Power sector infrastructure investment trust IndiGrid has deepened its partnership with British International Investment (BII), and the Norwegian Climate Investment Fund, managed by Norfund, to form a new $300 million platform, EnerGrid that will focus on bidding and developing greenfield transmission and battery energy storage systems in India.
Each partner will contribute around $100 million and this capital will enable EnerGrid to target projects worth approximately $1.2 billion over the next few years. Post commencement of commercial operations, these projects will be fully acquired by IndiGrid at a pre-agreed enterprise value, a release by the InvIT said.
This will be a mutually beneficial partnership where IndiGrid will lend its pole position in and understanding of the nuanced Indian energy sector, and BII and Norfund will provide access to capital from global development financial institutions and the Norwegian private pension fund.
Earlier this fiscal, IndiGrid had announced the first phase of this partnership, under which BII and Norfund (through KNI India AS, Norfund’s joint venture with KLP, Norway’s largest pension company) invested in three of IndiGrid’s existing greenfield transmission projects.
“The transmission sector is witnessing a bidding pipeline like never before which we are looking to leverage to drive growth,” said Harsh Shah, Chief Executive Officer, and Whole Time Director of IndiGrid.
“This partnership will ensure that while IndiGrid continues to look for synergistic brownfield projects to acquire, we can also meaningfully create a growth pipeline for us in the under-construction space,” he added.
“This partnership will help to attract more private capital into a critical sector, which will facilitate the growth of renewable energy supply to meet growing energy demand sustainably and accelerate India’s journey towards a greener future,” said Srini Nagarajan, MD and Head of Asia at British International Investment.
Significant uptick
The Indian transmission sector is experiencing a significant uptick in its bidding and development momentum on the back of the country’s increasing power demand, changing energy mix and focus on energy transition. According to the latest estimates released by Central Electricity Authority (CEA), India will require an additional 170,000 circuit km of transmission lines and 47 GW of BESS capacity over the next eight years to facilitate evacuation of its growing generation capacity.