Billionaire NRI Lakshmi Mittal-led ArcelorMittal will invest $600 million to develop, in partnership with Greenko Group, a 975-MW ‘round the clock’ renewable energy project in Andhra Pradesh.
The project will combine solar and wind power, and will be supported by Greenko’s hydro-pumped storage project. This will help the project to overcome the intermittent nature of wind and solar power generation. Greenko will design, construct and operate the renewable energy facilities. The entire project will be owned and funded by ArcelorMittal.
Nearly one-fourth, or 250-MW power, generated from the project, likely to be commissioned by the middle of 2024, will be purchased by ArcelorMittal-Nippon Steel (AM/NS) India, a 60:40 steelmaking joint venture between the two steel giants that had bought the erstwhile Essar Steel’s Hazira unit through the insolvency route in 2019.
AM/NS India will enter into a 25-year offtake agreement with ArcelorMittal to purchase 250 MW of renewable electricity annually from the project.
This will result in over 20% of the electricity requirement at AM/NS India’s Hazira plant coming from renewable sources, reducing carbon emissions by approximately 1.5 million tonne per year.
“This is an attractive opportunity for ArcelorMittal. We will be partnering with a highly experienced energy transition company in a project that will enable our joint venture company AM/NS India to reduce both its electricity costs and carbon emissions, as well as providing consistent, guaranteed returns for ArcelorMittal,” said ArcelorMittal CEO Aditya Mittal.