Sembcorp eyes buying renewable assets to grow India portfolio

“We have now constructed deeper capabilities that we’ve got exhibited by means of our mission executions which substantiate the declare that we generally is a higher proprietor of the belongings,” Tuli said.

Singapore-based Sembcorp Industries is eyeing the acquisition route to extend its renewable vitality base in India as the corporate goals to boost its inexperienced energy portfolio globally from the prevailing 3 gigawatt (GW) to 10 GW by 2025, Vipul Tuli, CEO South Asia of Sembcorp Industries, informed FE.

The corporate operates within the nation by means of Sembcorp Energy India (SEIL), which at present runs 4.8 GW of energy technology belongings within the nation entailing an funding of about Rs 35,000 crore, comprising 2.6 GW of thermal vegetation and the remaining capability consisting of renewable vitality tasks.

“Due to the capabilities and expertise in renewables we’ve got gathered, we now know that if we take over an asset we’re assured of producing extra electrical energy from the identical asset than the earlier proprietor,” Tuli stated.

With out specifying the precise renewables capability addition goal set for the nation, the CEO added that “we’re again on the expansion path, whether or not by means of acquisitions or bidding”. Nonetheless, Tuli specified that Sembcorp won’t purchase tasks the place tariffs have been found in auctions however energy buy agreements (PPAs) haven’t been signed.

A current report collectively launched by Ficci and Ernst & Younger (EY) pointed that renewable vitality tasks with round 20 GW of contracted capability from renewables auctions held in 2018, 2019 and the primary half of 2020 at present stay stranded with out PPAs. Sembcorp, in July 2020 had introduced the commissioning of the 800 MW of wind energy tasks it had gained auctions carried out by the Photo voltaic Vitality Company of India (SECI) 2017 and 2018. The corporate had largely stayed away from auctions in 2019 and a big half in 2020.

“We have now constructed deeper capabilities that we’ve got exhibited by means of our mission executions which substantiate the declare that we generally is a higher proprietor of the belongings,” Tuli said.

The common tariff found for the aforementioned stranded 20 GW tasks are 12% increased than these for which PPAs are executed, the Ficci-EY report famous. State-run discoms developed chilly ft on shopping for energy at specific tariffs found below auctions after a lot decrease costs found below subsequent rounds of bidding. The present lowest photo voltaic tariff is Rs 1.99/unit.

“Initiatives which found bids of round Rs 2.70 to Rs 2.90/unit had been trying to be costly, however with the rise in photo voltaic module costs and upcoming primary customs responsibility tariffs are set to rise and these tasks will begin to come throughout as low cost,” Tuli said.