Infrastructure investor Equis plans to pump US$1 billion (S$1.34 billion) into Indian renewables in the next two years, doubling its portfolio to nearly two gigawatts of wind, solar and hydro energy installations, chief executive officer David Russell said.
"It would be our expectation to double our current position within the next 24 months," Mr Russell said in a phone interview.
Equis, a US$2.7 billion fund, has 3.6 gigawatts of combined renewable energy capacity in India, Japan, the Philippines and Thailand.
The asset developer has approved equity commitments of US$630 million to India in the last four years.
"We should be looking to invest another US$1 billion into the Indian renewable energy market and we think that's very feasible considering our position," Mr Russell said.
Equis has financed 737 megawatts of Indian renewables, with 300 megawatts under development. The company commissioned a 108- megawatt wind project in the central Indian state of Madhya Pradesh at an investment of US$131 million this month.
The majority of Equis' renewable energy projects, including those in India, have been financed with 100 per cent equity, with the company carrying out construction and development on its own, Mr Russell said.
"We are not frightened of where tariffs (in India) are going as we don't have to pay anyone a development or construction premium because we do it ourselves," Mr Russell said, adding that his returns are in double digits "between the low and mid teens".
India has competitive bidding for solar tenders, with companies vying aggressively for them and pushing down tariffs to as low as 6 US cents a kilowatt-hour in January.
In the next 24 months, Equis will aim to expand to at least five gigawatts and is looking to expand into new markets like Taiwan, Australia and Indonesia.
On average, 50 megawatts to 100 megawatts will be added to its portfolio every month this year and into the next year, Mr Russell said.
"We see these markets in Asia needing US$1.1 trillion in capital over the next 10 years in renewable energy," he said.
BLOOMBERG
