Deal typeBuy and build
India: The renewable energy capital of the world?
With frequent energy shortages and environmental regulations to comply with, India is an attractive market for renewable energy. Low cost development, a preferential tariff regime and power shortages mean that renewable energy is becoming a critical part of the energy generation mix, making India the fifth largest wind market and one of the fastest growing solar market in the world. Demand for power is forecast to grow at 5%-7% pa over the next decade as the economy grows and industrial growth revives.
Against this backdrop, in August 2014, Actis committed $280m to establish a wholly-owned Indian renewable energy platform, Ostro Energy (Ostro). Ostro is targeting 1000MW of renewable energy capacity across several Indian states by 2019. It follows the same model as Chile’s Aela Energía, Brazil’s Atlantic Energias Renováveis and Mexico’s Zuma Energía - building renewable generation platforms on a buy-and-build thesis - an example of Actis as an ambitious, credible energy investor doing what it knows best: replicable deals in high growth sectors meeting increasing demand for domestic infrastructure.
Ostro Energy currently has 234MW Wind Projects operational across two states in India. With another 350MW of wind and solar capacity under construction, Ostro is well on its way to achieving its target by 2019. With these projects comes an opportunity to positively impact local communities. Ostro’s first project Tejuva, for example, is located in a rural area where villagers have limited access to water, healthcare and primary education. The Tejuva development team is implementing suitable programmes to address these needs of the local communities.
In 2018 Actis announced the sale of Ostro Energy Private Limited to Renew Power, one of India’s leading clean energy Independent Power Producers.