- AGEL has announced it has signed an agreement with SECI to build 8 GW of solar PV project and 2 GW of manufacturing capacity in India
- Projects will be set up in phases starting with 2 GW to come online by 2022 and remaining 6 GW in the form of 2 GW annually by 2025
- 2 GW solar cell and module manufacturing in Gujarat will all come online by 2022
- AGEL envisages to invest $6 billion to bring this capacity online creating 400,000 direct and indirect jobs in the process
Adani Green Energy Limited (AGEL) of the Adani Group has won a contract to build a whopping 8 GW of solar power project capacity in India and set up 2 GW of solar and module manufacturing capacity, all for a total investment of $6 billion leading to the creation of 400,000 direct and indirect jobs. Mercom India Research calls this win as ‘the largest in the world in a single bid’.
In a stock exchange filing, AGEL said this contract from the Solar Energy Corporation of India (SECI) is the first of its kind manufacturing linked solar agreement and takes the company’s under operation, under construction or under contract capacity to 15 GW. AGEL targets to have an installed renewable energy generation capacity of 25 GW by 2025.
Over the next 5 years, AGEL will build the 8 GW capacity in phases, starting with the first 2 GW coming online by 2022. The other 6 GW will be added in 2 GW annual installments through 2025. It did not specify the locations but said one of the projects will be a 2 GW single-sited generation project ‘that is tied for the rank of the largest single site project announced globally’.
The company will add 2 GW manufacturing capacity much earlier through the solar PV manufacturing arm of the Adani Group, Adani Solar (Mundra Solar PV Ltd) by 2022 increasing it from 1.3 GW currently.
“Adani Green Energy Limited’s business model of focusing on long-term contracts with investment grade counterparties, rapidly constructing large projects, and thereafter building solar development partnerships with major global integrated energy players that seek to reduce their carbon footprint has enabled it to expand rapidly since its public listing less than two years ago. This new contract will further help strengthen this model,” stated the company.
In February 2020, AGEL got France’s Total to invest $510 million to acquire a 50% stake in over 2 GW operational solar power generation capacity in India.
AGEL and Azure Power were the 2 companies that SECI selected for its 8 GW solar PV project capacity linked with 2 GW of manufacturing capacity tender awarding them both 500 MW of manufacturing capacity and 2 GW of project capacity. Both the winners had an option to increase both projects as well as manufacturing capacity under greenshoe option.
AGEL opted for the greenshoe option and offered to add an additional 1.5 GW manufacturing capacity taking the total to 2 GW and an additional 6 GW project capacity to take the total to 8 GW.
Azure exercised this greenshoe option as well to increase the capacity by an additional 500 MW and 2 GW for manufacturing and projects, respectively. Out of the 1 GW manufacturing capacity, Azure said it had tied up with Indian cell and module maker Waaree Energies for 500 MW (see Azure Power Wins SECI’s Manufacturing Linked Tender).
SECI’s original solar manufacturing linked project capacity tender underwent various changes, deadline extensions, modifications before finally securing winning bids from AGEL and Azure Power.