Europe’s Societe Generale has agreed to lend up to $1 billion for Nasdaq-listed ReNew Global’s energy transition projects over the next three years, at a time the Indian company aims to expand its footprint across green power and decarbonization. The financing would help develop ReNew’s projects in India and abroad.

The two entities have signed a memorandum of understanding (MoU) to collaborate on solar, wind, complex renewables, green hydrogen, energy storage and solar modules manufacturing, a ReNew statement said. The amount will include debt financing and advisory solutions.

Sumant Sinha, founder, CEO and chairperson of ReNew said: “This MoU represents a key milestone towards our ambitions in India and worldwide. Societe Generale is a trusted partner for accelerated deployment of renewable energy projects, and this collaboration will contribute towards India’s net zero goals.”

ReNew recently tied up JERA Co. Inc., Japan’s largest power-generation company, to study the development of a green ammonia plant in Odisha’s Paradip. The company also has a joint venture with Indian Oil Corp. and Larsen & Toubro for developing green hydrogen. In solar module manufacturing, it has 6.4 GW module capacity, and a 2.5 GW of cell manufacturing capacity is under construction. ReNew is also a beneficiary of the production-linked incentives scheme to develop modules, cells and wafers.

Katan Hirachand, chief executive and chief country officer of Societe Generale India said that ReNew’s commitment to the energy transition in India and beyond aligns with the lender’s focus on supporting clients’ sustainability journey. “This MoU marks an important step in our collaboration with ReNew – we look forward to supporting their significant growth ambitions and driving the deployment of green energy in the market,” it said.

Founded in 2011, ReNew debuted on Nasdaq three years ago by merging with a SPAC (special purpose acquisition vehicle). SPACs are publicly traded shell companies that merge with unlisted companies to take them public, skipping the time-consuming conventional route of initial public offering (IPO). At the time, the company said it would have an enterprise value of $8 billion.

ReNew reported a net loss of 321.6 crore in the December quarter, against a net loss of 401.3 crore a year earlier.

With its ambitious expansion plans across the green energy ecosystem, ReNew has been looking at options to raise funds both through asset sale and debt financing. In February, Mint reported that ReNew Energy Global Plc is in talks with Singapore’s Sembcorp Industries Ltd to sell solar energy projects totalling 350 megawatts (MW), with the deal estimated to be valued at around $241 million at the enterprise level and around $121 million in terms of equity.

In January, the company decided to sell its 300 MW solar project in Rajasthan to India Grid Trust for an enterprise value of $199 million. It has been exploring several stake sale opportunities, including selling a 30% stake in its 2.3 GW commercial and industrial projects. In July last year, it announced a joint venture with Malaysia’s Gentari Sdn Bhd to develop 5 GW capacity including solar, wind and energy storage projects.

Last month, ReNew said that it aims to double its renewable energy portfolio to 20 GW within the next four years. Its revenue-generating capacity stood at 9.52 GW as of 31 March 2024. Speaking to Mint, Sinha then said the company is shifting its focus to round-the-clock (RTC) renewable energy projects, and highlighted its preference for battery energy storage systems due to their shorter setup times for grid-scale implementation. ReNew has a joint venture with US-based Fluence to offer energy storage solutions in India. Tariffs from RTC projects have become competitive with those from conventional thermal power, according to ICRA, a professional investment information and credit rating agency.

ReNew operates 150 renewable energy sites across 10 Indian states, has a presence in the commercial and industrial (C&I) sector, and participates in the solar module and cell manufacturing ecosystem. The company contributed approximately 10% to India’s total solar and wind energy production in the last fiscal year.

During pre-market hours on 15 May, the shares of ReNew on Nasdaq were trading at $6, lower by 0.8% from its previous close.

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Published: 16 May 2024, 06:00 AM IST