Welspun Energy to set up solar parks

The company already provides engineering, procurement and construction services to those who wish to set up solar energy capacity

The Welspun group’s energy business has plans to set up solar energy parks across four states.

The company has begun work onacquiring land for a 100 Mw one in Rajasthan.

It would need around 500 acres.

The average investment in a park would be around Rs 100 crore for land development and evacuation infrastructure such as sub-stations. It is also looking for investors in the parks.

“We are in talks with people who would want to set up solar capacity in the parks.

“It would be a one-stop shop where we will set up, generate, and evacuate power, along with operation and maintenance of the park,” said Vineet Mittal, managing director of Welspun Energy.

He hopes to see interest from diverse sources, such as global investors and power procurers like information technology parks, hotels, malls and others.

In Maharashtra, for instance, power sold by utilities to such commercial establishments is costly.

Hence, they plan their second solar park in the state in the next 24 months.

Mittal says power-starved states such as Andhra Pradesh, Karnataka and Tamil Nadu could be potential locations.

“Industrial demand would is picking up in Madhya Pradesh as well,” he said.

The company already provides engineering, procurement and construction services to those who wish to set up solar energy capacity.

Their solar EPC order book is around Rs 1,500 crore (Rs 15 billion).

Apart from services, Welspun has its own generating capacity of 111 Mw across solar and wind energy. Its long-term plan is to take it to 1,700 Mw by 2015-16.

By the end of the current financial year, they plan to set up 400 Mw.

In the next six months, the company is expected to raise Rs 1,500 crore (Rs 15 billion) in debt for four projects in solar and wind energy, accounting for 220 Mw.

Welspun is already generating cash from its projects and will rely on internal funding for its equity requirements.

“We will put in all the money we earn back into the business for the next five years,” said Mittal.

He expects the costs of clean energy and conventional power sources to homogenise by around 2016.

The stage for it has already been set, after the government decided to double the price of natural gas.

“The cost of coal-generated power will also continue to increase with the size of imports and it could even be indexed to international prices like (that of) oil. In solar and wind (energy generation), costs are frozen, with predictable operation and maintenance costs,” he said.