Vector Green Energy, a wholly-owned subsidiary of IDFC Alternatives, has acquired 40 MW of grid-connected solar photovoltaic (PV) projects in the state of Madhya Pradesh.

Vector Green Energy is a portfolio company of India Infrastructure Fund II (IIF) and acts as an operating cum holding company for IIF II’s control investments in the renewable energy space. Vector Green is managed by IDFC Alternatives.

The projects acquired by Vector Green Energy are owned and operated by IL&FS Energy.

Aditya Aggarwal, the partner – infrastructure at IDFC Alternatives confirmed the acquisition to Mercom but declined to disclose the size of the deal.

“Over the past year, we have either contracted or acquired 375 MW of renewable energy projects. We acquired 25 MW from Jindal, 45 MW from Punj Lloyd, 223 MW from First Solar and now 40 MW from ILF&S,” Aggarwal said.

According to Mercom’s India Solar Project Tracker, the two projects have a capacity of 20 MW each and were developed under the National Solar Mission Phase-II Batch-I. Vikram Solar was the engineering procurement construction (EPC) contractor of the projects, which were commissioned in May 2015. ILF&S had entered a 25-year long power purchase agreement (PPA) at a tariff of ₹5.45 (~$0.08)/kWh  along with Viability Gap Funding (VGF) of ₹24 million (~$0.37 million)/MW under DCR category.

After the acquisition of this 40 MW solar, IDFC Alternatives, through Vector Green Energy, will also acquire another 200 MW of operating capacity from different owners by March 2018.

“The acquisition is in line with our growth plan and has both the hallmarks of IDFC’s strategy; cash flow and small project size. We prefer buying smaller portfolios as larger portfolio acquisition doesn’t provide sensible returns,” Aggarwal further added.

When asked about the upcoming plans of the company, Aggarwal said, “Diversification is the other most important thing. We have a presence in both solar and wind. We now want to expand into commercial rooftop solar. There are many reasonable projects that have attracted our attention.”

In January 2018, Mercom had reported that Vector Green Energy completed the refinancing of two solar projects with 223 MW of combined capacity in Telangana.

In August 2017, IDFC Alternatives had raised ₹2.5 billion (~$39 million) through the sale of non-convertible debentures. The funding was intended to refinance two solar projects in Punjab that IDFC Alternatives had acquired from Punj Lloyd and to repay debt.