RIL’s green push, competition between Ambani & Adani may pull solar tariffs down further

Reliance Industries (RIL) Chairman Mukesh Ambani’s $10-billion entry into renewable energy could drive solar tariffs further to the ground and ignite bidding wars with fellow billionaire Gautam Adani, according to industry analysts. 

India’s two richest men are vying to be at the forefront of Prime Minister Narendra Modi’s ambition to ramp up green energy capacity in the world’s second-most populous country by more than four-fold to 450 gw (4,50,000 mw) by 2030. 

They have mostly avoided operating in each other’s space, and the renewable energy push by Mr Ambani's flagship RIL and the Adani Group of Companies will be the highest-profile faceoff between them. 

Mr Ambani, 64, built up his family-owned petrochemical and textile business into a sprawling empire, including telecom and retail. Mr Adani, 59, is a self-made billionaire who has focused on electricity generation, transmission and distribution and the operation of ports and airports. The two billionaires – and Mr Modi – are all from the western State of Gujarat. 

Last month, Ambani had announced that he would build 100 gw in solar energy capacity over the next nine years. He had said that his group would spend $10 billion over the next three years in building solar manufacturing units, a battery factory for energy storage, a fuel cell factory and a unit to produce green hydrogen. 

Three days later, Mr Adani had announced that his green energy venture would add 5 gw every year in this decade from a current level of about 3.5 gw. 

Analysts say that there is sufficient space for multiple companies to grow as a part of India’s ambitious green energy target, but tariffs could fall further as companies try to outdo each other in aggressive bidding wars to win projects. 

Solar tariffs in India are already among the lowest in the world, having fallen below Rs 2 per kilowatt hour (kwh) in auctions conducted in Gujarat. 

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