Coal India on Monday said it has signed a memorandum of understanding with the Damodar Valley Corporation to set up a joint venture to operate a 1600 megawatt (MW) thermal power plant at Chandrapura in Jharkhand at an estimated investment of ₹16,500 crore.

DVC has two units, each 250 MW, operational at Chandrapura, marking this a brownfield expansion for the power utility.

Coal India (CIL), in a statement, said the joint venture would be on a 50 per cent equity-sharing basis. Coal for the proposed plant would be sourced from nearby mines of the public sector miners’ subsidiaries, Bharat Coking Coal and Central Coalfields.

CIL has been diversifying its presence beyond mining into energy generation, both in the thermal and renewable sectors. The coal major had earlier announced its plans to set up a thermal power capacity of two units of 800 MW each in the first phase through Mahanadi Basin Power Limited.

Last month, CIL had signed an MoU with Rajasthan Rajya Vidyut Utpadan Nigam for the exploration and execution of 4,100 MW capacity power projects. This includes a mix of coal-fired thermal plant, solar projects, pump storage plant and wind projects.

DVC, which operates thermal and hydel plants in Bengal and Jharkhand with a capacity of 6700 MW, had achieved its second-highest thermal power generation of 43370 million units in 2024-25 with a plant load factor of 75.7 per cent.

The power utility has ambitious plans to set up thermal power capacity of 1320 MW at Raghunathpur and 1600 MW at Koderma, and 800 MW at Durgapur, with pump storage projects being planned at Lugu Pahar (1500 MW) and Panchet hills (1000 MW).