After Solar & Wind, Adani Green Bets Big On PSP Business

GUVNL Issues List of Tenderable PHP Sites With 14 GW Capacity

Adani Green Energy Limited (AGEL) has now planned to go bullish on Pumped Storage Projects (PSPs) in India. The company, while declaring its latest Q4 results talked about adding 5 Gigawatt (GW) of Pumped Storage Projects (PSPs) by 2030. With a fresh thrust on PSPs, the renewable company upgraded its renewable capacity target from 45 GW to 50 GW by 2030.

In its latest investors call, the management of the firm talked about the cost-effectiveness of this technology compared to battery storage systems. It, however, also admitted that these projects are often infrastructure-intensive projects. However, it was optimistic to derive good margins with the available market tariffs. 

The top management of the company said that Adani Green Energy Limited (AGEL) had been India’s first and fastest company to add 10.9 GW of operational greenfield capacities. It also said that it has now aimed to add around 6 GW of new capacities in FY25 which could be increased to up 8 GW per year in the next 2-3 years. 

The management told its investors that compared to batteries, PSPs are cheaper though complex in nature. It has already planned to commission its first 500 MW of PSP project in Andhra Pradesh. The firm said that works on that front have already started and it is likely to be commissioned by FY27. 

The team said that the tentative capital cost for PSP projects comes to around Rs 4.5-5 crore/MW. The management said that more tenders on storage would come in the next few years. It admitted that the majority of the players in India currently are betting on batteries under storage projects. 

The management also told its investors that currently it has planned to remain confined to utility-scale renewable projects and would not be interested in venturing into the rooftop solar segment. It also anticipated an increase in the production of DCR solar modules and cells in India in the next two years and the subsequent decline in their prices, which are currently pegged around Rs 24 per watt. 

PSPs in India

Pumped hydro projects (PHP) or Pumped Storage Projects (PSPs) are used as an alternative to Battery Energy Storage Systems. These are large storage projects which are used to store renewable power and deliver it instantly when required. PSPs consist of two water reservoirs at different altitudes. When there is less required renewable power, this clean power is used to pump water from the lower reservoir to the higher reservoir. When there is a need for renewable power for the grid, these structures can pump water from the upper reservoir to the lower reservoir, connected through a turbine. The movement of turbines thus creates clean power to be used.

In India, the majority of the PSP projects are built by the government, Central Public Sector Enterprises (CPSEs) and State PSEs due to the requirement of funds, number of permissions and others. The Ministry of New and Renewable Energy (MNRE) has also issued a framework on PSPs to ease out the permissions required for PSP projects that are away from the river banks. This is in addition to some of the other provisions meant to boost the growth of PSPs in India.