditure (capex) pipeline running into FY32, calling it a multi-year infrastructure cycle. The logic is straightforward: adding solar and wind capacity does not translate into usable power unless the transmission network can evacuate and move electricity across regions. This shifts attention to wires, transformers, substations, and high-voltage corridors that connect new projects to demand centres.

The report ties this to the next decade’s scale of renewables. India’s installed renewable energy capacity was 226 GW as of June 2025, up from 76 GW in 2014. Over the next decade, India is expected to add another 470 GW of solar and wind capacity, increasing the need for new transmission assets and faster project execution.

The size of the national transmission capex plan

As per the National Electricity Plan (NEP), transmission systems worth ₹9,16,000 crore are to be added till 2032. The split in the plan highlights how both inter-state and in-state networks are expected to expand.

Inter-state transmission investment is estimated at ₹6,60,000 crore, while intrastate transmission is estimated at ₹2,55,000 crore. Peak power demand is expected to touch 366 GW by 2032, according to the same NEP-linked details in the provided text. Separately, the 20th Electric Power Survey projections cited indicate peak demand could reach 296 GW by FY27 and 388 GW by FY32, underlining why grid strengthening is being positioned as critical infrastructure.

Renewables scale-up and demand growth are moving together

The Kotak Neo report frames transmission as the enabling layer for renewable expansion and rising consumption. Power demand is projected to grow at a CAGR of 6.4% till 2030. Alongside that, the renewable buildout continues to accelerate, with an additional 470 GW expected over the next decade.

The text also cites peak demand projections in the near term. Peak demand is projected to reach 277 GW in FY26 in one part of the material, and elsewhere demand expectations for the year are referenced around 270 GW. While the exact forecast varies by source within the supplied content, the common point is that peak load levels are rising and will need commensurate transmission and distribution capacity.

HVDC becomes a key enabler for long-distance evacuation

High-Voltage Direct Current (HVDC) systems are expected to play a bigger role as renewable projects move farther away from consumption centres. The Kotak Neo report expects India’s HVDC market to grow from USD 15 billion in 2025 to USD 31 billion by 2035.

Policy and project execution are also tilting towards HVDC, as such systems allow tighter control over power flows and can help grid operators manage variability from renewables. The provided text notes that HVDC lines are being encouraged by the government to support stabilisation as variable renewable energy integration increases.

POWERGRID’s capex ramp and project pipeline

Power Grid Corporation of India (PGCIL) sits at the centre of the transmission buildout described in the report and related updates. According to the Kotak Neo report, PGCIL’s actual capex in FY26 exceeded its revised target and reached ₹35,540 crore. Another section also states the company boosted its FY26 capex forecast to ₹35,000 crore, and separately mentions an increase to ₹23,000 crore from ₹18,000 crore for a different financial year reference in the text.

On forward spending, the Kotak Neo report says PGCIL has planned capex of ₹1,08,000 crore between FY26 and FY28, and an estimated business pipeline of ₹3,06,600 crore through FY32. Another update in the supplied content references a major transmission opportunity of approximately ₹7,90,000 crore, and also notes a broader potential pipeline of ₹15,00,000 crore across renewable evacuation, the Brahmaputra hydro corridor, and OSOWOG interconnections.

What’s driving orders beyond renewables

Beyond renewable evacuation, the report points to structural demand drivers that typically require strong networks and reliable power quality. Data centres, railway electrification, electric vehicles, and industrial expansion are all cited as drivers for transmission and distribution upgrades.

One section provides a specific indicator for data centres: India’s data centre capacity stood at 1.4 GW, with more than 5 GW of additional capacity expected to become operational by 2030. These loads can be concentrated in certain regions, pushing utilities and transmission operators to strengthen corridors, substations, and distribution networks to reduce congestion and improve resilience.

Market sizing: transmission capex and T&D revenue outlook

The Kotak Neo report pegs annual transmission capex at around USD 8 to 9 billion, and notes that large projects usually take three to five years to complete. That timeline matters for listed equipment manufacturers and EPC players, as it can provide multi-year order visibility once bidding and awards progress.

Another market sizing datapoint in the supplied text is the broader transmission and distribution revenue trend: USD 27.8 billion in 2024, projected to reach USD 37.6 billion by 2030, at a CAGR of 5.2%. While revenue projections are not a guarantee of sector profitability, the numbers signal steady expansion in network spending and services.

Execution risks that could shape outcomes

The report and related commentary list execution constraints that are common to large grid projects. These include execution delays, land acquisition challenges, right of way issues, forest clearances, raw material price volatility, and uncertainty around the timing of HVDC orders.

The dependence on long-duration project completion cycles also means schedule slippage can push out capitalization and cash flow recognition. For investors tracking the sector, the key is not just the headline capex number but the pace of tendering, award, and commissioning milestones over multiple years.

Key numbers at a glance

Market impact and what investors typically track

The supplied material positions transmission as a decade-long capex cycle rather than a one-time spike, which can affect how the market values grid-focused companies and their suppliers. A visible multi-year pipeline can support order books for equipment makers involved in transformers, switchgear, cables, and HVDC systems, provided tendering and execution keep pace.

For POWERGRID specifically, the market focus usually turns to capex-to-capitalization conversion, project awards under tariff-based competitive bidding (TBCB) versus regulated tariff mechanism (RTM), and how quickly new HVDC corridors move from planning to ordering. The text notes that a large portion of spending in one period was linked to TBCB projects, with a smaller share under RTM, reinforcing that bidding dynamics matter.

Closing takeaways

The numbers across the Kotak Neo report and the other cited updates point to a sustained transmission buildout linked to renewables, rising peak demand, and new load centres such as data centres and electrified transport. With ₹9,16,000 crore of transmission additions planned till 2032 and POWERGRID reporting ₹35,540 crore capex in FY26, the sector’s investment cycle is increasingly defined by execution speed and the timing of HVDC-led orders. The next set of signals to watch will be tendering momentum, project awards, and commissioning progress as the pipeline moves toward FY32.