Piramal, APG to power Essel’s solar venture

The $132m investment will help the group ramp up its solar capacity

Essel owns 160 mega watts of solar independent power producer assets in four States.

Piramal Enterprises and Dutch pension fund asset manager APG Asset Management will invest $132 million (about Rs 900 crore) in Essel Green Energy, the solar arm of Essel Infraprojects Ltd.

Piramal Enterprises will make the investment through its Structured Investment Group. Essel Green Energy Private Ltd owns 160 mega watts of solar independent power producer (IPP) assets in four States. Sixty-nine per cent of the IPPs are operational. The investment would help Essel Group expand its solar capacity, which it plans to ramp up to 1000 megawatts in the next two or three years.

Jayesh Desai, co-head, Structured Investments Group, Piramal Enterprises Ltd, said, “The strategic alliance formed in 2014 between PEL and APG committed $1 billion for investments in infrastructure companies. We see great potential in green energy as a segment. Given the government’s focus on non-conventional energy and Essel Infra’s strong track record, we are confident that the investment will yield good results.”

The investment comes at a time when the government has set an ambitious goal of reaching 100 gigawatt sof solar capacity by 2022.

The present capacity is 5 gigawatts. This would mean achieving more than double the present solar capacity of China and Germany, the two biggest solar nations.

It also shows pension funds interest towards investing in infrastructure projects in India.

A recent report from Ambit and The City of London Corporation said sovereign wealth funds, global pension funds and insurance firms are interested to invest in infrastructure assets in India. It pegged that these firms would invest up to $50 billion in the infrastructure sector in the next five years.

“We view India as an attractive renewable energy market with favourable growth dynamics,” said Hans-Martin Aerts, Head of Infrastructure Investments, Asia Pacific, APG.

Ashok Agarwal, CEO and Whole-Time Director, Essel Infraprojects Ltd, said, “Essel Group has ambitious plans to expand its footprint in the Green Energy field. With the impetus provided by the government we are upbeat about the outlook for the industry.”