JSW Energy To Commission Three Green Energy Projects By Fiscal 2025

JSW Energy Ltd. plans to commission three green energy projects by financial year 2025 at an approximate cost of Rs 5,965 crore.

The projects span battery storage, green hydrogen production and solar module manufacturing under the Production-Linked Incentive scheme.

JSW Energy's one gigawatt-hour battery storage project in Fatehgarh, Rajasthan, is expected to be commissioned by 2023, Prashant Jain, chief executive officer at the company, told BQ Prime in an interview.

In January, the company received the 500 megawatt/1,000 MWh battery storage project from the Solar Energy Corp. of India under the build-own-operate-transfer model. The project will have a tenure of 12 years.

"While 60% of the capacity will be sold to SECI under a battery storage purchase agreement, the balance will be open for sale," Jain said. "We will approach the ancillary market for the open capacity."

The pumped storage plant of 2.4GWh—300 MW x 8 hours—from Power Company of Karnataka Ltd. is targeted to be commissioned in 36 months from signing of the power purchase agreement, with the PPA duration of 40 years.

A 2.4-GWh pumped hydro project in Karnataka will also be commissioned by fiscal 2026.

Jain said the two projects would cost JSW Energy Rs 4,200 crore—including Rs 2,200 crore for battery storage and around Rs 2,000 crore for the pumped hydro project.

The company has also contracted India's first 3,800-tonne commercial-scale green hydrogen production capacity with its group company, JSW Steel Ltd., to help them produce green steel, according to Jain.

JSW Energy will use its 25 MW round-the-clock renewable energy plant for this project.

The green hydrogen and oxygen produced from the electrolysers will be sold to JSW Steel under a seven-year offtake contract. This will be beneficial for both the companies as the hydrogen plant will be co-located at the JSW Steel complex and will use the existing microgrid for transmission, Jain said. "It will provide a mid-teen return on equity to JSW Energy."

The plant will cost Rs 165 crore and will be commissioned in 18–24 months.

The company has won a 1 GW solar wafer cells module manufacturing capacity under the PLI scheme in Rajasthan. The power producer has identified the location for setting up the facility and is seeking necessary approvals.

Supply chain risks, including high tariffs like basic customs duty on imported panels, are the biggest impediments in setting up the renewable capacities, he said.

Integrated manufacturing capacities will provide module security at economical cost, Jain said. The firm intends to utilise the solar modules for captive usage and will be eligible for around Rs 320 crore worth of benefits under the PLI scheme.

"Additional incentives from the state government are under negotiation," Jain said. The company expects to commission the project by April 2025 at an investment of Rs 1,600 crore.

Capital expenditure for the current fiscal is Rs 10,000 crore and 85% of it will be used towards renewable energy projects as the company aims to become a 20 GW firm by 2030.