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ReNew Power (ReNew), India’s largest renewable energy company, has announced that it has signed definitive agreements for the acquisition of an operating renewable portfolio of 527.9 MW. This includes 471.65 MW wind assets and 56.25 MW solar assets.
MSEDCL has also signed a PPA for ReNew’s 200-MW solar project. The Company’s total gross portfolio has increased by more than 25% to 12.8 GW, from 10.2 GW at the start of 2022.
The acquired 527.9 MW of operating wind and solar projects is spread across eight Indian states. The total enterprise value of these agreements is around ₹ 30 billion (US$ 388 million) and is expected to generate full-year FY23 EBITDA of about ₹ 3.95-4.24 billion (US$ 51-55 million). The expected closing of the overall transaction is in Q2 FY23, but ReNew will receive all cash flows generated from the assets from the lock box date, i.e., April 1, 2022.
The agreements have PPAs with state distribution companies in Gujarat, Maharashtra, Madhya Pradesh, Karnataka, Rajasthan, Telangana, Kerala, and Tamil Nadu, plus 25 MW of PPAs with corporate customers, and have an average remaining life of 17 years.
Renew will supply electricity for the MSEDCL PPA at Rs 2.43/kWh (~US 3.1 ¢/kWh) over 25 years. The asset will be located in Rajasthan state and supply electricity to Maharashtra. It is expected that the project will be completed by Q4 FY24.
Sumant Sinha (CEO, ReNew) spoke out about the sudden rise in Company’s portfolio. He stated that “The clean energy transition must occur at an increasing pace in India to meet–and Green–the growing energy needs of the country and strengthen its long-term energy security.”
Customers are more eager to sign new power contracts to secure future supply, given the recent blackouts and electricity shortages. Sumant said that ReNew will be the driving force behind this increase in clean energy, which will help India fight climate change.