Essel Infraprojects to sell its solar power business

Subhash Chandra’s Essel Infraprojects Ltd has mandated Investec to find a buyer for its solar business.

Essel’s move comes at a time when financing at the lowest cost has become key to success in India’s renewable energy sector after solar and wind power tariffs fell to record lows. Solar power tariff fell to a record Rs2.44 per kWh in May before firming up to Rs2.65 per kWh in an auction by the Gujarat government last month.

Essel Infraprojects, an Essel Group firm, has a presence across green energy, transportation, electricity transmission and distribution, and urban infrastructure. Essel Infraprojects has 685 megawatt (MW) solar capacity, with six of its 12 solar projects being operational. It also has a portfolio consisting of 163 MW of hydropower and 560 MW of wind power.

The London and Johannesburg Stock Exchanges listed Investec has a presence in the UK and Europe, South Africa, Asia and Australia.

India, the world’s third-largest energy consumer after the US and China, plans to achieve 175 gigawatt (GW) of renewable energy capacity by 2022 as part of its commitments under the global climate change accord. Of this, 100GW is to come from solar.

Solar sector has seen significant capacity addition and allocations in the past two years and developers are scrambling to raise capital to sustain business growth.