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In an effort to develop interstate transmission system (ISTS) projects in the country, IndiGrid, a power sector infrastructure investment trust (InvIT) has partnered with British International Investment (BII), Norfund and Techno Electric and Engineering Company (Techno). The partnership is aimed at collaboratively undertaking the development of IndiGrid’s greenfield Interstate Transmission System (ISTS) projects.
Under this partnership, BII, which is the United Kingdom’s development finance institution along with Norfund (through KNI India AS, Norfund’s joint venture with KLP), will invest in IndiGrid’s three ISTS projects that are currently under construction. They include Ishanagar Power Transmission or IPTL, Dhule Power Transmission or DPTL and Kallam Transco or KTCO.
These projects are expected to support the evacuation of renewable energy to around six gigawatts (GW) in the states of Madhya Pradesh and Maharashtra. Additionally, Techno will co-develop the IPTL and DPTL projects. Techno will invest minority capital and will also be responsible for the complete execution of the projects on a Lump Sum Turnkey (LSTK) basis.
IndiGrid will be acquiring the entire stake in these projects once they are operational and revenue-generating.
Harsh Shah, Chief Executive Officer (CEO) and Whole Time Director of IndiGrid said, “We are delighted to partner with marquee Development Financial Institutions like BII and Norfund for our current under-construction projects to realise a shared vision of making an impact in the energy transition journey.”
During the Financial Year 2024, IndiGrid operationalised its first greenfield ISTS project, Kallam Transmission, and won five additional projects, across ISTS and Battery Energy Storage System (BESS), with a tentative capital expenditure outlay of Rs 2,000 crore to be deployed over the next 12 to 24 months.
Commenting on the partnership, Rohit Anand, Head of Infrastructure Equity, Asia at British International Investment, said, “India requires a substantial investment of Rs 4.75 trillion in the transmission sector to facilitate the integration of renewable energy capacities and meet its decarbonisation goals. As a long-term partner and committed climate finance provider to India, we are delighted to bring not just our capital but also our ESG expertise to support the transmission sector.
Bjørnar Baugerud, Head of the Climate Investment Fund at Norfund, stated, “Through this investment and our new partnership, we are happy to be able to contribute to connecting new renewable energy capacity to the national grid and achieve the country’s 500 GW of renewable capacity target”
Techno Electric Chairperson Padam Prakash Gupta, highlighted, “This partnership represents a significant milestone for us, reflecting our commitment to leading the transformation of the energy landscape in India.”
Eric Nasby, Investment Analyst at KLP, added, “We expect this partnership to have a strong climate impact as well as generate attractive returns for KLP and its owners.”
