BII, Norfund, IndiGrid form a $300 mn business for greenfield transmission and BESS projects – EQ
In Short : British International Investment (BII), Norfund, and IndiGrid have formed a $300 million partnership to invest in greenfield transmission and Battery Energy Storage Systems (BESS) projects in India. The collaboration aims to support India’s transition to renewable energy by strengthening the grid infrastructure and improving energy storage capabilities. The initiative will enhance the reliability and flexibility of the power system, enabling better integration of renewable energy sources like solar and wind.
In Detail : New Delhi – IndiGrid has partnered with British International Investment (BII), the UK’s development finance institution and impact investor, and the Norwegian Climate Investment Fund, managed by Norfund, to form a new business in the green energy space.
Called EnerGrid, the platform will focus on bidding for and developing projects in greenfield transmission and standalone battery energy storage systems (BESS) in India, said a statement from IndiGrid, a Mumbai-based power transmission infrastructure investment trust (InvIT), backed by KKR.
“With the EnerGrid platform, IndiGrid, BII and Norfund, alongside KLP through KNI India AS, have committed around $300 million, with each partner contributing around $100 million,” it said.
This capital will enable EnerGrid to target projects worth around $1.2 billion over the next few years. Post commencement of commercial operations, these projects will be fully acquired by IndiGrid at a pre-agreed enterprise value.
On 10 July, Mint reported that investment firms including Norway’s state-owned Norfund and BII are eyeing a stake in IndiGrid’s new power transmission business with a projected equity value of around $250 million.
Earlier this year, IndiGrid announced the first phase of this partnership, under which BII and Norfund (through KNI India AS, Norfund’s joint venture with KLP, Norway’s largest pension company) invested in three of IndiGrid’s existing greenfield transmission projects.
BII and Norfund will provide access to capital from global development financial institutions and the Norwegian private pension fund, said the statement.
Commenting on the deal, which was signed during COP29, Harsh Shah, chief executive officer, and wholetime director of IndiGrid, said: “This partnership will ensure that while IndiGrid continues to look for synergistic brownfield projects to acquire, we can also meaningfully create a growth pipeline for us in the under-construction space.”
Tellef Thorleifsson, CEO of Norfund noted that the fund recognizes the crucial role that investments in transmission infrastructure play in achieving the India’s ambitious renewable energy targets.
“Unlocking capital to accelerate the energy transition is a central theme at COP29 in Baku, and we are delighted to announce this new partnership, which exemplifies our commitment to mobilizing the necessary capital,” the Norfund CEO said.
Srini Nagarajan, MD and Head of Asia at BII said that significant investment is required for India to meet its ambitious net zero target, especially in developing the country’s transmission infrastructure and energy storage capacity.
“This partnership will help to attract more private capital into a critical sector, which will facilitate the growth of renewable energy supply to meet growing energy demand sustainably and accelerate India’s journey towards a greener future,” Nagarajan said.
