NIIF, Eversource acquire stake in UK-backed Indian renewables platform

Both companies and UK development finance institution CDC will jointly invest $330 million in Ayana Renewable Power.

India’s National Investment and Infrastructure Fund and EverSource Capital, a joint venture between Everstone Capital and Lightsource BP, have acquired a stake in Ayana Renewable Power, an Indian renewables platform created by UK development finance institution CDC Group in early 2018.

EverSource Capital, NIIF and CDC will be investing a total of $330 million in Ayana, CDC said in a statement, but did not specify the amount of capital each party will be investing nor the ownership interest NIIF and EverSource will be acquiring in Ayana.

“Ayana is pursuing greenfield and brownfield projects which will generate above market equity returns due to the financial and operational value addition brought by the partners,” Dhanpal Jhaveri, managing partner of Everstone Capital and chief executive of EverSource Capital, told Infrastructure Investor.

“The [Indian] government aims to triple its renewable energy capacity to 175GW by 2022 which is creating opportunities across the entire value chain,” he added.

Similarly, a spokesman for NIIF told Infrastructure Investor that the renewables sector in India “has seen strong traction underpinned by healthy capacity additions with globally competitive tariffs.”

On the other hand, Chris Chijiutomi, head of infrastructure equity at CDC Group, stressed that Ayana will still have a focus on pursuing sustainable investments in India. “CDC focuses on supporting economic development and prosperity in our markets, Ayana will largely focus on greenfield opportunities, and opportunistically will look at brownfield assets that fit our strategy,” he said.

Chijiutomi said that the expertise gained in India will help the company to grow its exposure in South Asia, in countries such as Bangladesh, Nepal, Myanmar and Sri Lanka.  “We already have a renewable investment in Pakistan,” he added.

India is aiming to increase the share of renewables in its energy mix to 40 percent by 2030. According to Indian consultancy Bridge to India, the country is expected to add up to 15.8GW of green energy to its power capacity this year, mainly through solar PV installations, representing “a sharp jump of 50 percent over 2018”.

NIIF will be deploying its investment through its Master Fund strategy, while EverSource Capital will be investing through its Green Growth Equity Fund. NIIF and the UK’s Department for International Development are anchor investors in GGEF, a $700 million vehicle launched in November 2016 by the Indian and UK governments to target India’s renewables sector. EverSource Capital was appointed fund manager of GGEF in April 2018.

“CDC, NIIF, and EverSource Capital bring complementary strengths of strong parentage, access to low-cost capital, [and a] track record of building rapidly scalable businesses in India and in the renewable sector with the highest standards of corporate governance backing a high-quality professional management team,” EverSource Capital’s Jhaveri said.

Ayana has so far secured two 250MW solar projects in the state of Andhra Pradesh. The company is led by Shivanand Nimbargi, who was appointed managing director and chief executive in January 2018. Before joining Ayana, he served in a similar role at Green Infra, one of India’s largest renewable energy companies.