Fortum to aid India’s solar projs with €400m
Fortum, the Finnish utility firm announced that it would invest 200 to 400 million Euros in solar power projects in India.
The company in a statement said, “Fortum seeks to allocate, of its planned growth capital, in the range of 200-400 million euros in solar projects in India.”
The Indian government has plans of boosting up the generation of solar power to 100 gigawatts, by 2022. Currently the solar generation in the country is only 5.25 gigawatts.
Fortum’s spokesman opined that, “India offers one of the best solar resources and a sound government support for the development of solar sector. The country provides a good platform for Fortum to further develop its business in solar also elsewhere.”
The companies normally win the auction for the solar projects if they can bid the lowest tariff. Last January auction, the tariff rates reached a low of 4.43 rupees per kilowatt-hour.
Fortum in a statement added that it has “decided to bid for additional 100 MW in India, with a fixed tariff for 25 years. Some large-scale greenfield development will be targeted to enable economies of scale.”
Fortum has a solar capacity of 15 megawatts in India. It also won a reverse auction for 70 megawatt project with a fixed tariff for 25 years.
The company is also considering, “possible partnerships or other forms of cooperation, which would in the long-term create a more asset-light structure.”
Other companies that are investing in solar projects in India include, Canada's SkyPower Ltd, SunEdison Inc of US, a local unit of France's Solairedirect SA and Japan's SoftBank Group Corp.
The company also said that, considering the current business portfolio, the project offers a much wider geographic scope.
The statement said, "With technologies rapidly maturing, utility competencies are becoming increasingly important in solar business, and expansion in solar fits well in Fortum's vision to be the forerunner in clean energy. Overall, Fortum is targeting a Gw-scale wind and solar portfolio.”
The solar projects in India are selected through various state, central and public sector undertaking schemes. Taking into account the financial targets of Fortum group, it would guarantee a long term purchase agreement.
to success.