CEAT, a multinational tyre manufacturing company, has engaged Tata Power to develop a 10 MW captive solar project at Tata Power’s Solapur site in Maharashtra. CEAT will procure electricity from the project to power its Bhandup manufacturing facility.
As per the captive generation rules for open access power projects, CEAT will own 26% of the solar project, and Tata Power will own the remaining 74%. The project is expected to generate around 21 MU of energy annually, which will power CEAT’s manufacturing facility in Bhandup. The project would also likely offset around 17.43 million kg of carbon dioxide annually.
Tata Power also created a special purpose vehicle (SPV) – TP Akkalkot Renewable Limited – for construction, operation, and maintenance of the captive solar project.
Ravinder Singh, Chief-Solar Rooftops Business, Tata Power, said, “We are glad to associate with CEAT Limited and announce our new SPV. Through TP Akkalkot, we aim to continue to build a robust renewables portfolio and expand our horizons in the captive power generation sector.”
According to Tata Power, it has an engineering, procurement, and construction (EPC) order book of over ₹87 billion (~$1.16 billion) and a capacity of around 2.8 GW for solar projects in the financial year 2021. The company also has a portfolio of over 5.4 GW of ground-mounted utility-scale solar projects and over 500 MW of rooftop and distributed power generation projects to date. In addition, it also has a manufacturing facility with a production capacity of 1.1 GW of modules and cells in Bengaluru.
“The tie-up with Tata Power signifies our continued commitment towards a shift to sustainable energy and underpins our commitment towards building a better future. This arrangement will not only reduce CEAT’s dependency on non-renewable energy but is also a significant milestone in the company’s goal towards carbon neutrality,” said Kumar Subbiah, Chief Financial Officer of CEAT.
Larger power consumers are increasingly moving towards procuring power from clean energy sources. For industrial consumers, captive solar projects make sense as most projects or manufacturing units have poor quality or small roofs, which may only allow them to meet 10-15% of their energy consumption, whereas renewable purchase obligations (RPO) for these companies are much higher and many have also signed up for RE100 initiative. Captive renewable energy projects also help consumers reduce the operational with an added benefit of having visibility on power costs for the long term.
Harsh is a staff reporter at Mercom India. Previously with Indian Express, he has covered general interest stories. He holds a Masters Degree in Journalism from Symbiosis Institute of Media and Communication, Pune.