Azure Karnataka

completed

Azure Power India Private Limited (“Azure” or the “Sponsor”) is a leading solar project developer in the country. Currently, Azure has several operational solar plants in multiple states across India. Azure also provides Engineering, Procurement & Construction (EPC) and Operations & Maintenance (O&M) services for all its plants (both under construction and operational).Azure was awarded three contiguous solar projects of a total capacity of 130MW (the “Project”) under a 25 year Power Purchase Agreement (“PPA”) by the Karnataka Renewable Energy Development Agency (“KREDL”). The Project will be executed through three different project SPVs: Azure Power (Raj.) Private Limited (40MW), Azure Photovoltaic Private Limited (40MW) and Azure Sunrise Private Limited (50MW). The non-escalating tariffs for the 50MW, 40MW and 40MW projects are INR 6.89/unit, INR 6.93/unit and INR 6.96/unit, respectively. The PPAs have been signed with the following state distribution companies: Hubli Electricity Supply Company Limited (“HESCOM”), Chamundeshwari Electricity Supply Corporation Limited (“CESCOM”) and Gulbarga Electricity Supply Company Limited (“GESCOM”). Azure will perform the EPC and O&M services for the project. The PV technology will be thin film based solar PV Modules manufactured by First Solar Inc. The power generated from the 130 MW project shall be transmitted by a 220 kV substation at Hiriyur (SRS) located south of the project site. The transmission route length will be about 20 km running parallel to the Hiriyur Bellary Road. A feasibility study for connection to the substation and survey for the transmission route is being carried out. The company will obtain necessary approvals for setting up the towers and Right Of Way (ROW) approval for laying the transmission line. Private land required for the construction of the transmission line (either pole/tower site and/or for the line right-of-way (RoW) will be leased from individual land owners through a negotiated settlement. The load flow study is being carried out by Karnataka Power Transmission Company Limited (KPTCL). Subsequently, the company will enter into a long term agreement with KPTCL for transmission of power.The total land requirement for the 130 MW project is estimated at about 580 acres. The company has already identified the requisite land. The project company has entered into a Memorandum of Understanding (MOU) with a land aggregator on April 3, 2015. The company has registered about 180 acres of land under Azure Raj Private Limited and rest of the land purchase is under process. The company will provide EPC services internally for all three plants.The project is located near Gollahalli, Kandekeri, Kaparhalli and Jadekunte villages in Hiriyur and Challakere talukas of Chitradurga district and landuse at the site is mostly barren land. The closest village is located around 1.5 km from the project boundary. There are no big industries around the project site except a sponge iron factory located at a distance of about 500 m from the identified project site boundary near to Gollahali village. The site can be approached from Bangalore by road via NH 4 & NH 13 through Chitradurga. The site can also be approached via Hiriyur Bellary road. The nearest airport is at Bangalore at a distance of around 200 km and nearest railway station is also at Bangalore. The site is flat terrain with few undulations. About 20 km from site there are other established solar power projects in the area and a lot of wind farms are currently operational beyond 40 km from the identified location of the project. The total cost of the Project is estimated to be INR 9.5 billion (equivalent to US$147 million). The proposed IFC investment involves an IFC ‘A’ loan investment of up to INR 1,993 million A loan (equivalent to US$30.8 million) and possible syndication through IFC of up to INR 5,124 million (equivalent to US$79.1 million) for the development of three solar projects. The project is planned for commissioning by the end of June 2016.