India Ratings and Research (Ind-Ra) has upgraded the rating from ‘IND A-/Stable’ to ‘IND A/Stable’ for the debt facilities of JSW Renew Energy Two Limited, a step-down subsidiary of JSW Energy.
JSWRE20L is implementing a 300 MW AC (429 MW DC) solar project in Thirumani, Pavagada in Karnataka. The company has signed a long-term power purchase agreement (PPA) for a tenure of 19 years with Bangalore Electricity Supply Co. Ltd (BESCOM) for the entire project capacity. The agreement caps generation at 300 MW AC and ensures a fixed tariff of INR 2.89 per kWh.
The rating upgrade reflects minimum equity infusion risk, availability of all the required major approvals, including land and connectivity letter, the presence of a long-term power purchase agreement (PPA) with BESCOM, and JSW Energy group’s experience in implementing and operating similar large solar projects.
Nevertheless, Ind-Ra stated, the rating is constrained by the inherent risks associated with under-construction renewable projects, including project execution, cost overruns, and counterparty payment delays from a state utility. Lack of an operational history for the SPV also limits the visibility into actual generation performance and cost structure.
In a separate development, JSW Energy’s leadership has announced plans to invest INR 13,000–14,000 crore to expand O2 Power’s installed capacity from 1.3 GW to 4.7 GW by June 2027. JSW Energy acquired O2 Power—a 4.7 GW renewable energy platform—for a total consideration of INR 12,468 crore.
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