NEW DELHI :
ReNew Power Ventures Pvt. Ltd has formed a joint venture with South Korea-based engineering, procurement, and construction (EPC) firm GS E&C to build a 300 megawatt solar power plant in Rajasthan, according to a joint statement released by the companies on Wednesday.
The alliance comes even as India’s clean energy sector faces several challenges, such as the Andhra Pradesh government’s decision to renege on contracts signed by the previous government and delayed payments by state utility boards, which has brought the working capital cycles of generators under stress. ReNew Power will have a 51% stake in the JV, while GS E&C will own the rest.
GS E&C’s entry into India’s renewable energy sector also comes at a time that ReNew Power is putting 300MW of solar assets on sale, Mint reported on 7 October.
“The project is part of the capacity auctioned by Solar Energy Corporation of India under its tranche IV auctions concluded earlier this year," the companies said.
The Andhra Pradesh government’s decision to relook contracts signed by the previous government has hit firms such as ReNew, Greenko, Adani Power, PTC India Ltd, SB Energy, Mytrah, and Hero Future Energies. To add to the woes, electricity distribution companies owe ₹67,237 crore at October end for power bought from generation companies.
Banks are also wary of lending to renewable energy developers as they suspect the viability of projects, with solar and wind power tariffs being at a record low. Other problems include non-allocation of land to wind power projects and transmission and connectivity-related challenges.
Mint reported on 5 December that the Centre is considering a plan to offer state governments concessional loans from public sector lenders Power Finance Corp., Rural Electrification Corp. Ltd and Indian Renewable Energy Development Agency.