Essar Power will invest about Rs 4,500 crore in a 300 MW renewable energy project in Andhra Pradesh, following a power purchase agreement (PPA) signed between its renewable energy arm Essar Renewables Ltd (ERL) and state-owned NHPC Ltd.
The project will deploy a combination of solar and wind power generation, supported by Battery Energy Storage Systems (BESS), to supply firm and dispatchable renewable energy, the company said in a statement.
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The agreement marks another step in Essar Power's plans to build a diversified energy portfolio of approximately 5 GW across renewable, thermal and gas-based generation.
The investment comes as India seeks to expand renewable energy capacity while addressing the challenges of intermittency and grid reliability. Firm and Dispatchable Renewable Energy (FDRE) projects combine different generation sources with energy storage to provide more predictable power supplies than standalone solar or wind installations.
"As India advances towards the vision of Viksit Bharat, building a reliable and sustainable energy ecosystem will be critical to supporting its ambitions. Essar's experience in the energy sector, combined with our focus on new technologies and emerging opportunities, gives us a strong foundation to participate in this next phase of India's energy growth," said Srinivasan Vaidyanathan, Operating Partner - Infrastructure, Essar Group.
Ankur Kumar, CEO of Essar Power, said the agreement would strengthen the company's renewable energy portfolio across solar, wind and battery storage.
"At Essar Renewables, we are focused on building a strong portfolio across solar, wind and Battery Energy Storage Systems, tapping into the growing opportunities in India's renewable energy sector. The 300 MW FDRE project with NHPC is an important milestone in this journey, strengthening our portfolio and advancing our ambition to build a scalable renewable energy business," he said.
Essar Renewables has secured three major renewable energy tenders from central public sector undertakings NHPC and SJVN, with an aggregate awarded capacity of approximately 1 GW, according to the company.
NHPC, a Navratna public sector enterprise under the Ministry of Power, is India's largest hydropower development organisation. It has expanded beyond hydropower into solar and wind energy as part of its broader renewable energy portfolio.
The project is part of Essar Power's wider strategy to balance investments in renewable energy and emerging clean energy technologies with conventional power generation.
India's growing electricity demand, particularly from industrial and urban centres, is increasing the need for generation capacity that can support both energy security and grid stability. Energy storage-backed renewable projects are expected to play a role in addressing fluctuations in solar and wind generation as the country expands its clean energy capacity.
India has set a target of achieving 500 GW of non-fossil fuel-based installed electricity capacity by 2030. The expansion of storage-integrated renewable projects is expected to be important in supporting the integration of a larger share of variable renewable power into the national grid.
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