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Birla Power Arm Eyes JV With US Firm In Solar Energy

29 June, 2010

The diversified Yash Birla Group is likely to sign a joint venture agreement with a US-based company to set up and maintain solar power plants in India.

According to sources, Birla Urja Ltd, a power utility subsidiary of Birla Power Solutions Ltd., (BPSL), is in advanced stage of talks with the US-based solar energy service provider,  which manages over 300 sites globally.

The proposed JV will focus on building, managing and maintaining grid connect solar power plants for BUL.  It is learnt that the US firm has been developing, financing, operating and monitoring solar plants for two decades. An email sent to Yash Birla Group spokesperson did not elicit any response.

Recently, the group announced that Birla Power Solutions Ltd., (BPSL) will invest Rs 3,000 crore to set up a 600MW coal-fired thermal power plant that will be commissioned within the next three years under Birla Urja Ltd. BPSL will additionally invest Rs 2,000 crore to set up 125MW of solar photo-voltaic power plants over the next three years.  In the first phase, the allocation will be divided as: Haryana (10 MW), Uttarakhand (5 MW), Rajasthan (5 MW) and Andhra Pradesh (50 MW).

BUL has already applied for allocation of 300 acres from the Andhra Pradesh Government for setting up a 50 MW solar PV grid Connect Power Plant and already applied for licenses for setting up these Photovoltaic grid Connect Power Plants, a person close to the development said. Photovoltaic (PV) is popular method for converting energy from the sun into electricity by using solar cells. Solar PV cells convert solar radiation into direct electricity.

The government has recently announced its solar energy mission to produce 20,000 MW of power by 2022 under Jawaharlal Nehru National Solar Mission. In the first phase, 1,100 MW of grid solar power and 200 MW capacity of off-grid solar applications will be set up utilising both solar thermal and photovoltaic technologies. The government will designate NTPC Vidyut Vyapar Nigam (NVVN), the power trading arm of the NTPC for the purchase of solar power generated by independent solar power producers, at rates fixed by the Central Regulatory Electricity Commission.

The new venture, BUL was formed last year eyeing deployment of latest technology to build, operate and own utility scale power plants in the thermal and the renewable energy sectors. The thermal plant will function as a captive unit supporting the various group manufturing facilities. The company also plans to utilize the surplus power produced for trading as a merchant trading company.

Birla Power Solutions Ltd (BPSL), established in 1984 in collboration with Yamaha Motor Co, provides power solutions to north-east states in managing rural health centres. BPSL is listed with BSE, NSE and Luxembourg stock exchanges. BPSL has another subsidiary in the area of renewable energy-Birla Energy Infra Ltd, which specialised in providing concept to execution solutions to large scale power plant projects in solar, wind, biomass and other renewable energy sectors.

This month, PTI had reported that US-based American Capital Energy and MSM Energy will soon announce a solar energy joint-venture for engineering, procurement and construction of projects in India.  The new entity will immediately begin providing photovoltaic solar engineering, procurement and construction (EPC) to the Indian market, the report said. In January, Moser Baer PV, a subsidiary of Moser Baer India, announced plans to invest a maximum of $125 million for manufacturing solar photovoltaic cells in 2010-2011.

The tremendous potential of the renewable energy has triggered a spate of private equity investments. The International Finance Corporation (IFC), a World Bank arm, invested $10 million in Azure Power India, a solar energy producer in March 2010 and in Bhilwara Energy and Auro Mira Energy. Last month, Azure Power had partnered with SunEdison, North America’s largest solar energy services provider, for developing a 15 megawatt (MW) photovoltaic solar power plant in Gujarat. According to VCCEdge data, since 2004, 17 deals worth $180 million took place in renewable energy sector in India. This year, Hyderabad-based Greenko Group received $34 million investment from TPG Capital Inc.


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Birla Power Arm Eyes JV With US Firm In Solar Energy

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