Fortum has acquired a solar power plant in the state of Rajasthan, north-western India. The company’s short term ambition is to build a small photo-voltaic (PV) solar portfolio in order to gain experiences in different solar technologies and operating in the Indian power market.
“Solar power fits well with Fortum’s other CO2-free production and we believe it will play an important role in tomorrow’s low carbon energy system,” says Matti Kaarnakari, Managing Director, Fortum India Pvt. Ltd. “Solar power is a strong growth segment that will account for an increasing part of power generation in the future. Fast technological development is boosting competitiveness and on best markets, wholesale parity can be expected already within a few years’ time.”
The power plant’s nominal peak capacity is 5.4 megawatts and its annual production is approximately 9 gigawatt-hours. The power plant was constructed as part of the Jawaharlal Nehru National Solar Mission (JNNSM), the Indian government’s initiative for 22 gigawatts of installed solar power generation capacity by year 2022, and it has been fully operational for one year. The plant will receive a higher, guaranteed electricity price for 25 years. The period and the prices for power generation under the government’s power purchase agreement (PPA) are defined to ensure a sufficient return on investment.
“India is one of the most interesting countries for solar power development. Apart from the naturally favourable geographic location, India has ambitious plans for solar power on both national and state levels,” Mr Matti Kaarnakari continues.
In the short term, Fortum is looking to invest some tens of millions of euros – including this acquisition – in developing its PV solar competence and operations in India.