Tata Communications Ltd plans to buy 5.76 per cent stake in Tamil Nadu-based Green Infra Wind Generation Ltd as part of its plans to use power from alternative energy sources.
Under the proposal, Tata Communications plans to buy 10 million units of power, which is about 30 per cent of its annual power requirement in Tamil Nadu, from Green Infra.
Tata Communications already has an agreement with Green Infra to procure 13 million units. The additional procurement will take Tata Communication's to 23 million units.
The telecom company has sought Government's approval for executing the deal.
This is the second such investment by Tata Communications.
According to an internal Department of Telecom note seen by Business Line, the company has already invested Rs 7.8 lakh in Green Infra Wind Farms Ltd for a 9.75 per cent stake.
The telecom company's board has approved buying up to 15 per cent stake in Green Infra Wind Farms Ltd. Under that deal also Tata Communication had entered into a power purchase agreement with Green Infra for buying 20 million units at Rs 4.60 a unit.
Tata Communications committed to buy at least 10 million units with provision to draw another 10 million subject to availability and need. The company saved Rs 1.1 crore through the arrangement, according to the DoT note.
Both the green power entities are backed by IDFC PE. Green Infra recently won two projects of 25 MW in the second round of bidding of the National Solar Mission. Green Infra's quote of Rs 9.44 a unit (averaged for the two projects) was the highest among the 20-odd winners.
The company also has a 10 MW solar plant operating in Gujarat. It also has 165 MW of wind power capacity and expects to add another 135 MW in the next two months. Green Infra Ltd, in 2009, had announced its acquisition of BP Energy India Pvt Ltd for an enterprise valuation of $95 million.
Renewable energy has become important for telecom companies in the wake of TRAI's recent regulation directing all telecom service providers to ensure that part of the power that is used for the towers comes from renewable sources.
Under the new rules, at least 50 per cent of towers and 20 per cent of the urban towers are to be powered by hybrid energy sources (renewable and grid) by 2015. The move is aimed at reducing carbon emissions due to increased dependence on diesel.