$930 Million Investment into Indian Solar PV

The Japan SoftBank Group Corporation in conjunction with GCL System Integration Technology, a Chinese-based company is set to unveil a $930 million joint solar power investment which forms part of its broader solar venture roadmap into Indian solar.

The new Indian solar venture focuses on photovoltaic technology usually integrated in solar panels. In the deal, GCL will offer advanced technology while SoftBank will secure land and other regulatory approvals, as noted by GCL in their recent filing to the Shenzhen stock exchange.

In 2015, SoftBank hinted of a possible partnership with Bharti Enterprises and Foxconn Technology that would see them pump a whole $20 billion in Indian solar energy projects that would deliver up to 20 gigawatts (GW) in capacity.

Indian Solar Target

India has a target of achieving solar energy capacity of 100GW by 2022; a volume that is five times more than the current levels under Narendra Modi, the Prime Minister for renewable energy plan.

India’s ambitious plan hopes to generate 175GW by 2022 through a mix of renewables including solar, small hydro, wind and biomass. But this would not be without challenges.

According to a recent study, India requires a minimum of $125 billion to finance its renewables plan poised to improve the percentage of renewable energy generation by 2022, which could prove to be a hard nut to crack given the dwindling tariffs.

SoftBank, which boasts a 750MW solar capacity of installed and ongoing projects, quoted very low tariffs of 2.45 rupees per unit during the May 2017 bids.

Last month, the chief of the International Renewable Energy Agency challenged India to enhance its electricity grids and formulate a clear policy framework to help slash the cost of capital investment.

Investment Roadmap

GCL and SoftBank’s latest venture will generate a total capacity of 4GW and will be executed in two 2GW stages.

GCL will acquire 40 per cent of the business shares and 60 per cent will be owned by the Japanese firm.

The Indian solar project’s funding will be provided by SoftBank’s Vision Fund which consists of Apple Inc, Saud Arabia, and Foxconn’s wealth reserves among other backers.

In May last year, the fund had raised more than $93 billion, making it the biggest private equity fund worldwide.

The fund also has plans to set up the largest solar energy project in the world in Saudi Arabia, a project likely to gobble up to $200 billion and produce a capacity of about 200GW by 2030.

GCL shares increased 4.7 per cent, after climbing nearly 6 per cent to their highest price since December last year.

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