Sterling and Wilson looking to expand hybrid energy storage business

Venkatesh Ganesh Mumbai | Updated on June 01, 2020

Bags project in Nigeria; eyeing opportunities in India, South Asia and Latin America as well

The Hybrid Energy Storage (HES) business of Sterling and Wilson is eyeing multi-million dollar projects in India, South East Asia, Africa and Latin America, as enterprises globally look to reduce their dependence on conventional energy.

Hybrid energy is defined as a mix of solar, wind, gas, diesel and battery energy storage. Sterling and Wilson Hybrid Energy Storage (HES) is a part of Sterling and Wilson, a part of the Shapoorji Pallonji Group, which is into solar Engineering Procurement Construction (EPC) projects.

Deepak Thakur, CEO of HES, told BusinessLine that hybrid energy solutions is a huge opportunity since many generation companies and power distribution companies in places like Africa are moving into renewables. “In places like Nigeria, which is the largest African economy, the government was struggling to meet power outages which would result in power availability only for a few hours,” he said.

Also, Nigeria, which is one of the largest oil producers in the world, relies on diesel generators for meeting daily power requirements.

Sterling and Wilson, which is present in Nigeria, won a project, which the renewable energy authority in Nigeria had bid out that mandates using of hybrid energy to power the needs of three schools using a combination of diesel and solar energy, with storage.

“We saved 1.3 lakh tonnes of carbon footprint, equal to three million trees and the energy could be stored for two days,” said Thakur. Sterling and Wilson HES is looking at projects which minimum size of 1 MW, across all geographies.

Apart from Africa, Sterling and Wilson is also looking at projects in India, South Asia and Latin America at a time when there is a push to meet climate change requirements set at the Paris agreement. The HES business is privately held and hence does not disclose financials.

Storage challenge

Even as renewable energy is slowly starting to replace fossil fuel-based energy, one of the big challenges is with regard to storage. Unlike thermal power, which can be generated as and when needed, wind/solar energy by its very nature is intermittent. If not used, it will be wasted and, hence, storage assumes significance.

Sterling and Wilson is betting on HES at a time when the Ministry of New and Renewable Energy (MNRE) has issued a draft policy for supply of round-the-clock (RTC) power from renewable energy projects in conjunction with thermal power projects. The rationale of the government is to bring down the cost of power purchase, increase the penetration of renewable energy and overcome the intermittency issues related to renewable energy.

Further, it is aimed at discoms to fulfil their Renewable Purchase Obligation (RPO) requirements as they can replace expensive power procured from thermal power projects. Coal-fired power costs around ₹4.5 per kWh, whereas solar hovers around ₹2.50-2.87 per kWh.

“Energy storage will be crucial for RTC power,” stated Thakur.

Further, HES is also eyeing opportunities in areas such as Leh-Ladakh, or islands such as Andaman and Nicobar where grid connectivity is challenging and the cost of power is much higher than other places. “Our estimate is that the cost of power per unit is 12 times more expensive there,” said Thakur.

Published on June 01, 2020

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