Adani Green Energy Ltd (AGEL) has announced a significant milestone in its renewable energy journey with the securing of $400 million in financing for its under-construction 750-MW s in Rajasthan and Gujarat. The financing, provided by a consortium of five leading international banks, underscores AGEL’s commitment to sustainable energy development and marks a significant step towards the completion of these projects.
The funds will support the construction of two key solar projects, one in Rajasthan with a capacity of 500 MW and another in Gujarat with a capacity of 250 MW. The Rajasthan project has a long-term power purchase agreement (PPA) with the Solar Energy Corporation of India (SECI), while the Gujarat project is a standalone merchant power project located at the world’s largest renewable energy cluster in Khavda.
AGEL’s decision to diversify revenue streams by venturing into the merchant energy market reflects its strategic approach to enhance project revenue and position itself favorably for sustained value creation. The financing transaction signals a shift in sentiment within the international banking market, with banks showing increased confidence in financing merchant projects.
The $400-million construction facility, along with syndicated guarantee-backed assurance programs, aligns with AGEL’s procurement strategy and ensures a sustainable debt structure for financing merchant exposure. The consortium of lenders includes Cooperative Rabobank U.A., DBS Bank Ltd., Intesa Sanpaolo S.p.A., MUFG Bank, Ltd., and Sumitomo Mitsui Banking Corporation.
The financing is housed under subsidiaries of AGEL and supports the company’s ambitious growth plans while aligning with its commitment to sustainability. The transaction also received a favorable assessment from Sustainable Fitch, highlighting the robustness and transparency of AGEL’s Green Loan Framework and its alignment with the Green Loan Principles, 2023.
AGEL’s operational portfolio, which currently stands at 10,934 MW, is the largest in India, comprising 7,393 MW of solar capacity, 1,401 MW of wind capacity, and 2,140 MW of wind-solar hybrid capacity. The company’s dedication to green energy solutions is driving India’s transition towards a lower carbon future, in line with UN Sustainable Development Goals, particularly SDG 7 (affordable and clean energy).
Latham & Watkins LLP and Saraf & Partners served as the borrower’s counsel, while Linklaters and Cyril Amarchand Mangaldas acted as the lenders’ counsel in this landmark financing transaction. With this financing secured, AGEL is well-positioned to continue its leadership in the renewable energy sector and contribute to India’s clean energy transition.
