AES Saurashtra Wind Farm

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In September 2010, AES India Private Limited, through its 100% subsidiary AES Saurashtra Windfarms Private Limited (ASW), entered into an agreement with Gujarat Government, to develop a 39.2 MW wind power project at villages (Gorinja, Vachhu, Chachlana, Gaga, Jodhpar, Hadmatiya) located in Jamnagar District in coastal Saurashtra area in the state of Gujarat. The wind farm would involve the building of 49 wind turbines of 800kW capacity each. The farm was expected to have a load factor of 24.3%. The electricity generated from the project would be evacuated by the Gujarat state grid. The EPC for the power plant had been awarded to Enercon India Limited (EIL).EIL would develop, construct,commission and transfer to ASW the project at an all-inclusive price. As per the agreement signed, EIL would acquire the entire land required for the project and transfer the development rights to the company prior to commencement of operations.EIL had received all the statutory and non-statutory clearances necessary for the project. The entire power generated from Wind Energy Converter (WEC) would be stepped up to 33 kV and then transmitted to the pooling substation through the 33kV internal grid and switchyards. At the pooling substation, which will be owned, operated and maintained by EIL for the entire site, power would be further stepped up to 132 kV and transmitted to Gujarat Electricity Transmission Company Ltd. (GETCO) substation. EIL had already set up the transmission line between pooling station and GETCO’s substation. ASW had entered into O&M agreement with EIL, wherein EIL would be responsible for operating and maintaining WECs and the internal grid for a period of ten years from the Commercial Operation Date of the project. AES Saurashtra Windfarms Private Limited (Jamnagar) had entered into a 25-year Power Purchase Agreement with the state utility Gujarat Urja Vikas Nigam Limited (GUVNL), which would be effected at the time of commissioning of the project. The APPC (Average Power Purchase Cost) 20-year base feed-in tariff as per GERC (Gujarat State Regulator) tariff order of 30 Jan 2010, was US$ 0.08/Unit (INR 3.56 per unit @ 45INR/USD). The total capacity of 39.2 MW was eligible for generation-based incentive from Indian Renewable Energy Development Agency (IREDA) through GBI scheme at INR 0.50 per unit (subject to cap of INR 6.2mn per MW per annum) of power generated. UNFCC had started the validation project for Certified Emission Reductions (CERs) in early 2010. Financial closure took place on 4th January 2011.The total project cost was US$ 54.8mn (INR 2468 mn @45 INR/USD).The debt equity ratio for the project was 65/35. Financing comprised of Debt of US$ 35.6mn (INR 1604mn @ 45INR/USD) and sponsor equity of US$ 19.2mn (INR 864mn @ 45INR/USD). Debt comprised of 13year-3months Term loans from IDFC (INR 604mn), Yes Bank (INR 400mn), and Indian Renewable Energy Development Agency (IREDA, INR 600mn). The term loans had a repayment schedule of 48 quarterly instalments. IDFC Was appointed as the mandated lead arranger. Construction for the wind farm was expected to start in October 2010 and commercial operation was expected to start in June 2011.