Purvah Green Power, the renewable energy subsidiary of India's CESC, is embarking on a significant expansion by acquiring a 1.4 GWp operational solar portfolio from Renew Solar Power. This strategic move, valued at approximately $509 million, encompasses six special purpose vehicle projects located in Rajasthan and Karnataka. The acquisition is poised to substantially increase Purvah Green Power's operational scale, integrating projects with proven performance records and securing long-term revenue streams through extensive power purchase agreements. This initiative underscores the company's commitment to accelerating its presence and impact within the rapidly evolving Indian renewable energy landscape.
The transaction, with an estimated worth of Rs48.59 billion, equivalent to about $509 million based on current exchange rates, will be financed directly by Purvah Green Power's parent company. The portfolio includes six distinct special purpose vehicle projects strategically situated across the Indian states of Rajasthan and Karnataka. A key feature of these acquired assets is their operational status, signifying immediate revenue generation and a demonstrated track record of performance. This aspect is crucial for a smooth integration and instant contribution to Purvah Green Power's existing asset base.
A significant portion of the acquired capacity, exceeding 90%, is secured by long-term power purchase agreements (PPAs) with the Solar Energy Corporation of India (SECI). The remaining capacity is contracted with various distribution companies within Karnataka. These agreements are uniformly structured for a 25-year duration, ensuring stable and predictable revenue for an extended period. The integration of these projects will fundamentally reshape Purvah Green Power's asset composition, elevating the proportion of revenue-generating ventures and expediting the overall development trajectory of its renewable energy holdings.
Shashwat Goenka, the vice chairman of RPSG, articulated the transformative impact of this acquisition, highlighting its role in significantly advancing the company's renewable energy journey. He emphasized that this acquisition grants an immediate operational scale, complementing their robust pipeline of contracted capacity and substantially propelling the platform's growth. Goenka reiterated RPSG's philosophy of combining disciplined greenfield development with judicious acquisitions that accelerate value creation, citing the high quality and long-term visibility of these assets as a compelling justification for the investment.
Prior to this acquisition, Purvah Green Power's contracted capacity stood at approximately 3.4 GWp. Upon the successful completion of this transaction, the company's total contracted capacity will surge to 4.8 GWp. Of this augmented capacity, 1.8 GWp is already operational, while an additional 3 GWp is currently undergoing various stages of construction. Furthermore, the company is actively developing 2.2 GWh of battery storage capacity, signaling its comprehensive approach to renewable energy integration. Established in December 2023, Purvah Green Power is dedicated to the development and operation of large-scale solar, wind, and hybrid renewable energy assets across India, with an ambitious target of accumulating a portfolio of 10 GW in the coming years.
This strategic acquisition represents a pivotal moment for Purvah Green Power, considerably enhancing its operational footprint and solidifying its position in India's renewable energy sector. By integrating these established solar projects, the company is set to achieve accelerated growth, benefit from secure long-term contracts, and further its commitment to expanding its clean energy capabilities nationwide.
