Adani Green Energy Limited (AGEL), a part of the Adani Group, has shown its dedication to renewable energy by signing a substantial 20-year power purchase agreement (PPA) with Sri Lanka to build two wind projects. A major contract for 484 MW of projects in Mannar and Pooneryn has been completed by the Sri Lankan government, which is a big deal for the country’s renewable energy sector.
Wind farms are the biggest electricity project Sri Lanka has ever undertaken, and they also represent the country’s biggest FDI. The competitive tariff that Adani Green would get for its power production is $0.0826/kWh, significantly lower than the rates paid to thermal projects by the state-owned Ceylon power Board (CEB). A total of $740 million is expected to be invested in these projects, with an extra $290 million reserved for associated infrastructure to distribute power across Sri Lanka.
Following its participation in the West Container Terminal project at Colombo Port, Adani has entered the Sri Lankan market, further demonstrating the strategic importance of the area to the company. Adani Green announced a massive expansion plan in April 2024, and it involves spending Rs 2.3 trillion ($27.6 billion) to raise its wind and solar power production capacity from 10.9 GW to 45 GW by 2030. The total budget for renewable energy projects in India is Rs 50 billion, as proposed.
An example of Adani Green’s dedication to sustainable energy is the 551 MW solar power plant that has begun operations in Khavda, Gujarat. Current output to the national grid is from the facility, and future plans call for expanding Khavda to 30 GW, making it the biggest solar park in the world.
Following widespread blackouts and fuel shortages in 2022 as a result of the country’s economic crisis, Sri Lanka enacted new laws to revamp its power sector and promote investments in renewable energy. Reducing CEB losses and making the business more accessible to investors were goals of the $2.9 billion bailout plan from the International Monetary Fund (IMF), which this step is in line with.
To fight China’s economic domination in the Indian Ocean, particularly in the northern region of Sri Lanka, which is next to India’s southern mainland, Adani’s projects are strategically important. The projects aim to increase Sri Lanka’s energy independence by meeting the annual energy demands of 600,000 households with 1,500 million units of renewable power. On top of that, they will cut emissions by 1.16 metric tonnes, create over 1,200 jobs in the area, and replace annual fossil fuel imports worth $270 million.
According to project insiders, a comprehensive Environmental Impact Assessment (EIA) was carried out by an impartial third party, and all environmental regulations were adhered to, even if there was some pushback from an anti-Indian campaign that seemed to have the backing of China and fossil fuel providers. A government Request for Proposal (RFP), technical review, and tariff discussions were all part of the open process that led to Adani being awarded the project.
Thanks to regulatory permission from the Public Utilities Commission of Sri Lanka (PUCSL) and a competitive rate, Adani’s wind projects mark a turning point in Sri Lanka’s shift to renewable energy and economic stability.
