A Pune-based multinational infrastructure company, Bharat Forge Limited, has invested ₹113.75 million (~$1.51 million) in Avaada SataraMH Private Limited (ASPL). The investment represents 8.98% of ASPL’s paid-up equity capital.

The investment enables Bharat Forge to purchase solar power under the group captive model. Avaada SataraMH is a special purpose vehicle (SPV) incorporated on December 2, 2019. It is engaged in developing projects through renewable energy sources such as wind, solar, biomass, hydro, and geothermal. It owns a 72.75 MW open access solar project spread across 528 acres of land in Varkute Village, located in Maharashtra’s Satara district.

Bharat Forge has invested in Avaada to get renewable energy, which will benefit the company from a cost-saving perspective.

According to India Ratings, Avaada has signed three 15 years power purchase agreements with Bharat Forge Limited, Kalyani Technoforge Limited and Praxair India Private limited and one 25-year PPA with Sudharshan Chemical Industries Limited. The minimum annual offtake through the agreement is 130.75 million units at an average fixed tariff of ₹3.73 ($0.051)/kWh.

The total estimated project cost of ₹4.1 billion (~$56.39 million) is financed by a debt of ₹2.7 billion (~$36.60 million) and equity of ₹1.4billion (~$19.79 million), including the share of captive consumers.

Last month, Bharti Airtel said it signed an agreement to acquire equity shares in Avaada MHBuldhana Private Limited, another special purpose vehicle for solar projects. The SPV was formed for owning and operating a captive solar power project in Maharashtra.

According to Mercom’s India Solar Project Tracker, Avaada Energy’s solar portfolio includes 635 MW of commissioned projects and 1.96 GW under various development stages.

In October, the Appellate Tribunal for Electricity, in reply to Avaada Energy’s petition, had approved grid-connectivity for a 100 MW solar project in Maharashtra. The project was earlier caught in disputes with the Solar Energy Corporation of India and Maharashtra State Electricity Distribution Company Limited.

Orient Cement, a subsidiary of Indian conglomerate CK Birla Group, announced that it would acquire a 26% stake in AMPSolar Systems Private Limited for ₹40.5 million (~$549,244) to set up a 13.5 MW solar project for captive power generation.

Industries with large power consumption are opting for solar to meet their renewable purchase obligation as well as reducing the cost of operations. Cost of purchasing solar has now turned attractive with tariffs falling consistently.