Independent power producer ReNew Power has signed definitive agreements to acquire over 500 MW of operating wind and solar assets.
ReNew said it would acquire operating wind assets totaling 471.65 MW and solar assets of 56.25 MW, taking the total capacity to 527.9 MW. The acquired assets are spread across eight states with a total enterprise value of around ₹30 billion (~$388 million).
The 527.9 MW solar and wind projects will likely yield full-year earnings before interest, tax, depreciation, and amortization (EBITDA) of about ₹3.95-4.24 billion (~$51-55 million). The transaction is scheduled for completion by the second quarter of 2023.
However, ReNew will receive all cash flows generated from the assets from the lock box date, i.e., April 1, 2022.
ReNew Power also signed a power purchase agreement (PPA) with the Maharashtra State Electricity Distribution Company Limited (MSEDCL) for a 200 MW solar project for 25 years. MSEDCL floated the tender to procure 500 MW of solar power from interstate or intrastate grid-connected solar projects through competitive bidding. ReNew was awarded 200 MW at ₹2.43/kWh (~$3.1/ kWh). The project is expected to be commissioned by Q4 FY24. The assets of the 200 MW project will be in Rajasthan, from where ReNew would provide electricity to Maharashtra.
With these agreements, ReNew’s gross renewable portfolio has grown by 25% to 12.8 GW from 10.2 GW during the first quarter of 2022.
Speaking on the growth in renewables portfolio, Chairman and CEO of ReNew Power, Sumant Sinha, said, “The clean energy transition in India must happen at an increasingly rapid pace to meet the expanding energy requirements and strengthen its longer-term energy security. Given the recent electricity shortages and blackouts, customers are keen to sign new power agreements to ensure future supply. ReNew will be at the heart of this growth in clean energy that will support India’s crucial fight against climate change.”
In April this year, ReNew Power signed five PPAs totaling 2 GW with the Solar Energy Corporation of India (SECI), the Punjab State Power Corporation, and corporate buyers.
Earlier this year, ReNew Power awarded a contract to General Electric Solutions business to build two 400 kW substations in Karnataka.