RIL to invest Rs 75,000 cr in clean energy, build 4 giga factories: Ambani

Five years after disrupting the telecom space with the launch of Jio, Reliance Industries Ltd (RIL) on Thursday announced yet another game-changing move —  a mega entry into green energy.

The company is planning to get into solar power generation and manufacturing, hydrogen production, e-fuels, and energy storage under its “New Energy and New Materials” division.

It will also set up a platform for renewable energy project finance to source long-term global capital for investment in these sectors.

The three-pronged plan will cumulatively involve an investment of Rs 75,000 crore over three years, Mukesh Ambani, chairman, RIL, announced during its annual general meeting (AGM) on Thursday. The AGM was also addressed by his wife, Nita Ambani and his children, Akash and Isha.   

Response to the RIL stock was, however, not so enthusiastic. It was the top loser among index stocks and ended 2.35 per cent lower at Rs 2,153.35 on the BSE. Some of this decline can be attributed to the stock’s 12 per cent rise in the past one month. In comparison, the S&P BSE Sensex was up 3.3 per cent during this period.

Under the plan, RIL will set up a Dhirubhai Ambani Green Energy Giga Complex, spanning 5,000 acres, in Jamnagar, Gujarat, at Rs 60,000 crore while another Rs 15,000 crore will be invested in value chains, partnerships, and future technologies, including upstream and downstream industries.

RIL will create a capacity of producing solar power of 100 Gw in 10 years. The ambition is stunning as India’s installed capacity of solar power is now 40 Gw (including ground mounted and rooftop).

“Reliance will thus create and offer a fully integrated, end-to-end renewables energy ecosystem,” said Ambani.

The move will bring RIL into direct competition with the Adani group. Adani Solar has 3.5 Gw of annual solar photovoltaic production capacity while Adani Green Energy has a portfolio of 25 Gw of commissioned and under construction projects.

RIL will set up four giga factories for integrated solar photovoltaic modules, advanced energy storage, an electrolyser factory for green hydrogen, and a fuel cell factory for converting hydrogen into motive and stationary power.

For solar manufacturing, RIL will have integrated manufacturing starting from raw silica and poly silicon to ingot, wafers to finished products cells and modules. This will be a major addition to India’s solar manufacturing plans though the company did not reveal the capacity it would be putting up.

India imports close to 90 per cent of its solar cells and module requirements. Eighty per cent of this is from China. According to the industry data, India has 3,100 Mw of cell manufacturing capacity and 9,000 Mw of module manufacturing.

The Union government early this year announced the production-linked incentive scheme for solar photovoltaic panels manufacturing in India. The Rs 4,500 crore scheme aims at creating an additional 10 GW capacity of integrated solar PV manufacturing plants in the country.

RIL will focus in a major way on rooftop solar and decentralised solar installations in villages. The second part of the plan entails creating a value chain for the giga factories. It will be part of the Jamnagar complex of the company.

RIL’s renewable energy project management and construction division will provide end-to-end solutions for large renewable plants across the world.

Ambani said the centre would also “enable and partner with thousands of green MSME entrepreneurs, who can deploy kilowatt-to-megawatt scale solutions in agriculture, industry, residences and transportation”.

All of these three together will be part of its architecture for India’s decentralised green economy.

“With these new initiatives, Reliance will put Gujarat and India on the world solar and hydrogen map,” Ambani said in his AGM speech.