Adani Green inks 50:50 joint venture with energy major Total; French firm to invest $510 mn in 2GW solar projects

The transaction underlines the AGEL and Total’s commitment to address India’s growing demand for power in a sustainable manner and help meet India’s climate change goals, the statement said.

FP Staff February 07, 2020 11:37:25 IST
Adani Green inks 50:50 joint venture with energy major Total; French firm to invest $510 mn in 2GW solar projects
  • Total will own half of the JV company that will house the solar assets of Adani Green Energy's 2,148MW solar project portfolio across 11 states

  • The transaction, the second major proposed investment by the French energy major in a company controlled by Adani, comes amid a tough phase for India’s clean energy sector

  • The investment reinforces the immense potential in India's renewable energy sector, as well as Adani group commitment towards sustainable development, Adani said

In a major boost to India's clean energy drive, French energy major Total will acquire 50 percent stake in all operational renewable energy projects of Adani Green Energy Ltd (AGEL) for $510 million.

Accordingly, Total will own half of the joint venture company that will house the solar assets of Adani Green Energy's 2,148MW solar project portfolio across 11 states. Adani Green Energy will hold the remaining 50 percent in the joint venture, according to a filing to the BSE.

The transaction, the second major proposed investment by the French energy major in a company controlled by Adani, comes amid a tough phase for India’s clean energy sector.

Adani Green inks 5050 joint venture with energy major Total French firm to invest 510 mn in 2GW solar projects

File image of Gautam Adani, chairman Adani Group. Reuters.

The deal has been inked at a time when the country's green energy sector is passing through a tough time as the renewable energy industry is facing a tight lending environment, mounting dues from utilities and record low tariffs, said a report in Mint.

The reason for this scenario is said to be the low solar and wind power tariffs which in turn created concerns among banks to lend to green energy projects suspecting their viability, the report said.

"AGEL and Total Gas & Power Business Services SAS (Total) have entered into a binding arrangement for the investment of approximately $510 million for the acquisition of 50 percent stake and other instruments in a joint venture company (JVCo) which will house 2,148 MWac operating solar projects presently 100 percent owned by AGEL. The balance 50 percent stake in the JV Co shall be held by AGEL," the Adani Group firm said in a filing to the BSE.

The solar portfolio is spread across 11 states in India.

The transaction underlines the AGEL and Total’s commitment to address India’s growing demand for power in a sustainable manner and help meet India’s climate change goals, the statement said.

The transaction is subject to customary approvals and definitive agreements, it added.

Adani Group Chairman Gautam Adani said, "We are delighted to extend our long term partnership with Total to our renewable energy business in AGEL. The investment reinforces the immense potential in India's renewable energy sector, as well as Adani group commitment towards sustainable development. This is a pivotal step in our journey towards building the world's largest solar power company by 2025 and the world's largest renewable power company by 2030."

Total Chairman and Chief Executive Officer Patrick Pouyanne said, "This interest in over 2 GW of solar projects represents a real change of scale of our presence in India's renewable energy sector, which has very significant growth potential in the coming years. It will contribute to our ambition to deploy 25 GW of renewable energy by 2025."

Total is a major energy player that produces and markets fuels, natural gas, and low-carbon electricity and has 1,00,000 employees in more than 130 countries.

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