India's renewable energy sector is set to receive a boost as Brookfield, a prominent Canadian investor, has committed to investing $1 billion in multiple tranches in Avaada Ventures, the holding company of renewable energy project developer Avaada Energy. The investment will enable Avaada Ventures to expand its renewable energy portfolio and venture into new areas such as module manufacturing and green ammonia production.
Brookfield has already released the first tranche of $400 million, and the remaining investment will depend on specific milestones being met. By 2030, the investment will be used to establish 5 gigawatts of module manufacturing capacity and double the yearly production to 10 gigawatts. Avaada Ventures has already commissioned around 3 gigawatts of renewable energy capacity and is constructing an additional 1.5 gigawatts of capacity.
Avaada Ventures has signed a memorandum of understanding with the Department of Industries and Commerce in Rajasthan to invest Rs 400 billion in a facility for renewable energy and green ammonia production. This facility will help increase the state's renewable energy capacity and reduce carbon emissions.
Foreign investors are showing a keen interest in Indian renewable energy companies, given India's favorable policies and incentives for renewable energy and ambitious capacity addition goals. The Indian government aims to achieve 450 gigawatts of renewable energy capacity by 2030, with 175 gigawatts coming from solar energy. Avaada Ventures' investment aligns with this trend.
Green ammonia is expected to play a significant role in the energy transition, and Avaada Ventures is also focusing on its production. Green ammonia is produced using renewable energy to split water into hydrogen and oxygen, which is then combined with nitrogen to form ammonia. This process does not produce carbon emissions and can be used as a fuel in power plants and transportation.
Apart from Brookfield, Thai utility PTT may also invest $300 million in Avaada Energy, a subsidiary of Avaada Ventures focused on developing solar power projects. The investment by foreign investors will help Avaada Ventures achieve its ambitious capacity addition targets and reduce its dependence on fossil fuels.
The investment by Brookfield and other foreign investors in Avaada Ventures will significantly benefit India's renewable energy sector. The investment will enable the sector to achieve its ambitious capacity addition targets, reduce its dependence on fossil fuels, and increase the production of green ammonia. With attractive policies and incentives for renewable energy, India is set to become a leading destination for foreign investors looking to invest in renewable energy companies.
