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From ports to mines, Gautam Adani wants all his businesses to go green

Adani has put 2030 as the deadline for Adani Ports and SEZ Ltd, India's largest integrated ports and logistics company, to become net carbon-neutral

Adani, Gautam Adani
Photo: Bloomberg
Shreya JaiAmritha Pillay New Delhi/Mumbai
5 min read Last Updated : Aug 07 2023 | 12:18 AM IST
On 18 July, as Gautam Adani, Chairman of his eponymous group, addressed his shareholders, he looked resilient in a finely-tailored dark suit and a printed pink tie. He took a quick look at his journey in the last three decades and said the group’s true ambitions lay ahead.

A large part of that ambition looks green. Adani devoted a precious few minutes of his 31-minute address to the group’s green businesses, saying it had the largest operational renewable energy portfolio in the country and was focused on developing the lowest-cost green electron.

However, Adani’s green ambition goes deeper than watts and dollars. The group is now realigning its resource mix to ensure the ‘greening’ of nearly all its diverse businesses -- from ports to mines.

An Adani Enterprises spokesperson did not respond to emailed questions till the time of going to print. However, chats with the group’s executives, who do not want to be named, paint a picture with a lot of green in it.

“At our ports, we do have a long-term plan to deploy green fuels and incentivise green shipping. In the short term, we are trying to induce electric mobility at our ports and reduce the use of diesel or CNG vehicles,” says an executive.

Adani has put 2030 as the deadline for Adani Ports and SEZ Ltd, India’s largest integrated ports and logistics company, to become net carbon-neutral.

The timing of this decision to go green in all its businesses is important for the Adani Group. In his AGM speech, Adani called the Hindenburg report, which came in January and led to a sharp erosion of the Adani Group’s share prices, a “deliberate and malicious attempt aimed at damaging our reputation”. Be that as it may, the group had to put a few significant plans on hold, including raising of funds.

Now, as the group gets back on track, it is inducting clean energy practices across its verticals to become more acceptable to global climate funding, funds tied to environmental-social-governance norms, and meet the criteria of its existing foreign investors.

In a trend that grew stronger during and after the Covid-19 pandemic, leading global financiers are either avoiding or altogether shunning fossil fuels. Multilateral development institutions, such as the International Finance Corporation, and leading global financiers such as BlackRock want to increase the share of ‘green’ in their loan portfolios. This is true of domestic lenders as well – the Power Finance Corporation and REC (earlier know as Rural Electrification Corporation) are prime examples of it.

“Green appears to be the new pitch for the group to gather debt-based funding," said a person from a law advisory firm.

This can’t be easy; some of Adani’s businesses pollute a lot. But the group is determined to leave no stone unturned, even if that stone is black. For the coal mines Adani owns and those it operates through the mine developer and operator (MDO) model, it is introducing a sustainable business model. An MDO is a contractor selected through competitive bidding for a fixed payment for a long term and does not get ownership rights.

“We are also interested in coal gasification, something that the Central government is pushing for. Most of our coal mine clients are inclined towards gasification. That is a business area we will pursue actively,” said a mining business executive.

Coal gasification transforms a most polluting mineral into a gaseous fuel that is easier to handle is cleaner.

The group is also trying to adopt a low-resource-intensive approach for its proposed expansions. During a call with analysts in May, Ajay Kapur, the Chief Executive Officer for Adani's cement businesses – Ambuja Cement and ACC – talked about plans to procure limestone sludge from the group’s proposed coal-to-PVC plant in Mundra, as the plant's byproduct "is as good as limestone".

In another recent pivot, Adani Energy Solutions (earlier Adani Transmission) plans to focus more on energy solutions, particularly green energy solutions, to be offered as third-party services to companies, including new-age business operators of data centres and semiconductors.

“The government is planning to award mega transmission projects that will connect green energy zones, so power transmission will be a green business for us. Additionally, smart meters and power distribution franchisees, whenever they come up for private investment, will be slotted under energy transition,” said one of the executives.

Adani Green Energy Ltd (AGEL) put its green hydrogen plans on hold after the Hindenburg report. It also slowed down its spree of acquisitions. But it is not lying low. Sources say AGEL is focusing on pump storage – a large-scale method of storing energy that works like a conventional hydroelectric station but uses the same water over and over again. This at a time the Centre plans to award mega-scale pump storage projects.

Is all this enough for a group that owns one of the largest portfolios of thermal power plants and coal mines? Can this dash of green wash away the tag of a net carbon emitter?

Adani said at the AGM the group’s integrated resource management increased by 37 per cent to 88 million tonne. IRM constitutes all the mines and minerals handled by the company on a contractual basis. Company executives insist the green energy expansion of the group will balance, and surpass, its fossil fuel growth.

The details, safe to say, are part of the ambitions that lie ahead.


Solar Manufacturing

4.0 Gw capacity operational Wind Manufacturing

Commercial production to start from August 23 Ingot & Wafer Manufacturing

Financial closure achieved Rewenable Energy Generation

8,316 Mw operational Green Hydrogen

At development stage

Status Gw: Gigawatt, Mw: Megawatt

Source: Company presentation

Topics :Adani GroupGautam AdaniGreen Infrastructure

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