Green energy firm Serentica Renewables secures $250 million from KKR

Sterlite Power-backed firm to look at data centres, pharma cos, export industries for growth

Sterlite Power-backed Serentica Renewables, which would cater to commercial and industrial consumers, has raised $250 million from investment firm KKR in its second round of funding from the latter.

Serentica, which was launched in July last year, raised $400 million from KKR late last year from its Asia Infra Fund.

Speaking to Business Standard, Pratik Agarwal, director, Serentica, said last year’s fundraise was through straight equity with a small amount of preference capital, which was for phase one of the business. 

“Since we have signed additional contracts bringing total installed capacity to 4,000 MW, we have raised an additional $250 million. This makes the total equity agreement at $650 million from the same investor,” said Agarwal.

He added that after combining all the phases, the current capex contracted will be about $3-3.2 billion, amounting to 20-25 per cent of equity.

He said the company has tied up Rs 8,000 crore worth of contracts with equipment manufacturers and EPC contractors for solar equipment.

Agarwal is also managing director (MD) of Sterlite Power, which is a leading private power transmission company. Serentica is fully owned by Twinstar Overseas (TSOL), which also has controlling stakes in Sterlite Power Transmission and Sterlite Technologies. TSOL is a promoter entity of the Vedanta Group.

As part of its strategy to tie-up commercial and industrial customers for round-the-clock renewable power supply, the company, in March last year, signed a contract for 600 Mw (round the clock) with the Vedanta group and its three entities. Agarwal said this would entail 1,500 Mw of installed capacity.

“Last year, in aggregate, we signed an additional set of contracts and are now supplying closer to 1,600 Mw round the clock. This in unit terms is 9 billion and requires almost 4,000 Mw, including phase one,” he said.

In the first and second part of its plan, Serentica focused on the metal and mining industry. In the third phase, the company will focus more on industries such as export-focused ones, data centres and potentially pharma companies.

“We will look at companies that are keen to have high quality, stable power, and operate with 100 per cent green power. So, we were looking at those sectors. We are in an ongoing conversation, but it is at an early stage,” said Agarwal.

He said the company has not started supply. The first electricity supply is expected “in the first quarter of next financial year.” To provide round-the-clock electricity, Serentica signed an agreement with Greenko to source 1,500 Mw from its pumped storage projects.

Responding to how Serentica will provide round-the-clock green power, Agarwal said it will be a combination of multiple generation technologies and multiple generation locations. Also, it will be via use of the exchange, the National Grid and use of multiple storage technologies.