Adani Green Energy Limited (AGEL), India’s largest solar power developer, has announced the completion of a major joint venture deal with one of the world’s largest energy companies, TotalEnergies of France.
Under the terms of the agreement, first signed in September 2023, TotalEnergies has invested $300 million to acquire a 50% stake in a new joint venture with AGEL. The JV will house a large portfolio of operating and under-development renewable energy projects held by AGEL.
The portfolio includes 300 megawatts (MW) of already operational solar and wind plants, as well as another 500MW under construction and 250MW in the pipeline. TotalEnergies’ investment will support the further development of these clean energy assets across India.
In a statement, AGEL said the deal signifies a strengthening of its long-standing strategic alliance with TotalEnergies. The French firm holds a 19.7% stake in AGEL and has been a financial backer of its rapid expansion plans over recent years.
For TotalEnergies, acquiring the 50% JV stake fits with its ambition to vastly grow its global renewable energy business. The energy major aims to have 100 gigawatts (GW) of renewable generation capacity by 2030 through investments and partnerships worldwide.
Speaking about the deal’s completion, a TotalEnergies spokesperson said the company is committed to supporting India’s clean energy transition as a core market. “Together with AGEL, we will leverage our combined strengths to power more businesses and communities with low-carbon electricity from the sun,” they added.
AGEL currently has over 8GW of operating renewable capacity in India. It has set an ambitious target of reaching 45GW by 2030 through ongoing project construction and an extensive pipeline.
Just last week, the company raised approximately $1.4 billion through an issue of foreign currency bonds to partly fund this planned growth. Earlier in December, it also received board approval to raise $920 million more through a promoter equity infusion.
With total fundraising crossing $3 billion this year from various measures, experts say the cash injection will help AGEL fortify its balance sheet and move closer to the 45GW target. Much of the newly raised capital is expected to be deployed in 2023-24 across project acquisitions and constructions.
The recent partnership with TotalEnergies further enhances AGEL’s financial prowess. Analysts argue the JV will provide valuable technical expertise from the French company while addressing issues of constrained capital for AGEL. It allows both firms to leverage each other’s operational strengths.
Industry observers also note the deal shows overseas energy majors’ growing trust in Indian renewable developers’ ambitions and potential. Major investment deals such as this are attracting more foreign capital into drive India’s renewable capacity additions.
While India aims for 50% of its power capacity to come from non-fossil fuel sources by 2030, developer AGEL has established itself as a key driver with targets beyond that. The closing of this pivotal joint venture may enable further acceleration of the country’s clean energy transition.
