Published on September 12th, 2020 |
September 12th, 2020 by Saurabh
RattanIndia Group became the latest Indian developer to have sold operational assets. According to media reports, Global Infrastructure Partners (GIP) acquired 306 megawatts of solar PV power projects from RattanIndia Group. The transactions is valued at close to $230 million.
The portfolio includes utility-scale projects totalling 297 megawatts and 9 megawatts of rooftop solar power projects. The large-scale projects are spread across four states — Karnataka, Maharashtra, Uttar Pradesh, and Rajasthan. These projects have long-term power purchase agreements signed with government-owned companies, like Solar Energy Corporation of India and India’s largest power generator, NTPC.
Group’s power generation business is not very old and was set up in 2016. It commissioned its first projects in 2017–2018. Tariffs for most of the projects are between Rs 4.50 (US¢6.12) and Rs 5.00 (US¢6.81) per kilowatt-hour. This is nearly double the tariff rates quoted by project developers in recent solar power tenders.
Power purchase agreements with government companies at attractive rates ensures a healthy revenue stream for 25 years.
RattanIndia had secured these projects through competitive auctions. However, for the two to three years the company has stopped participating in auctions, perhaps due to the entry of new companies and increased competition.
Like many other private power generation companies, RattanIndia is also facing a financial crunch. The company has two thermal power plants which are not doing well. One of those projects is awaiting a bailout or possible sale. The company has also shelved plans to expand the other thermal power plant.
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