Adani Group signs MoU with Tamil Nadu for solar projects

The Adani Group has signed a memorandum of understanding (MoU) with the Tamil Nadu government, in India, for the installation of multiple solar power plants with a total capacity of over 600 MW.

To be located in the Ramanathapuram district of Tamil Nadu, India, the local government announced that a total of five solar power sites will be installed with a total capacity of 648 MW. Adani will set the projects up for a total cost of Rs45.35 billion (US$715 million).

Construction is expected to begin this month and the sites should be operational by March 2016. A power purchase agreement (PPA) will be signed by Tamil Nadu Generation and Distribution Corp. at Rs7.01 (US$11 cents) per unit for 25 years.

Internal accruals will account for roughly 70% of the investment in the projects, with debt and institutional investors funding the balance.

Outside of the Tamil Nadu region, the Adani Group is installing solar plants with a total capacity of 5 GW in Rajasthan, 10 GW in Jharkhand and 5 GW in Gujarat. The company plans to add 10 GW of solar generating capacity in India by 2022.

A 400 KW transmission line will be set up between Ramanathapuram and Kamuthi to transmit the power generated, at a cost of approximately Rs4.35 billion (US$68.6 million).

The Tamil Nadu government launched a new solar energy policy in 2012, calling for the development of 1 GW per year through 2015. The state's Minister of Electricity, Natham R. Viswanathan, disclosed that the government also plans to purchase roughly 1 GW every year.