Adani Energy Solutions Limited (AESL) has achieved financial closure for its USD 1 billion Green High Voltage Direct Current (HVDC) transmission link project, a critical infrastructure initiative aimed at strengthening Mumbai’s power grid and enabling higher renewable energy integration. The company has secured a USD 700 million revolving project finance facility from a consortium of nine international banks for its under-construction transmission assets, including the HVDC link between Kudus and Aarey in Mumbai, Maharashtra.
The HVDC transmission link is expected to play a vital role in ensuring an uninterrupted and reliable electricity supply to Mumbai, a city facing growing transmission capacity constraints amid rapidly rising energy demand. Mumbai’s peak electricity demand is projected to increase to 5,000 MW by FY25 from the current 4,000 MW, while the island city has only 1,800 MW of embedded generation capacity. Existing transmission corridors are already under stress, as highlighted by the major citywide blackout on 12 October 2020. The HVDC link will enhance grid stability by providing a robust interface with the state and national grids and will enable the bulk injection of an additional 1,000 MW of renewable power into the city.
The USD 700 million credit facility forms part of a unique Platform Infrastructure Financing Framework arranged in October 2021. This structure allows access to capital for multiple under-construction projects within AESL’s transmission portfolio, using repayments from completed projects to fund new ones. The one-time framework ensures continuous and consistent access to funding for future transmission projects.
The banking consortium includes DBS Bank Ltd., Intesa Sanpaolo S.p.A., Mizuho Bank Ltd., MUFG Bank Ltd., Siemens Bank GmbH, Société Générale, Standard Chartered Bank, Sumitomo Mitsui Banking Corporation, and The Hong Kong Mortgage Corporation Limited. The facility has also been certified as a “Green Loan” by Sustainalytics, supporting the transmission of clean energy and contributing to the United Nations Sustainable Development Goals, particularly SDG 7 and SDG 9.
The HVDC technology offers significant advantages over conventional transmission systems by improving grid stability and preventing cascading failures during sudden load changes or outages. It is also the most environmentally friendly option, transmitting higher energy per square meter with lower losses. Adani Energy Solutions is the only private player in India with experience in installing HVDC transmission links, and has executed such projects in record time.
The 80-km, multi-faceted project will provide a major technological upgrade to Mumbai’s power infrastructure while addressing the complexities of executing large-scale construction in a densely populated urban environment. Construction work for the HVDC link is scheduled to begin in October 2023.
Commenting on the development, Mr. Anil Sardana, Managing Director of AESL, said the project is critical for supporting Mumbai’s growth and decarbonisation goals. He added that the HVDC link reflects the company’s commitment to delivering a brighter and greener future for the city, while also expressing appreciation to the banking partners for their continued support and confidence in AESL.
This unique financing framework is the first-of-its-kind project finance structure and has earned multiple accolades – Project Finance International’s Asia-Pacific Indian deal of the year 2021 and AAA Asset’s Most Innovative Deal of the year 2021 as well as IJ Global’s Portfolio Financing Deal of the year 202
