Adani Green Energy 's ambitious Rs 7,000 MW solar power supply agreement with Andhra Pradesh has encountered a significant hurdle, as the state government seeks a waiver of centrally-mandated transmission charges. This development could potentially impact one of the largest renewable power supply agreements in India.

Transmission Fee Dilemma

The crux of the issue lies in the transmission fee, which could increase solar power costs by approximately 40.00%. However, waiving this fee is not a straightforward process, as it would require policy-level intervention due to its embedment in central regulations.

Agreement Details and Current Status

The agreement, inked in 2021, involves three key parties: Adani Green Energy, the Andhra Pradesh government, and the Solar Energy Corporation of India (SECI). Under the terms of the deal, Adani Green is poised to supply 4,312 MW of solar power to the state.

Adani's Readiness and State's Hesitation

Since April, Adani Green Energy has been proactive, sending multiple communications to the state, expressing its readiness to commence power supply. However, the state's reluctance to begin drawing power, primarily due to the transmission fee issue, has created a stalemate.

Broader Implications

This situation adds another layer of complexity to Adani Green Energy's operational landscape, which is already navigating through various regulatory and legal challenges. The resolution of this issue could have far-reaching implications for the renewable energy sector in India, particularly concerning the structuring of large-scale power purchase agreements.

Market Response

Despite these challenges, Adani Green Energy's shares closed 2.80% higher at Rs 896.15 on Wednesday, indicating that investors remain optimistic about the company's prospects.

The outcome of this situation will be closely watched by industry stakeholders, as it could set a precedent for future large-scale renewable energy projects in the country. The resolution may require a delicate balance between state interests, central regulations, and the commercial viability of renewable energy projects.

Adani Green Energy Limited (AGEL) has further strengthened its position in the renewable energy sector by commissioning new solar and wind power projects in Gujarat. The company's subsidiary, Adani Hybrid Energy Jaisalmer Five Limited, has successfully brought online a 50 MW solar power project and a 31.2 MW wind power project at Khavda, Gujarat.

Project Details

The commissioning of these projects, totaling 81.2 MW, took place on September 30. The decision to commence operations was made on October 1 at 10:01 p.m., following the receipt of all relevant clearances. This strategic move aligns with AGEL's commitment to expanding its renewable energy portfolio and contributing to India's clean energy goals.

Capacity Expansion

With the addition of these new projects, Adani Green Energy Limited has significantly increased its operational renewable generation capacity. The company's total capacity now stands at 16,679.80 MW, reinforcing its position as a major player in India's renewable energy landscape.

Recent Developments

It's worth noting that this commissioning comes on the heels of another recent expansion by AGEL. Just a day prior, on September 30, the company had operationalized an aggregate of 112.5 MW of power projects at Khavda, Gujarat, through various stepdown subsidiaries. These projects included:

Market Impact

The rapid expansion of AGEL's renewable energy portfolio demonstrates the company's commitment to sustainable power generation and its ability to execute large-scale projects efficiently. As India continues to prioritize clean energy sources, Adani Green Energy's growing capacity is likely to strengthen its market position and contribute significantly to the country's renewable energy targets.

The commissioning of these projects not only enhances AGEL's operational capacity but also underscores the company's role in driving the transition towards a greener energy future in India.