Reliance Industries to invest $50 mn in US-based Breakthrough Energy Ventures

Reliance Industries Ltd has agreed to invest up to $50 million for a 5.75 per cent stake in the Delaware, US-based Breakthrough Energy Ventures II, L.P. (BEV).

This is the first investment by Reliance Industries after Chairman Mukesh Ambani announced a 15-year vision of building Reliance as a new energy company, at the annual general meeting on July 15.

“BEV seeks to find solutions to the climate crisis by flexibly investing to develop breakthrough energy and agriculture technologies. BEV will invest the funds raised from the investors to support innovation in clean energy solutions. The results of these efforts would have significant relevance for India and are expected to benefit the entire mankind and also provide good returns to the investors,” Reliance said in a statement.

BEV is a limited partnership newly incorporated company under the State laws of Delaware, home to US President-elect Joe Biden.

The capital contribution commitment of $50 million constitutes 5.75 per cent of the size of the fund contemplated at present. The said investment will be made in tranches over the next 8-10 years.

The transaction is subject to approval from the Reserve Bank of India.

At the AGM, Mukesh Ambani gave a peek into Reliance's long-term vision of steering the company “beyond oil to chemicals” and how he is “re-imagining” the entire energy platform.

“The catastrophic impact of climate change calls for the legacy energy industry to reinvent itself on a war footing. Furthermore, the world needs access to clean and affordable energy and this must be met, as it is a pre-requisite to ensuring quality of life for all people. To meet these twin challenges, the energy industry must understand that fossil fuels and renewables are not mutually exclusive or contradictory,” he told shareholders at the annual general meeting on July 15.

India’s fuel mix is dominated by thermal power (64 per cent), followed by renewable energy sources (22 per cent), hydro (13 per cent), and nuclear (1 per cent).

Reliance, Ambani said, will build an optimal mix of reliable, clean and affordable energy with hydrogen, wind, solar, fuel cells and battery. It will combine the strengths in digital, power electronics, advanced materials and electrochemistry to develop full stack electrolyser and fuel cell solutions.

“Transforming our energy business to tackle one of the biggest challenges before India and the world is our new growth opportunity. On successful implementation of this strategy, we target to become net carbon-zero by 2035,” he said on July 15.

“This model envisages a large coalition of global financial investors, reputed technology partners and start-ups working on futuristic solutions,” he said.

“The new energy business based on the principle of carbon recycle and circular economy is a multi-trillion opportunity for India and the world. It is also an opportunity to make clean and green energy abundantly available at an affordable price to every Indian, every Indian enterprise and every Indian utility,” he added.

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