India-based IT services company Tech Mahindra has entered into an agreement to acquire a 26% stake in Huoban Energy 6, a wholly-owned subsidiary of Fourth Partner Energy.

Huoban Energy 6 will commission a 5 MW captive open access solar project to power Tech Mahindra’s facilities in Pune, Maharashtra.

The project will add to Tech Mahindra’s efforts to increase the share of renewable power in its operation.

Incorporated on November 8, 2021, Huoban Energy 6 is a new company involved in renewable energy generation.

The 26% stake will be acquired for ₹16 million (~$205,676). The acquisition is expected to be completed within 90 days after signing the agreement.

Tech Mahindra said that while it has installed rooftop solar plants at all its facilities, it has also planned to procure renewable energy from captive projects. The company is a signatory to Business Ambition for 1.5°C that commits to containing the rise in global temperature by 1.5°C. It has adopted a climate action plan to become net-zero before 2040.

Group or captive renewable projects are deployed by a developer with a minimum equity contribution of 26% from consumers.

Large power consumers are increasingly procuring power from open access solar projects to reduce power costs and go green. Many industrial consumers opt for the group captive and captive model as their manufacturing units may not have sufficient roof space to install rooftop solar plants. Consumers also save on power expenses as the costs are much lower than grid power tariffs.

Tech Mahindra is part of the diversified Mahindra Group. Last July, the conglomerate signed a power purchase agreement with ReNew Sunlight Energy, a subsidiary of ReNew Green Energy Solutions, to procure solar power from its 43 MW open access project as a captive consumer in Maharashtra.

Another Mahindra Group company, Mahindra Susten, an engineering, procurement, and construction (EPC) firm, Mahindra Susten, was among the top utility-scale solar EPC service providers in the first half of 2021, according to Mercom’s India Solar Market Leaderboard 1H 2021. Mahindra Susten led the segment with a market share of 7%.