Mumbai: Italy’s Enel Green Power (EGP) on Thursday said it has acquired a majority stake in Indian renewable energy company BLP Energy for about €30 million (about ₹ 220 crore), making it the latest multinational firm looking to benefit from India’s push to shift towards renewables.
EGP, a unit of Italy’s largest utility, said the acquisition opens doors to the huge potential in the Indian market and will be the gateway to further expansion across Asia. In recent months, US-based SunEdison and First Solar, Russia’s OAO Rosneft, China’s Trina Solar, Japan’s SoftBank and Taiwan’s Foxconn Technology have either invested or evaluated investing in the Indian renewables sector.
“We intend to contribute to the Indian government objective of increasing the share of renewables in the country’s energy portfolio. EGP is also interested in participating through BLP Energy in the country’s upcoming public solar tenders at both national and state level," said chief executive Francesco Venturini.
EGP has an installed capacity of more than 10,000 megawatts (MW) from a mix of sources, including wind, solar, hydropower, geothermal and biomass. The company has about 740 plants operating in 17 countries.
BLP Energy, the utility-scale wind and solar subsidiary of Bharat Light and Power Pvt. Ltd and a part of the BLP Group, builds, owns and operates utility-scale renewable energy power plants to generate clean energy through wind and solar technologies. The firm’s plants are in Gujarat and Maharashtra, with a total capacity of 172MW and total annual production of about 340 gigawatt-hours (GWh).
EGP had earlier announced that as part of its 2015-19 strategic plan, it would broaden its international footprint by expanding into new markets, including countries in the Asia-Pacific region. In India, the firm plans to work closely with the state and central governments.
“There is a significant increase that has happened in the activity because this (renewable energy) is one of the sectors that is seeing strong potential for growth... A lack of growth in their home market has compelling some of the global strategic investors to look at India to drive growth and their portfolio," said Sawan Kumar, executive director, UBS Investment Bank.
UBS Investment Bank acted as exclusive financial adviser to BLP Group on the transaction.
The central government is aiming to shift India’s energy mix towards renewables. It aims to install 100GW of solar power and 60GW of wind power by 2022, which may entail an investment of as much as $200 billion.
For India, the world’s biggest greenhouse gas emitter after the US and China, the emphasis on solar and wind power is also expected to strengthen its standing at global climate change negotiations culminating in a summit in Paris in December.
India’s solar power capacity today stands at 4GW, while wind power capacity stands at 23GW. EGP said in a statement that it has positioned itself to respond to this market opportunity and will bring in the latest renewable technology and global best practices in engineering design and project development.