IndiGrid partners with BII, Norfund, and Techno Electric to develop transmission projects in India

During FY24, IndiGrid [BSE: 540565 | NSE: INDIGRID], operationalised its first greenfield ISTS project, Kallam Transmission Limited, and won five additional projects, across ISTS and Battery Energy Storage System (BESS), with a tentative capex outlay of ~INR 2,000 crores to be deployed over the next 12-24 months.

IndiGrid India’s first and largest listed power sector infrastructure investment trust (InvIT), has partnered with British International Investment (BII), UK’s development finance institution and impact investor, the Norwegian Climate Investment Fund, managed by Norfund, and Techno Electric and Engineering Company Limited (Techno) to collaboratively undertake development of IndiGrid’s greenfield Interstate Transmission System (ISTS) projects.

During FY24, IndiGrid [BSE: 540565 | NSE: INDIGRID], operationalised its first greenfield ISTS project, Kallam Transmission Limited, and won five additional projects, across ISTS and Battery Energy Storage System (BESS), with a tentative capex outlay of ~INR 2,000 crores to be deployed over the next 12-24 months.

Under this partnership, BII and Norfund (through KNI India AS, Norfund’s joint venture with KLP, Norway’s largest pension company) will invest in IndiGrid’s three ISTS projects won last year and currently under construction: Ishanagar Power Transmission Limited (IPTL), Dhule Power Transmission Limited (DPTL), and Kallam Transco Limited (KTCO). These projects are expected to support the evacuation of renewable energy to ~6 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 an entire stake in these projects once they are operational and revenue-generating.

Commenting on the development, Harsh Shah, Chief Executive Officer, and Whole Time Director of IndiGrid, said, “On the back of India’s commitment to energy transition and grid parity across renewable energy technologies including BESS, we are witnessing tremendous investment opportunities in our target areas. This offers a compelling prospect for investors with preference for sustainability. We are delighted to partner with marquee Development Financial Institutions like BII and Norfund for our current under-construction projects to realize a shared vision of making an impact in the energy transition journey. Our partnership earlier with IFC and now with BII and Norfund is a testament to our strong commitment to aligning with leading ESG standards in our businesses.”

“We also look to deepen our engagement with Techno Electric, a leading EPC developer with an established track record, to partner across an extended portfolio of projects. IndiGrid will continue to work with like-minded partners to participate in the immense greenfield opportunity landscape of the Indian ISTS sector.”

Commenting on the partnership, Rohit Anand, Head of Infrastructure Equity, Asia at British International Investment, said: “India requires a substantial investment of ₹ 4.75 trillion in the transmission sector to facilitate integration of renewable energy capacities and meet its decarbonization 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 which is a vital part of India’s energy transition.”

Commenting on the partnership, Bjørnar Baugerud, Head of the Climate Investment Fund at Norfund, commented, “Huge investments are needed in the Indian transmission infrastructure to facilitate the government’s ambitious climate goals and speed up the energy transition. 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.”

Eric Nasby, Investment Analyst at KLP, further added: “With a rapidly growing economy, India has a rising need for access to renewable energy to produce electricity. We expect this partnership to have a strong climate impact as well as generate attractive returns for KLP and its owners.”

Techno Electric Chairperson, Mr. Padam Prakash Gupta, highlighted: “As a pioneer and lead in the energy transmission sector, Techno is immensely proud and honored to collaborate with IndiGrid, BII, and Norfund in advancing India’s transmission story. This partnership represents a significant milestone for us, reflecting our commitment to leading the transformation of the energy landscape in India. With our deep execution capabilities, a strong balance sheet, and a shared vision for sustainable growth, we view this collaboration as a long-term strategic partnership that will shape the future of energy transmission in the country.”