Finnish firm Fortum on Tuesday said it was planning to invest 200-400 million euros (Rs 1,500 crore – Rs 3,000 crore) in solar power projects in India, joining firms from Canada to Japan that are looking to tap into the country’s growing renewable energy sector.
The government plans to increase solar power generation capacity to 100 gigawatts (GW) and 60 GW of wind power by the end of 2022.
“India is the first country Fortum has decided to enter, as the country offers one of the best solar resources and sound government support for development of the sector. The country provides a good platform for Fortum to further develop its business in solar energy and also elsewhere,” said a company statement on Tuesday.
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Currently, the company’s solar activities are exclusively based in India, where it has 15 megawatts (MW) of capacity.
The company is targeting a gigawatt-scale wind and solar portfolio.
It has a total power generation capacity of about 13,700 MW, mostly through hydropower, nuclear energy and combined heat and power plants that use a variety of fuels such as biomass, waste and fossil fuels, according to its website.
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“For solar projects in India, Fortum seeks to allocate funds in the range of euro 200-400 million,” said the statement, adding that some large-scale greenfield development will be targeted to enable economies of scale and the company will consider seeking possible partnerships or other forms of cooperation on a long-term asset light model. The company is planning to select projects in India from various Central, State and Public Sectors Undertaking (PSU) schemes, which will guarantee a long-term power purchase agreement, taking into account Fortum’s financial targets.
India gets more than 300 days of sunshine a year.
On April 12, 2016, Fortum decided to bid for an additional 100 MW in India, with a fixed tariff for 25 years.