New Delhi: Sovereign wealth funds GIC Holdings Pte Ltd and Abu Dhabi Investment Authority (ADIA) have agreed to invest $495 million in Greenko Energy Holdings in one of the largest funding rounds by an Indian clean energy producer.
The deal confers an enterprise value of around $6 billion on Greenko Group, in which the two sovereign funds have now invested a total of $1.55 billion.
Hyderabad-based Greenko will use the funds to build two power storage projects with total capacity of 2.4 gigawatts (1.2GW in Pinnapuram, Andhra Pradesh and 1.2GW in Saundatti, Karnataka), the company said in a statement on Tuesday. The projects will be commissioned by 2022 and will need an overall capital outlay of $2 billion.
With the newly elected Narendra Modi government articulating its vision for reliable and uninterrupted power supply to households in its second term, Greenko’s focus on building integrated renewable energy assets with storage will help it provide clean energy during peak grid demand. Storage is key to providing on-demand electricity from wind and solar projects.
While GIC and ADIA hold 61% and 15%, respectively, in Greenko, founders Mahesh Kolli and Anil Kumar Chalamalasetty own the remaining 24%. Greenko has a total renewable energy operational capacity of 4.85GW, with 7GW under construction.
Last year, Greenko bought Orange Renewable from Singapore’s AT Capital Group at an enterprise value of $1 billion.
“Indian energy markets are transitioning from deficit markets to demand-driven contracts, requiring reliable, flexible and cost competitive energy. Greenko is focussing in building integrated renewable energy assets with storage to address these markets by competing with conventional energy assets in quality, quantity and cost," Chalamalasetty, chief executive and managing director, said in the statement.
Greenko has a total renewable energy operational capacity of 4.85GW, and is constructing 2.5GW of storage projects that can support 6GW of renewable generation capacity.