The Government of Tamil Nadu is planning to set up a new underground hydel power station in Nilgiris district of the state.

The Tamil Nadu Government plans to set up the Sillahalla 2,000 MW underground power station in Nilgiris district. The project estimated to cost Rs 7,000 crore is expected to be completed in two phases by 2023. In phase I, the state government will construct 2.25 thousand million cu ft water storage reservoir on river Sillahalla. Also, a 2,750 mtrs tunnel will be established for this purpose. In phase II, 2,000 MW hydel power station will be set up using the 1,500 mtrs height between Sillahalla and Pillur reservoirs.

Surplus power from windmills and thermal and nuclear units at night will be utilised to draw water to the upper storage facility, which will be used to produce power during peak demand times.