Tuesday, February 8, 2011

Suzlon inks $1.28-billion deal with Caparo Energy

Suzlon Energy has inked the single largest deal by an IPP for wind power projects in India with Caparo Energy (India). The deal, for 1,000 mw of wind power projects, is worth $1.28 billion. For the debt ridden Suzlon, a growth in the domestic market is welcome as the company enjoys higher margins in the country.

Caparo Energy India (CEIL) is a wholly owned subsidiary of Caparo Energy (CEL) with a market capitalisation of approximately Rs 1,400 crore. CEIL is focused on becoming a major wind power IPP in India. CEIL’s first 500 mw project is to be commissioned by March 2012 and another 500 mw is to be commissioned progressively by March 2013.

Tulsi R Tanti, founder & CMD of the Suzlon Group, said this had been a strong year for wind power in the Indian market. “With large players like Caparo entering the market, we are also seeing large wind IPPs in India becoming a major force, in addition to the strong captive and small-size IPP segment. We are also seeing growing interest of overseas investors to deploy funds through the IPP-route,” Tanti said. Caparo’s ambitious plans underscore the maturity and growing appetite for IPPs in India’s energy matrix and more importantly, in the renewable energy space, he said. Till now the largest IPP deal in the domestic market for Suzlon was worth Rs 1,149 crore for 202 mw from the Techno Electric Group.

Angad Paul, non-executive chairman of CEL, said the recent improvements in the regulatory framework, such as the revised feed-in tariffs, renewable purchase obligation, generation-based initiatives and renewable energy certificates gave the company opportunity for value creation using a combination of various revenue options.

“India’s energy market is one of the world’s most buoyant. With the supportive regulatory framework for wind energy, we see a great opportunity to invest as an IPP in what is the world’s fifth largest wind energy market,” Paul said.


Source: Suzlon inks $1.28-billion deal with Caparo Energy

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