ReNew Commissions First Of 3 ISTS Transmission Projects In Karnataka

After winning 3 transmission projects in Karnataka to date, ReNew has commissioned the first of those as part of their commitment to build transmission for ~5 GW of wind power, under (Inter State Transmission System) ISTS.

Central Transmission Utility (CTU), a Govt. of India owned entity and a wholly owned subsidiary of Power Grid Corporation of India Ltd (PGCIL), will be responsible for billing, collection & disbursement of revenues for these projects.

The “Koppal Transmission Scheme” was executed in a compressed time schedule and will help in transmission of 1,500 MW of renewable energy in the Koppal Area of Karnataka. The Koppal Transmission Scheme was awarded in FY 22 and covers construction of a new 400/220 kV Sub-station at Koppal along with 276 Ckt Km of 400 kV D/C quad moose transmission line with extension of the 400 kV GIS Bays at the PGCIL Narendra (New) Substation. Following the commissioning of the 1,500 MW Koppal Transmission Scheme, the remaining transmission for 3,500 MW is expected to be completed by June 2024.

Following the announcement, an agreement was signed yesterday on the second joint investment in the transmission sector with Norfund, the Norwegian Government’s Investment Fund for developing countries, and KLP, Norway’s largest pension company, through their joint company KNI India AS and ReNew. Norfund’s share is from Norway’s newly established Climate Investment Fund, managed by Norfund. This marks Norfund’s and the Climate Investment Fund’s ongoing support in the transmission sector, helping to accelerate the transition to renewable energy.

The investment by Norfund and KLP in ReNew’s transmission projects is in line with ReNew’s farm-down strategy, enabling ReNew to add further capacity. In addition, synergies in project execution and operations with ReNew’s inhouse capabilities and the role of these projects in enabling earlier commissioning of renewable energy projects, will enhance returns and derisk completion timelines for ReNew’s core RE development business.

ReNew’s 3 transmission projects in Karnataka are part of the ISTS for transmission of 5 GW of wind and solar power potential identified in Karnataka under Phase-I for implementation and interconnection with ISTS grid, for a period of 35 years.

The agreement to invest in the Gadag Project for a 49% stake is the second investment in the partnership, with an ambition for further joint investments. The expected levelized EBITDA for the project is ~$ 6.2m. The project consists of (a) 2 x 500 MVA 400/220 kV sub-station at Gadag with 400 kV D/C transmission line from Gadag substation to Narendra New substation and 400 kV GIS Extn at Narendra New in Karnataka and (b) 3 x 500 MVA 400/220 kV Augmentation at Gadag Substation with 400 kV D/C transmission line from Gadag substation to Koppal substation and 400 kV AIS bays Extn at Koppal & Gadag end. Its commercial operations are expected to start in two phases – in the last quarter of FY24 and first quarter of FY25.

Speaking about this partnership with Norfund and KLP, Kailash Vaswani, Group CFO of ReNew Private Limited said, “Investments in the transmission sector provide synergies with our core RE portfolio by enhancing certainty of connecting ReNew’s large RE development projects and demonstrates our success in capital recycling through which we have raised over half a billion of US dollars in equity over the past 2 years by selling stakes in assets. We are proud to partner with Norfund and KLP to support India’s green energy transition and look forward to strengthening this partnership in the future.”

Anne Beathe Tvinnereim, Norway’s Minister of International Development, said, “To secure the necessary investments for the vital energy transition, public funding must mobilise private capital. The signing between the Climate Investment Fund, ReNew and KLP is a great example of this. It also shows how Norwegian investments are helping India reach its goals of installing 500 GW of non-fossil capacity by 2030.”

Bjørnar Baugerud, head of the Climate Investment Fund at Norfund, said, “Strengthening the transmission infrastructure is critical to facilitate the dispatch of the necessary new renewable energy capacity to reach the climate goals in line with the plans of the Government of India. Through this second investment and our partnership with Renew, we are pleased to be able to contribute to the connection of another 2.5 GW of planned renewable power to the national grid.”

In recognition of its commitment to sustainability and ongoing progress, ReNew recently received a rating of 11.6 (low risk) from Sustainalytics, CDP Climate Change rating of B, Supplier Engagement Rating of ‘A-’ and upgraded from ‘A’ to ‘AA’ in ESG Ratings by MSCI. These ratings rank ReNew among the top companies globally for ESG.