Indian Oil Corporation Ltd. makes a corporate announcement

The disclosed project value is approximately Rs 755 Crores for the 100 MW turnkey wind project, equivalent to Rs 7.55 Crores per MW on a derived basis. Because the contract includes turbine supply, EPC, project execution and 10 years of post-commissioning O&M, Rs 755 Crores should be treated as the total contract value, not necessarily the capitalised cost of the wind assets alone. ^[1]

Alignment with FY25 green-energy plans

The FY25 investor handout did not provide a separate rupee-denominated “Green Energy” capex target, so the project’s value cannot be expressed as a percentage of an FY25 green-energy capex budget. Instead, the presentation disclosed capacity targets:

• Existing renewable-energy portfolio: 252.1 MW.
• Terra Clean renewable-energy development plan: 5.3 GW.
• Longer-term renewable-energy target: 31 GW by 2030. ^[2]

Against those capacity benchmarks, the 100 MW project represents:

Analyst read: Strategically, the order is consistent with IndianOil’s green-energy expansion, and it is material relative to the company’s FY25 renewable base. However, it is small against the stated multi-gigawatt ambitions. It also cannot be counted as FY25 capex or commissioned FY25 capacity: the order was announced on 3 September 2026, well after FY25 ended, and the announcement describes the contract but does not provide a commissioning date. ^[1]

The 100 MW wind project cannot currently be identified as a defined captive-power allocation for particular refineries. The 3 September 2026 announcement confirms a 100 MW turnkey wind project for IndianOil, including turbine supply, EPC and 10 years of O&M, but does not disclose the project location, refinery offtakers, captive-consumption share, or whether the power will be supplied through a PPA, open access or another structure ^[1].

IndianOil’s FY26 Annual Report separately refers to a planned 650 MW round-the-clock renewable-power requirement for refinery expansion projects ^[3]. It also says that IndianOil NTPC Green Energy Pvt. Ltd. was progressing 50 MW of renewable capacity to meet refinery-expansion power requirements ^[4]. However, the reported disclosures do not link this specific 100 MW order to that 650 MW programme or allocate it among Panipat, Gujarat, Barauni or any other refinery. Accordingly, there is no defensible percentage of the 100 MW that can yet be classified as captive refinery consumption.

Emissions contribution

The project is strategically relevant to IndianOil’s net-zero pathway, but its project-level emissions impact is not yet quantifiable:

• IndianOil’s stated objective is net-zero operational Scope 1 and Scope 2 emissions by 2046 ^[5].
• The FY26 BRSR reports Scope 1 emissions of 20.43 MtCO2e and Scope 2 emissions of 1.63 MtCO2e ^[6]. The Annual Report reports combined Scope 1 and 2 emissions of 22.06 MtCO2e for FY26 ^[4].
• The BRSR specifically recognises renewable-energy initiatives covering both captive consumption and grid-based power supply as contributing to the decarbonisation of operations ^[7].
• Under the BRSR methodology, Scope 1 covers direct emissions such as stationary and mobile combustion ^[6], while Scope 2 covers emissions associated with purchased electricity, calculated using the Central Electricity Authority grid factor and an operational-control boundary ^[6].

Implication: if the wind power is delivered to refinery loads and displaces grid electricity, its primary accounting benefit should be a reduction in Scope 2 emissions. It would reduce Scope 1 only indirectly if it also displaces fossil-fuel-based onsite generation or other direct combustion. Wind capacity by itself does not eliminate refinery-process emissions, fuel combustion or flaring.

The project was announced after FY26 year-end and therefore is not reflected in the FY26 BRSR emissions outcome. IndianOil reported that its existing 258.06 MW renewable portfolio generated 371.40 GWh and mitigated approximately 273.35 TMT of CO2e during FY26 ^[8]. No equivalent generation estimate, commissioning date, refinery allocation or CO2e-abatement estimate has been disclosed for the new 100 MW project. Its contribution should therefore be viewed as future Scope 2-abatement potential and transition infrastructure, rather than as a quantified reduction already embedded in the BRSR baseline.

The 100 MW order is material relative to IOC’s existing renewable base and will tilt the reported owned portfolio further toward wind, but it is not yet evidence of a quantified reduction in overall power procurement cost. The order is a secured project, not commissioned capacity, and the tariff, generation profile, financing structure and commissioning date are not disclosed.

Capacity mix bridge

If the 100 MW order is eventually added to the reported 258.06 MW portfolio, the resulting capacity would be 358.06 MW, comprising approximately 267.60 MW wind and 90.46 MW solar. The derived mix would therefore shift to 74.74% wind and 25.26% solar. This is a meaningful change in the core portfolio mix, although it does not imply that the project is already operational.

The order also represents approximately 15.38% of the 650 MW round-the-clock renewable power requirement being progressed for refinery expansion projects ^[3]. However, IOC has not stated that this specific 100 MW project is earmarked against that requirement.

Expected procurement-cost impact

The direction of impact is likely to be positive for procurement-cost stability, but the magnitude cannot be calculated from the disclosed information.

• Potential substitution of external power: Once commissioned and connected to IOC loads or an eligible contracted supply arrangement, the wind project could displace a portion of grid, market or other purchased electricity. That would reduce exposure to spot power-price volatility to the extent that wind generation is actually available when IOC needs power.
• Higher fixed or contracted cost component: The Rs 755 crore contract value ^[1] covers turnkey execution and long-term O&M; it is not an electricity tariff. If IOC owns the asset, the cost structure would include capital recovery, depreciation, financing and O&M. If the arrangement is structured through a PPA or another contracted model, the impact would instead appear primarily as a long-term contracted power cost.
• Wind does not provide firm replacement power on a one-for-one basis: The project’s actual contribution depends on its capacity utilisation, generation timing, transmission charges, open-access charges, balancing power and any storage or backup arrangement. These parameters are not reported. IOC’s separate focus on round-the-clock renewable power indicates that intermittent renewable capacity alone is not being treated as equivalent to firm refinery supply ^[3].
• Enterprise-wide impact should be smaller than the renewable-base impact: The project is large against IOC’s current renewable portfolio, but the company does not report the share of total electricity consumption or procurement cost represented by that portfolio. Therefore, it is not possible to quantify the reduction in consolidated power cost or to conclude that it will materially change IOC’s overall energy-cost base.

Net assessment: the order strengthens IOC’s renewable sourcing platform and increases wind exposure, but its near-term economic value is better viewed as procurement diversification and long-term price-risk management rather than a demonstrable reduction in total power cost. The key variables to monitor are commissioning, contracted tariff or captive-use structure, annual generation, transmission and balancing costs, and the extent to which wind output actually replaces higher-cost purchased power.