Adani Green signs 20-yr deal with Lanka to develop wind power stations

The Government of Sri Lanka has inked a 20-year deal with Indian billionaire Gautam Adani’s renewable energy arm, Adani Green Energy Limited, for the development of two wind power stations in the country, said a Cabinet statement on Tuesday.

Soon after the announcement, the price of an individual Adani Green share shot up to Rs 1,790 before subsiding at Rs 1,770 in early trade.

According to the deal with Sri Lanka, the Adani Group will invest $442 million to develop a wind power station each at Mannar town and Pooneryn village in northern Sri Lanka that would have a combined capacity of 484 megawatt, once a Sri Lankan Cabinet-appointed negotiation committee has officially assessed the project. Adani Green had already received the Sri Lankan government’s go-ahead to develop the wind power stations in February last year.

During the 20-year tenure of the agreement, Adani Green will be compensated at 8.26 cents per kilowatt-hour (kWh).

The economic crisis that has plagued Sri Lanka over the past couple of years has resulted in power and fuel scarcity, and the island nation has had to fall back heavily on importing fuel that has created pressure on the exchequer. The focus for the government of Sri Lanka right now is to accelerate renewable energy projects at home, which is where the Adani Green project is significant for the country.

Among other deals with Sri Lanka, the Adani Group entered into a tripartite, $700-million agreement with Sri Lanka Ports Authority and the Lankan conglomerate John Keells Holdings in September 2021, to jointly develop a container terminal at Colombo Port.