Que: How LNJ Bhilwara Group has transformed its business starting from textile to entering into the power sector?

Ans: The glorious journey of the LNJ Bhilwara Group began in 1960, when the Group’s founder, Mr. L. N. Jhunjhunwala, founded a textile factory in Bhilwara, Rajasthan, marking the commencement of the Group’s unwavering success and wealth. After more than 60 years, the Group has expanded from a single textile mill to numerous plants; it has strategically diversified and is proud to be a multi-products and services conglomerate.

Understanding the importance of clean energy, we came up with the idea of Bhilwara Energy Limited in 2006 with a vision to create a green and sustainable future. Thus, we commissioned two hydropower plants in Himachal Pradesh and a couple of wind power projects in other parts of the country. Today, these initiatives are helping us generate green and clean energy, which is later used in our textile factories. We are constantly looking for methods that help us improve our efforts in creating a healthier environment.

Que: Kindly tell Energetica India readers about Bhilwara Energy Limited, its year of formation, stakeholdings, etc.

Ans: Bhilwara Energy Limited (BEL) focuses on diversification of the Group’s portfolio in the power business since its inception in 2006, generating power through hydro and wind. The company endeavors to develop or acquire new greenfield power projects in states such as Himachal Pradesh, Uttarakhand, Sikkim, Madhya Pradesh, Chhattisgarh and Arunachal Pradesh.

Bhilwara Energy Limited holds a 51 per cent equity stake in Malana Power Company Limited (MPCL), Kullu, a joint venture with Statkraft, Norway. Thereby, it holds 44.88 per cent holding of AD Hydro Power Limited, Manali indirectly, since MPCL holds an 88 per cent stake in ADHPL.

Que: Regions where Bhilwara Energy has its projects across India or overseas? As of now, how much capacity has been installed or is under work-in-progress?

Ans: Bhilwara Energy Limited, a part of the $1 billion LNJ Bhilwara Group, is the flagship entity for the development and operation of Energy businesses in India and abroad. Through our JV entity, Indo Canadian Consultancy Services Ltd., we have expertise in Power Project Consultancy with cumulative project experience of over 5000 MW in Hydro-power plants.

Bhilwara Energy Limited has successfully commissioned 2 Hydro Electricity Projects with an aggregate capacity of 278 MW and has commissioned two wind power projects aggregating 34 MW.

Que: Shed some light on the company’s initiatives contributing towards a greener environment?

Ans: Over a period of time, Bhilwara Energy Limited has developed some of the best practices by nurturing sustainability and safeguarding the environment. With the Hydro Electricity Projects and wind power projects that the company commissioned, the average annual GHG emission reduction of the group stands at 8,00,000 (tCO2e). Besides, the group generates more than 1,200 million units of clean energy annually.

Que: Who are the various project partners & associates of Bhilwara Energy?

Ans: We have international partners such as SN Power, AECOM (previously RSW, Inc.), and IFC, Washington. We have also formed strategic partnerships with globally reputed companies and development funds such as Statkraft, a leading hydropower firm and Europe’s largest renewable energy generator that has a stake in our Hydro projects.

Que: In your view, what are the major bottlenecks in the power sector?

Ans: Efficient and reliable power infrastructure is one of the most important requisites for sustainable and inclusive economic growth in the country. As the GDP of a country grows, so will the demand for power. The two largest challenges facing the
Indian power sector are fuel supply uncertainty and deteriorating distribution company finances. Considering the dominance of coal in India’s fuel mix, its shortage can severely impede investments in the generation segment. Importing coal is not a viable long-term option as the major exporting countries are increasingly adopting energy security and resource nationalism-related policies. The need of the hour is to identify and implement solutions with utmost urgency.

Moreover, instead of taking populist measures, the state governments should focus on improving the overall management of the power sector by reducing power theft, checking leakages, penalizing big defaulters, and improving metering and energy efficiency. It is important to stem the trend of tariff cuts in order to ensure that power sector reforms are not derailed. Also, investments in capacity building and modernization are key requisites for improving sector health.

Que: What will be your key suggestions to the policymakers in order to boost the renewable energy sector in the country?

Ans: The primary objective for deploying renewable energy in India is to advance economic development, improve energy security, and access to energy, and mitigate climate change. Sustainable development is possible by using sustainable energy and by ensuring access to affordable, reliable, and modern energy for citizens. Strong government support and the increasingly opportune economic situation have pushed India to be one of the top leaders in the world’s most attractive renewable energy markets.

Even though India has achieved fast and remarkable economic growth, energy is still scarce. Strong economic growth in India is escalating the demand for energy, and more energy sources are required to cover this demand. At the same time, due to the increasing population and environmental deterioration, the country faces the challenge of sustainable development.

In order to promote renewable energy in India, policymakers should incentivize private players who are actively contributing to this space. We also need to set short-term goals for retiring fossil plants and establishing policies that lay the foundation for renewable energy.

Furthermore, there are a bunch of several general (not necessarily specific to energy) policies that facilitate renewable energy investment. These include tax policy (such as not withholding taxes on profits, and no VAT on clean power sales), allowing foreign direct investment, improved permitting processes, and foreign currency/ability to repatriate profits.

Lastly, several successful projects have included an early sponsor that was willing to assume various risks. Once certain risks in the project have been ameliorated, the sponsor should be able to attract additional or less expensive capital.