US-based private equity firm Global Infrastructure Partners (GIP) will issue green bonds worth Rs 2,500 crore in the Indian market in the next 12-18 months. The proceeds will be used to refinance its high-cost exposure to renewable assets in Andhra Pradesh, Telangana and Punjab.
The company is looking at various options to raise equity, including roping in a partner for its 700-ME renewable energy platform Vector Green and monetising the platform in full. A banker has been appointed for the purpose, the sources said.
An additional 300 MW capacity is being added by the firm in a year, and another 1,000 MW of hybrid wind-solar projects in three years.
GIP had raised Rs 1,237 crore from Indian markets in July last year via green bonds. The fund intends to reduce its borrowing cost by 200-250 basis points from 8.5-9% with the new issuance, the sources added.
The decision is also triggered by Andhra Pradesh high court’s recent order asking discoms to honour the sanctity of power purchase agreements (PPAs). The order settled a two-year-long dispute between discoms and power generators over high tariffs from old projects that the discoms wanted to be renegotiated . Renewable capacities in excess of 4000 MW are lying under-utilised in the state for last two years.
“The proceeds of green bonds issuance will be utilised to refinance borrowings for 200 MW renewable assets in AP, Telangana, and Punjab,” a source said.
GIP, in July 2021, sold its road platform to KKR for roughly Rs 3,000 crore. KKR, the global investment firm acquired GIP’s entire interest in Highway Concessions One and seven highway assets with a total highway length of 487 kilometres.
Going ahead, the fund sees strong opportunities in power transmission, telecom towers, telecom fibre business, roads, ports and airports.