Total may lead Adani plan to raise $1.5 bn for green power

TotalEnergies on Wednesday invested $300 million to create an equal joint venture, named Adani Green Energy Twenty Three Ltd. (REUTERS)
TotalEnergies on Wednesday invested $300 million to create an equal joint venture, named Adani Green Energy Twenty Three Ltd. (REUTERS)


  • MNC’s $300 mn investment in JV with Adani Green settles doubts about its commitment


Adani Green Energy Ltd, which is planning to raise $1.5 billion, may secure a big chunk of it from French energy giant TotalEnergies SE, two people aware of the matter said. The Gautam Adani-led group’s renewables firm will use $750 million of this amount to repay bonds.

“Adani Green has got an approval to raise $1.5 billion this fiscal for capex and debt repayment. Of this, a major amount will come from TotalEnergies, which owns 20% in Adani Green," said the first person.

TotalEnergies on Wednesday invested $300 million to create an equal joint venture, named Adani Green Energy Twenty Three Ltd.

“Of the remaining $1.2 billion too, a major investment will come from Total. Of the total amount, around $750 million will be used to repay the 4.375% coupon dollar bonds maturing in September 2024. Rest of the amount will be used to ramp up renewable capacities. TotalEnergies has invested $2.8 billion in Adani Green, which is the largest investment in a single group in the renewables space in India by Total," said the first person.

The development settles doubts whether Total will continue to invest in Adani Group after allegations of fraud earlier this year, especially since Adani’s $50 billion green hydrogen project announced last year was envisaged with Total as the first major strategic partner. A Bloomberg report in August had said Adani may not tie up with TotalEnergies as of now for developing the green hydrogen project in India.

Total’s latest move comes almost seven months after the French firm decided to put all future investments in Adani firms on hold in February, following a 24 January report by US-based short-seller Hindenburg Research that accused the Adani Group of “pulling the largest con in corporate history".

“After our first joint venture AGEL23 in 2020 and our acquisition of shares in AGEL in 2021, this new joint venture with AGEL will enable us to speed up our development through direct access to a large portfolio of assets and to support the ambition of AGEL in becoming the Indian leader of renewable energy," said Patrick Pouyanné, chairman and CEO of TotalEnergies, who, in February had mentioned in an analyst call that “it makes no sense to add more (projects) until there is clarity. Adani has to explain the allegations (made by Hindenburg)".

Adani Green is aiming to set up a 45GW renewable energy capacity through solar, wind and hybrid energy production units by 2030, as a part of the group’s strategy to take on rivals such as Reliance Industries Ltd, Tata Group, Larsen & Toubro, Vedanta Resources, JSW Energy and Suzlon.

In Asia’s net-zero roadmap, India has taken centre stage with domestic corporate groups building large green energy capacities. India is the world’s third largest emitter of greenhouse gases after US and China, while Asia alone contributes over 50% to the planet’s all carbon emissions, worsening the global warming crisis.

“The investment will further strengthen the pivotal role played by AGEL in India’s glide path to decarbonization,"said Gautam Adani, Adani Group chairman.

The world’s rising green energy demand has not only thrown open a new business opportunity for companies but also serves the global aim to restrict temperature rise at 1.5 degrees Celsius by 2050, for which CO2 emissions must decline by 45% by 2030, reaching net zero by around 2050.

“TotalEnergies will reinforce its strategic alliance with AGEL and support the company in becoming the Indian leader of renewable energy, with a target of 45 GW renewable power capacity by 2030," said Adani Green in a statement.

At present, TotalEnergies SE holds a 19.75% stake in Adani Green.

Under the new joint venture, AGE23 will have a portfolio of 1,050 megawatts of alternating current (MWac), which will include a mix of already operational 300 MWac, under construction capacity of 500 MWac, and under development assets of 250 MWac, with a blend of both solar and wind power.


“TotalEnergies has been actively developing, notably through AGEL, its presence in the Indian renewable power market, a very interesting market by its size and growth and the early development of a merchant market," said Pouyanné of TotalEnergies.

To be sure, Total and Adani have been allies in green energy for quite a few years now.

In 2019, TotalEnergies shelled out $600 million for a stake in Adani Gas, known as Adani Total Gas now.

Between June 2020 and January 2021, the French energy firm invested $2.5 billion in Adani Green.

Last month, Qatar Investment Authority invested $474 million in Adani Green, while US-based boutique asset manager GQG Partners Llp has invested 7,038 crore in the renewables firm this fiscal so far. Total, too, has been raising ITS bet on Adani Group’s clean energy plans. The French energy firm had in 2022 picked up a 50% stake in the 5 mtpa LNG import terminal that the Adani Group is building at Dhamra in Odisha’s Bhadrak district.

Total owns 37.4% as a co-promoter in Adani Total Gas, which retails CNG to automobiles and piped natural gas to households.

Adani Green has ramped up capacity by 43% to 8,316 MW in the June quarter by adding 1,750MW of solar-wind hybrid capacity, 212 MW of solar capacity, and 554 MW wind power plants.

The company clocked a 70% rise in energy sales from a year ago to 6,023 million units on the back of capacity addition.

With a market capitalization of 1.58 trillion, Adani Green has increased capacity utilization factor for its solar energy business by 40 bps from a year ago to 26.9% in the April-June period.

As the country’s largest renewable energy firm, Adani Green has a total usable capacity of 20,000 MW.

The company has added a 2,676 MW renewable capacity to its operational fleet in FY2023 which includes a 325 MW wind power facility in Madhya Pradesh, a 212 MW solar power plant in Rajasthan, and the first-ever and largest 2,140 MW solar-wind hybrid power plant in Rajasthan.

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