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Power transmission lines. (Flickr) (Representative image)
Adani Energy Solutions Limited (AESL) has announced the successful financial closure of its $1 billion green high voltage direct current (HVDC) link project.
This project aims to further enhance the sustainability of the Mumbai Grid by supplying more renewable power to the city and meeting its increasing electricity demand.
Construction work for the 80 km multi-faceted project is scheduled to commence in October of this year.
To fund this ambitious project, AESL has secured a credit facility as part of a $700 million revolving project finance facility tied up in October 2021. This facility was tied up to support the company's under-construction transmission assets portfolio.
The banking consortium for the platform infrastructure financing involves nine international banks, including DBS Bank Ltd., Intesa Sanpaolo S.p.A., Mizuho Bank Ltd., MUFG Bank Ltd., Siemens Bank GmbH, Société Générale, Standard Chartered Bank, Sumitomo Mitsui Banking Corporation, and The Hong Kong Mortgage Corporation Limited.
"This link is the need of the hour for the city and will support its growth aspirations. It showcases our commitment to offering Mumbai a brighter and greener future. The project will help accelerate the city’s decarbonization and its net zero journey,” said ASESL MD Anil Sardana, reports Economic Times.
This Platform Infrastructure Financing Framework that funds various under-construction assets offers project access to funds that another project in the portfolio has paid back. Such an effective one-time structure ensures continuous and consistent access to capital for all future projects in AESL’s transmission portfolio, the company said.
By FY25, Mumbai's electricity demand is projected to reach 5,000 MW, surpassing the current peak demand of 4,000 MW.
However, the city only has 1,800 MW of embedded generation capacity, and the existing transmission corridors face capacity constraint risks.
A significant power blackout event occurred in the entire city of Mumbai on 12 October 2020 due to grid constraints. The HVDC transmission link announced by the company will improve grid stability by connecting with both the state and national grids.
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