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Government Reconsiders AUSC Coal Power Project Amid High Costs and Renewables Push

The Indian government is reassessing its plan to develop an advanced ultra-supercritical (AUSC) coal-based power project due to high upfront costs and limited cost-benefit justification. Despite AUSC’s promise of higher efficiency and lower emissions compared to subcritical coal plants, officials noted that the resulting power would be unaffordable without viability gap funding (VGF).

A proposal for Rs26,000 crore in VGF, mooted by the heavy industries ministry, has stalled as focus shifts toward nuclear and renewable energy, which can deliver similar environmental benefits without subsidies. Developed by BHEL, NTPC, and IGCAR, AUSC technology completed its R&D phase in December 2020, and a full-scale 800 MW plant was announced in the July 2024 Union Budget.

However, despite NTPC submitting a draft Public Investment Board note in March 2025, the project has not received final approvals. Officials suggest that the government sees greater long-term viability in accelerating nuclear and renewable energy expansion rather than subsidizing costly coal-based alternatives.