An immediate fallout of the US’s bribery charges against Adani group would be a slowing of the pace of its massive renewable energy (RE) ventures, and a delay in start of cash flows from the power supply contracts that looked lucrative and but have now come under a cloud.
The latest developments could also have potential adverse implications for capital moblisation and stymie the $100 billion investment plan outlined by the group for “green transition and transport” by 2030.
At stake is mainly the long-term power purchase agreement (PPA) for 8,000 MW (8 GW) signed by Adani Green Energy Ltd (AGEL), with Andhra Pradesh discoms in 2023-24. AGEL, the flagship RE company of the now-diversified group, had won manufacturing-linked solar tender for this capacity from state-run Solar Energy Corporation of India (SECI) way back in June 2020 via auction route. This was the largest PPA signed by the group for RE and dwarfed all previous contracts (see chart). The fixed tariff for the 8GW PPA was Rs 2.92 per kWh for a period of 25 years.
Also Read Cornerstone Ventures eyes investments in SaaS segment High GST is preventing innovation in the carbonated beverages industry in India Nifty to consolidate in 24,000-24,500 range, says Religare Broking Subtle shift to CPSE policy, some firms see fresh capital infusion
Also ReadPiyush Goyal urges industry to play proactive role in helping govt in Ease of Doing Business agenda, raise quality standards
SECI declined to comment on whether it would cancel the PPA, adding that no formal documentation has been received by it. Speaking to a TV channel, SECI’s chairman and managing director, RP Gupta said there was “no basis to probe anything at this point,” and noted that SECI wasn’t facing any allegations. He, however, refused to comment on the veracity or correctness of the charges levied by the American court order against Andhra Pradesh and other state governments named in the US court filings.
The ministry of new and renewable energy declined to comment on the developments.
According to the US court filings, following the promise of bribes to Indian government officials, in or about and between July 2021 and February 2022, discoms of Odisha, Jammu and Kashmir, Tamil Nadu, Chhattisgarh and Andhra Pradesh entered into Power Sale Agreements (PSAs) with SECI under the manufacturing-lLinked project.
» Read More
