Chinese solar panels manufacturer Hareon Solar Technology Co Ltd (Hareon) is partnering private equity firm Nereus Capital (Nereus) to develop over 150 MW of solar power projects in India over the next two years, as per a statement.
This partnership follows Hareon’s announcement earlier last month that it has planned to establish a subsidiary in India to invest in photovoltaic projects in the country.
Nereus’ India Solar Investment Trust seeks to generate stable yields by investing in utility-scale solar PV projects in India with creditworthy off-takers.
The exact nature of the deal is not clear but it appears to be another platform investment deal now becoming popular in real estate where a PE firm ties with a developer for a string of projects.
“India is a compelling and growing market for solar PV projects. By partnering with a leading Indian private equity firm, we are able to apply leading technology and end-to-end financing to efficiently develop and construct solar projects,” said Jie Zhang, VP of global business development of Hareon.
Founded in 2004, Hareon manufactures spanning wafers, cells, modules and PV power plants. The firm has more than 1.5 GW of annual cell capacity and more than 1 GW of annual module capacity. Hareon has built and grid-connected more than 500 MW of PV power plants globally as of December 31, 2013.
“We have reached an interesting inflection point for solar power in India, as a result of falling project costs and escalating electricity prices, it can now be cost-effective for certain industrial and commercial end-users of power in India to purchase solar power directly,” said Jonathan Winer, MD, Nereus.
Mumbai-based Nereus Capital is an affiliated company of $22.6 billion Northern Lights Capital Group, a multi-boutique asset management business, and seeks to invest in power generation, manufacturing of clean technologies and energy efficiency and infrastructure sectors.
Nereus Capital’s India Alternative Energy Fund had last year received a fresh $100 million commitment from overseas limited partners (LPs) for its maiden fund targeting $250 million. This investment came from Northern Lights Capital Group and US Agency for International Development (USAID). In 2012, the fund closed a $20 million commitment from International Finance Corporation, the investment arm of World Bank.
Nereus Capital has been looking to build a portfolio of 7-10 investments of $15-35 million each in India.
In 2013, India ranked sixth globally in annual solar capacity additions with installations of 1.1 GW. Hareon expects total installations, including utility, commercial and industrial sectors, of 8 GW in 2016.
(Edited by Joby Puthuparampil Johnson)