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I Squared Capital announces investment in Amplus Energy Solutions

According to reports, infrastructure investment manager I Squared Capital through its ISQ Global Infrastructure Fund on Monday announced its investment in Amplus Energy Solutions Pvt. Ltd.

I Squared Capital is a private equity firm focused on energy, utilities and transport in North America and Europe, and selects investments in high-growth economies. The firm, whose founders include ex-Morgan Stanley banker Gautam Bhandari, has been evaluating infrastructure projects in India.

Amplus is headed by Sanjeev Aggarwal, former director, business development, AES (India) Pvt. Ltd, the Indian subsidiary of the US energy major AES Corp. The firm is one of the significant foreign investors in the Indian power sector.

Mint reported on Monday about I Squared Capital’s plan to invest $150 million in Amplus Energy Solutions Pvt. Ltd, which sets up distributed solar power generation projects in India.

“Meeting such a goal requires substantial investment from both the public and private sectors,” said Bhandari, partner at I Squared Capital in a statement on Monday, adding, “We are proud to partner with Amplus to bring this efficient and sustainable technology to more customers in India and beyond. Amplus is setting up an office in Singapore to pursue opportunities there as well as in other Southeast Asian countries.”

Private equity firms have shown increasing interest in India’s green energy assets and experts expect more deals in the space, as the cost of renewable energy falls. Solar and wind energy are nearing grid parity—the point at which they will cost the same as power produced from traditional sources and become available on the nation’s transmission and distribution grid.

“Amplus constructs and operates distributed rooftop solar projects for industrial and commercial customers under long-term power purchase agreements. Rooftop solar power eliminates the need for costly and inefficient transmission by generating and consuming electricity within the same area,” the statement added.

The move comes amid a government push on renewable energy to the top of its energy security agenda. India needs as much as $200 billion to meet its target of installing 100 gigawatts (GW) of solar power and 60,000 megawatts (MW) of wind power by 2022. Of the planned solar capacity, 40,000MW has to come from solar rooftop projects, where Amplus operates.

“We provide construction capital, guaranteed implementation timelines as well as ongoing operations and maintenance. Our power purchase agreements offer customized tariff options lower than grid tariffs—the resulting savings can begin from day one of installation,” said Sanjeev Aggarwal, chief executive officer of Amplus in the statement.

The emphasis on solar and wind power is also expected to strengthen India’s standing at global climate change negotiations that culminate in a summit in Paris in December. In India, which is the biggest greenhouse gas emitter after the US and China, renewable energy currently accounts for 13%, or 35,777MW, of the total installed capacity of 2,74,818MW.

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