Tata Power earmarks Rs 75,000-crore capex for renewables in next 5 years

Tata Power has earmarked a capital expenditure of more than Rs 75,000 crore over the next five years, of which Rs 10,000 crore would be invested in this financial year. The company is planning to increase its green energy share to 60% over the next five years.

The Tata group firm, which had added 707 MW capacity across renewables in FY22, has a Rs 13,000-crore order book in its solar engineering, procurement and construction (EPC) business. It would invest Rs 14,000 crore across segments in this fiscal, Tata Power chairman N Chandrasekaran said in reply to shareholders’ questions at the company’s annual general meeting on Thursday.

“Tata Power is looking to scale its generation capacity to over 30 GW by FY27 from the current 13.5 GW with an increased clean energy portfolio from current levels of 34% to 60% by 2027 and 80% by 2030. In Transmission & Distribution (T&D) business, the company will further optimise the Odisha discom operations, stabilise the new acquisition in the transmission business and deliver phenomenal customer service, enabled by digitalisation,” Chandrasekaran said.

The firm is also setting up a 4 GW solar cell and module manufacturing capacity in Tamil Nadu with an investment of Rs 3,000 crore. In addition, Tata Power is focused on growing consumer-centric and new-age energy solutions such as rooftop solar, electric vehicle chargers, solar pumps, smart metering and energy management solutions among others.

Earlier in April, Tata Power had raised Rs 4,000 crore from Blackrock Real Assets and Mubadala Investment company for its renewable energy subsidiary, Tata Power Renewable Energy.

India’s green energy push gained momentum during FY22, intensifying further with the strong commitments made at the 2021 United Nations Climate Change Conference (COP26) in Glasgow. India made a historic announcement of becoming a net-zero emitter by 2070 with 500 GW of non-fossil capacity by 2030 and meeting 50% of energy requirements from renewable energy by 2030, he said, in his address to shareholders.

In FY22, Tata Power’s generation revenue rose by 28% and the return on capital employed rose 7.8% from 7.2% a year ago. The company also declared a dividend of Rs 1.75 per share in FY22. The higher commercial and industrial activities boosted the power demand by about 8% in FY22, with peak power demand breaching the 200 GW mark for the first time, during July 2021, he added.

Tata Power is also looking at becoming a benchmark in the Environmental, Social and Governance (ESG) benchmark in the power sector.

“In this pursuit, we have set ourselves on the path for three key goals of becoming carbon net-zero by 2045, 100% water neutral by 2030 and zero waste to the landfill before 2030,” he added.

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