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IMFA Enters Agreement with JSW Green Energy for Hybrid Renewable Power Supply
Team Finance Saathi
17/Dec/2024
What's Covered Under the Article:
- IMFA has signed a binding term sheet with JSW Green Energy for a 70 MW hybrid renewable power supply agreement.
- The contract includes a solar capacity of 50 MW and a wind capacity of 100 MW.
- The deal is set to be completed by June 2026 and involves an investment of INR 83.26 crore.
Indian Metals & Ferro Alloys Limited (IMFA), a prominent company in the Indian industrial sector, has recently entered into a binding term sheet with JSW Green Energy One Ltd. (for solar energy) and JSW Green Energy Seven Ltd. (for wind energy). This agreement, finalized on December 17, 2024, involves the supply of hybrid renewable power, totaling 70 MW of contracted demand, with a specific breakdown of 50 MW AC of solar energy and 100 MW of wind energy.
Key Terms of the Agreement
The hybrid power supply will be structured under the Captive Consumer model as per the provisions of the Electricity Act, 2003 and the Electricity Rules, 2005. This deal is significant as it aligns with IMFA's goals to adopt sustainable energy sources for its operations, reducing dependence on conventional power sources and ensuring a more environmentally responsible future.
Investment and Timeline
The total consideration for this agreement is approximately INR 83.26 crore, which will be paid in one or more tranches. The project is set to be completed by June 2026, and IMFA will be securing 26% of the power supply from the renewable energy producers. This contract is expected to have a substantial impact on the company's energy needs and aligns with India's growing focus on renewable energy sources.
Regulatory Compliance and SEBI Disclosure
In accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, IMFA has provided the necessary disclosures regarding this agreement. The company also complied with the SEBI Circular No. SEBI/HO/CFD/CFD-PoD1/P/CIR/2023/123 issued on July 13, 2023, and the SEBI/HO/CFD/PoD2/CIR/P/0155 dated November 11, 2024.
JSW Green Energy Companies
JSW Green Energy One Ltd. and JSW Green Energy Seven Ltd. were incorporated recently in 2024—on April 10 and June 21, respectively. These companies focus on building, developing, generating, and supplying renewable energy, utilizing both solar and wind energy technologies. As of now, their financials are not yet applicable since their operations are still in the early stages.
Impact of the Agreement on IMFA
This partnership allows IMFA to diversify its energy sources, ensuring a sustainable and cost-effective supply of power. By securing renewable energy from a reliable source, the company strengthens its commitment to environmental sustainability and reducing carbon emissions, aligning with global and national trends towards greener practices.
The agreement also highlights IMFA's strategic approach to long-term power procurement and commitment to India’s energy transition, offering a glimpse into future collaborations within the renewable energy space.