Adani Green Energy intends to invest more than $1 billion in establishing wind energy projects in Sri Lanka, marking the island nation's most significant foreign direct investment and its largest power project to date, reported PTI.
The company's proposal entails the establishment of two wind farms, one in Mannar town and the other in Pooneryn village, with a combined installed capacity of 484 megawatts. This initiative is set to receive an investment of $740 million. An additional $290 million will be allocated for power transmission infrastructure, as per sources familiar with the matter.
Sri Lanka, having grappled with severe power outages and fuel scarcities amid an economic crisis in 2022, has enacted new legislation aimed at revitalizing its power sector and enticing investments in renewable energy. This legislative move aligns with commitments under a $2.9 billion aid package from the International Monetary Fund (IMF), seeking to mitigate losses in the state-run Ceylon Electricity Board (CEB) and enhance the sector's attractiveness to investors.
Adani's proposed project assumes strategic significance, potentially curbing China's economic influence in the Indian Ocean, particularly in Sri Lanka's northern region, which lies in close proximity to India's southern mainland.
Sources disclosed that Adani's project has secured approval from the Sri Lankan cabinet, and negotiations for a power purchase agreement (PPA) are underway. Once finalized, the Indian conglomerate aims to commence work promptly, with a projected completion timeline of two years.
The tariff proposed by Adani is reportedly lower than that of the government's own wind power plant and the country's fossil fuel-based power sources.
If realized, the project is anticipated to bolster Sri Lanka's energy security while generating approximately 1,500 million units of clean, renewable energy annually, satisfying the energy requirements of approximately 0.6 million households. Moreover, it is expected to create around 1,200 local employment opportunities, significantly reduce fossil fuel imports by an estimated $270 million annually, and curtail CO2 emissions by approximately 1.06 million tonnes per annum.
