EESL firms up £100 million investment plan to buy heat, power utility in UK
New Delhi: State-run Energy Efficiency Services Ltd (EESL) is firming up a £100 million investment plan for buying a combined heat and power utility in the UK, and investing in firms that are setting up fast-charging electric vehicle (EV) infrastructure and large battery storage in Canada.
This includes the $12 million investment announcement made on Wednesday, in the first utility scale energy storage facility by Leclanché and Deltro Energy to balance the Ontario power grid.
“EPAL, a joint venture between Indian state-owned Energy Efficiency Services Limited (EESL) and UK-based EnergyPro Limited (EP), is partnering with leading battery storage solutions provider Leclanché, starting with the investment of US $12 million in a previously announced and nearly completed advanced battery storage project in Ontario, Canada, known as Basin 1 and 21,” the firms said in a joint statement.
The acquisition plans stem from EESL’s strategy to equip itself for India’s changing energy economy, with it leading India’s EV procurement programme.
“As far as the international operations are concerned, I would say we have got much more traction in Europe than anywhere else,” Saurabh Kumar, managing director of EESL, said in an interview before the partnership announcement with Leclanché.
“The markets are mature and they understand energy efficiency much more than they do in Asia or South-East Asia, where it is just about starting,” Kumar added.
EESL has been operating in the UK’s £6.4 billion energy efficiency services market by acquiring two firms for £6.8 million through EPAL. In comparison, the energy-efficiency market in India is estimated at $22.81 billion. EESL has also started operations in South Asia and South-East Asia.
“Actually, we are almost close to investing around £100 million. Right now, it is £10 to 15 million (invested in the UK) but we are looking at acquisition of a £55 million company there,” Kumar said. “It is in combined heat and power, and district cooling.”
EESL secured $454 million in funding for energy-efficiency projects from Global Environment Facility, an international partnership of 183 countries, United Nations agencies, multilateral development banks, and international non-governmental organisations.
“One of the items is what is called district cooling and tri-generation... we are trying to acquire an entity which has expertise in combined heat and power. I can’t disclose it. Commercial due diligence is going on,” Kumar said.
District cooling is a concept wherein instead of having cooling everywhere, there is a provision for central cooling, post which it gets circulated.
The announcement on the UK’s heat and power utility’s acquisition is expected in a month’s time.
“We are also looking at other investments as well. A couple of investments in battery storage and charging infrastructure in Canada,” Kumar said in the interview.
EESL, promoted by public sector firms NTPC Ltd, Rural Electrification Corp. Ltd, Power Finance Corp. Ltd and Power Grid Corp. of India Ltd, is leading India’s energy efficiency programme seeking to reduce carbon emissions as part of its climate change goals.
“The other investment is in fast-charging infrastructure,” Kumar said.
India’s proposed EV programme would also help with grid balancing, besides complementing the government’s push for solar power, which is generated during the day and can be stored in EV batteries.
“Once 175 gigawatts of renewable energy is going to come into the grid, you will need lots and lots of grid stabilization,” Kumar said.
India, the biggest emitter of greenhouse gases after the US and China, plans to reduce its carbon footprint by 33-35% from its 2005 levels by 2030, as part of its commitments to the United Nations Framework Convention on Climate Change adopted by 195 countries in Paris in 2015.
“The reason why we are looking at these acquisitions and investments is that we want to stay ahead of the curve in India. Now, we have got into electric mobility. At some point in time, there will be a big charging infrastructure that will be laid out. If we have the best technology available with us, we will be ahead of the curve,” Kumar said.