Thursday, October 21, 2021
Home Business Sembcorp eyes buying renewable assets to grow India portfolio

Sembcorp eyes buying renewable assets to grow India portfolio


“We have built deeper capabilities that we have exhibited through our project executions which substantiate the claim that we can be a better owner of the assets,” Tuli stated.

Singapore-based Sembcorp Industries is eyeing the acquisition route to increase its renewable energy base in India as the company aims to raise its green power portfolio globally from the existing 3 gigawatt (GW) to 10 GW by 2025, Vipul Tuli, CEO South Asia of Sembcorp Industries, told FE.

The company operates in the country through Sembcorp Energy India (SEIL), which currently runs 4.8 GW of power generation assets in the country entailing an investment of about Rs 35,000 crore, comprising 2.6 GW of thermal plants and the remaining capacity consisting of renewable energy projects.

“Because of the capabilities and experience in renewables we have gathered, we now know that if we take over an asset we are confident of generating more electricity from the same asset than the previous owner,” Tuli said.

Without specifying the exact renewables capacity addition target set for the country, the CEO added that “we are back on the growth path, whether through acquisitions or bidding”. However, Tuli specified that Sembcorp will not acquire projects where tariffs have been discovered in auctions but power purchase agreements (PPAs) have not been signed.

A recent report jointly released by Ficci and Ernst & Young (EY) pointed that renewable energy projects with around 20 GW of contracted capacity from renewables auctions held in 2018, 2019 and the first half of 2020 currently remain stranded without PPAs. Sembcorp, in July 2020 had announced the commissioning of the 800 MW of wind power projects it had won auctions conducted by the Solar Energy Corporation of India (SECI) 2017 and 2018. The company had largely stayed away from auctions in 2019 and a large part in 2020.

“We have built deeper capabilities that we have exhibited through our project executions which substantiate the claim that we can be a better owner of the assets,” Tuli stated.

The average tariff discovered for the aforementioned stranded 20 GW projects are 12% higher than those for which PPAs are executed, the Ficci-EY report noted. State-run discoms developed cold feet on buying power at particular tariffs discovered under auctions after much lower prices discovered under subsequent rounds of bidding. The current lowest solar tariff is Rs 1.99/unit.

“Projects which discovered bids of around Rs 2.70 to Rs 2.90/unit were looking to be expensive, but with the rise in solar module prices and upcoming basic customs duty tariffs are set to rise and these projects will start to come across as cheap,” Tuli stated.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.





Source link

RELATED ARTICLES

India is close to turning the pandemic tide: Poonawalla

The country had administered 87.60 crore doses of SII’s Covishield Covid-19 vaccine till Wednesday.Adar Poonawalla, CEO of Serum Institute of India (SII), expects...

Amy Roloff Reveals Loss of Beloved Rescue Dog: “I’m Still So Sad”

Amy Roloff has shared some tragic news with her followers. Last month, just two days before one of the happiest days of her life,...

Josh Duggar Suffers ANOTHER Legal Setback as Judge Allows Video Evidence to Be Presented In Court

From the moment that Josh Duggar was arrested on child pornography charges back in April, the former reality star's guilt seemed obvious to...

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisment -

Most Popular

India is close to turning the pandemic tide: Poonawalla

The country had administered 87.60 crore doses of SII’s Covishield Covid-19 vaccine till Wednesday.Adar Poonawalla, CEO of Serum Institute of India (SII), expects...

Amy Roloff Reveals Loss of Beloved Rescue Dog: “I’m Still So Sad”

Amy Roloff has shared some tragic news with her followers. Last month, just two days before one of the happiest days of her life,...

Josh Duggar Suffers ANOTHER Legal Setback as Judge Allows Video Evidence to Be Presented In Court

From the moment that Josh Duggar was arrested on child pornography charges back in April, the former reality star's guilt seemed obvious to...

Danielle Staub Claims She Was Danielle STABBED by Teresa Giudice

Despite leaving the franchise years ago, Danielle Staub has had a lot to say about her time at Bravo. She's taken shots at Andy...

Recent Comments