Introduction to the Acquisition

In a strategic move that underscores the growing demand for coal-fired power in India, Jindal Power and Sev.en Global Investments are engaged in a competitive bid to acquire the 1,320-MW Jhajjar thermal power project from Apraava Energy. This high-stakes acquisition reflects not only the increasing importance of thermal power in meeting energy demands but also highlights the evolving landscape of India's energy sector.

Overview of the Jhajjar Thermal Power Project

The Jhajjar thermal power project, located in Haryana's Jhajjar district, has been operational since 2012. It is notable for being the first plant in the National Capital Region (NCR) to implement flue gas desulphurisation (FGD) technology, which significantly reduces air pollution by controlling sulfur dioxide emissions. The plant supplies 90% of its power to Haryana and the remaining to Tata Power Trading Company.

Key Features of the Project:

• Capacity: 1,320 MW
• Location: Jhajjar, Haryana
• Operational Since: 2012
• Emissions Control: Equipped with FGD technology
• Power Distribution: Primarily to Haryana and Tata Power Trading Company

Bidders and Their Profiles

Jindal Power

Jindal Power, part of the Naveen Jindal Group, operates a substantial portfolio of thermal power stations. It currently manages over 4,300 MW of thermal power capacity across locations like Tamnar in Chhattisgarh, Shirpur in Maharashtra, and Simhapuri in Andhra Pradesh. The group is aggressively expanding its renewable energy capabilities, aiming for 12 GW of renewable power capacity along with green hydrogen production and storage facilities by 2030.

Sev.en Global Investments

Sev.en Global, owned by the Tykac family, is a prominent investment group with a focus on thermal power plants globally. It oversees a significant installed generation capacity of 5.8 GW and mines 10 million tonnes of coal annually. Its global reach spans across four continents, with recent strategic acquisitions like the Mong Duong 2 coal-fired power plant in Vietnam.

The Acquisition Landscape

The acquisition of Apraava Energy's thermal project is part of a broader trend in India's energy sector, where companies are diversifying their portfolios to balance fossil fuel-based power generation with renewable energy investments. Apraava Energy itself is undergoing a transformation, focusing on low-carbon growth areas.

Other companies, including JSW Power, NTPC, and several global infrastructure funds, initially explored this deal but opted out. The sale process is advised by HSBC and Axis Capital, with the asset expected to be valued at approximately Rs 4,000 crore.

Implications for the Energy Sector

Trends and Challenges

• Renewable vs. Thermal: Despite a global shift towards renewable energy, thermal power remains crucial for meeting baseload demands. This acquisition highlights the continued relevance of coal-fired plants in India.
• Environmental Considerations: The implementation of FGD technology at the Jhajjar plant underscores the industry's efforts to reduce environmental impact.
• Diversification Strategies: Companies are increasingly diversifying their portfolios to include both thermal and renewable energy sources.

Future Outlook

As companies like Jindal Power and Sev.en Global Investments vie for thermal projects, it signifies a strategic move to maintain a strong foothold in the power generation sector. Meanwhile, Apraava Energy's focus on low-carbon growth aligns with India's broader ambitions to meet renewable energy targets.

Conclusion

The race to acquire Apraava's Jhajjar thermal power project reflects the dynamic and evolving nature of India's energy sector. As demand for reliable power sources continues to grow, investments in both thermal and renewable energy will play critical roles in shaping the country's energy future.