The firm has signed a power purchase agreement with state-run Solar Energy Corporation of India
ReNew Power plans to invest $1.2 billion to supply round-the-clock 400 megawatt (MW), and has signed the long pending power purchase agreement (PPA) with state-run Solar Energy Corporation of India (Seci) for the same.
“ReNew had won the bid to supply Round-The-Clock power in 2020 through an auction conducted by SECI. As per the contract, ReNew Power will supply electricity in the first year at ₹2.90/kWh (about 3.9 cents). This tariff will increase by 3% annually for the first 15 years, after which it will stabilize for the remaining 10 years of the 25-year contract," ReNew Power said in a statement.
This electricity is to be supplied to New Delhi Municipal Corporation (NDMC), Daman and Diu and Dadra and Nagar Haveli and will require 900 MW of wind capacity, 400 MW of solar capacity along with a battery storage. This wind and solar capacity will be set up in Karnataka, Maharashtra, and Rajasthan.
“The project will be designed to operate at an 80% average annual plant load factor (PLF) and will have a minimum capacity utilization factor of 70% a month, despite being a renewable energy project," the statement said.
This comes against the backdrop of ReNew Power's impending merger with Nasdaq-listed special purpose acquisition company (SPAC) RMG Acquisition Corp. II (RMG II) at an enterprise value of about $8 billion. In a related development, the shareholders of RMG II will vote on the merger on 16 August. The new entity, ReNew Energy Global Plc, is to be listed on the Nasdaq under the ticker symbol ‘RNW’, at an equity value of $4.4 billion.
The $1.2 billion equity proceeds from the ReNew Power merger with RMG II includes a private investment in public equity (PIPE) deal of $855 million. The PIPE investors include BlackRock, BNP Paribas Energy Transition Fund, Chamath Palihapitiya, Sylebra Capital, TT International Asset Management Ltd, TT Environmental Solutions Fund and Zimmer Partners.
ReNew Power operates 6.24 gigawatt (GW) of solar and wind power, with a total capacity of about 10 GW as of 31 December last year. In 2018, it had acquired 1.1GW of wind and solar power assets from Ostro Energy—one of the biggest acquisitions in the Indian renewable energy space.
ReNew Power is among the earliest entrants in India’s green economy. ReNew Power’s existing shareholders include Goldman Sachs, Canada Pension Plan Investment Board, Japan’s JERA Co. Inc., Abu Dhabi Investment Authority, GEF SACEF India and chairman and Managing Director Sumant Sinha.
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