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Finnish energy firm Fortum is open to acquiring existing solar power projects in India, even though its focus remains on greenfield growth.
“What we see is that we can add more value through greenfield projects.
“Our preferred option will be greenfield growth but we are not shying away from any M&A opportunity that might come.
“However, it has to be at the valuations that we feel comfortable with,” Sanjay Aggarwal, Managing Director, Fortum India, told BusinessLine .
Fortum recently announced an intention to invest anything between €200 million and €400 million in India with a target to have a giga-watt scale portfolio of solar and wind power projects.
Aggarwal said that there is no time-frame associated with the investment figure.
Fortum India has won projects under the National Solar Mission tenders in Rajasthan and Tamil Nadu. Both these projects were in solar parks.
However, the company is now conducting studies to participate in the state government tenders for solar projects as well.
“When we came in we wanted to first test the waters. We still want to gain experience, but depending on the state and the opportunity we will bid in the state tenders.
“We are studying the way the government’s Ujwal DISCOM Assurance Yojana plays out. It is only a matter of time before we bid in the state tenders,” said Aggarwal.
Upcoming projectsHe added that a power purchase agreement was signed for the Rajasthan project of 70 MW earlier in the week and agreement for the 100-MW project in Karnataka will be signed soon.
“Typically, the construction time for solar projects are 13 months, so after a year we should have an additional 170 MW of solar power generation capacity,” said Aggarwal.
Apart from the National Solar Mission projects, the company is already operating 15 MW of solar power capacity in the country.
“Some of the risks associated with solar power projects in India remain land acquisition and evacuation of the power.
“However, we have overcome this by participating in the NSM projects which mitigate these risks. NSM gives comfort to the developers,” Aggarwal added.
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