Reliance New Energy Limited (RNEL), the clean energy subsidiary of Reliance Industries Limited (RIL), is one of India’s leading conglomerates. The clean energy arm of Reliance has made significant strides in the renewable energy sector. The company has been actively expanding its presence in the renewable energy space, demonstrating its strong commitment to clean energy. It has set ambitious targets for the development of a sizeable green energy portfolio. It also aims to achieve net zero carbon emissions by 2035. With an investment of over Rs 750 billion, RNEL is working on creating India’s most comprehensive ecosystem for “New Energy and New Materials” for a sustainable future.
The company is actively working on establishing the Dhirubhai Ambani Green Energy Giga Complex, a vast project spanning over 5,000 acres in Jamnagar, Gujarat. The complex will be one of the largest such integrated renewable energy manufacturing facilities in the world. It is in proximity to two refineries and a petrochemical facility. The complex will have four gigafactories – an integrated solar PV module factory, an energy storage battery factory, an electrolyser factory for green hydrogen production, and a fuel cell factory for converting hydrogen into motive and stationary power. With an investment of Rs 600 billion, the company is committed to constructing state-of-the-art facilities to manufacture and integrate critical components for its new energy ecosystem.
The complex will carry out manufacturing of basic raw and auxiliary materials along with research and development facilities for its new energy technology ecosystem. In order to foster collaboration and empower thousands of green micro, small and medium enterprises (MSMEs), the company’s Renewable Energy Project Management and Construction Division has decided to collaborate with MSMEs to deliver megawatt-scale solutions in the agricultural, industry, residential and transportation sectors. The company is also actively involved in the bioenergy segment and inaugurated Phase I of its Bio-Energy Technology Centre in Jamnagar in August 2022.
To keep up with the latest developments and leverage opportunities, the company has established the Reliance New Energy Council (NEC). According to the company, NEC members will help in validating strategies and shaping a roadmap to achieve the company’s net zero targets. NEC members provide guidance on technical strategies, identify opportunities and advise the company on partnerships with stakeholders worldwide. These NEC members include global advocates and thought leaders in the clean energy segment.
Solar power
Solar power is one of the primary focus areas for Reliance in the renewable energy sector. The company aims to become a major player in India’s solar energy sector and has launched various projects in this regard. Leveraging its project execution and operational efficiency capabilities, Reliance aims to build large-scale solar power plants around the country. The company plans to establish 20 GW of solar capacity by the end of 2025.
In March 2023, Reliance announced its plans to establish a 10 GW solar energy project in Andhra Pradesh. In the same month, the government allocated 39,600 MW of domestic solar PV module manufacturing capacity to 11 companies, with a total outlay of Rs 140 billion under the production-linked incentive (PLI) scheme for high efficiency solar PV modules (Tranche II). Among these companies, Reliance secured a manufacturing capacity of 6,000 MW under PLI (Tranche II). This win will further facilitate the expansion of Reliance’s solar power portfolio.
In addition, the company has undertaken significant investments and acquisitions in the solar industry. In September 2022, Reliance signed definitive agreements to obtain a significant stake in SenseHawk for a total transaction value of $32 million. SenseHawk is a California-based early-stage developer of software-based management solutions for the solar energy generation industry. In the same month, RNEL signed definitive agreements to invest in California-based Caelux Corporation. The agreement entails collaboration between the two companies on the development of perovskite-based solar technology.
Prior to this, in August 2022, RNEL invested $29 million in Germany’s NexWafe and collaborated with it to produce and commercialise high efficiency monocrystalline green solar wafers. Also, Reliance New Energy Solar acquired 100 per cent shareholding in the REC Group, a PV module manufacturer. These collaborations and acquisitions undertaken by Reliance will help strengthen its position in the solar power manufacturing and technology space.
Green hydrogen
The company has also started expanding its investments in the green hydrogen segment. It plans to invest Rs 5.95 trillion in Gujarat over the next 10-15 years for green energy and other related initiatives. The funding will help in the creation of a 100 GW renewable energy power plant and a green hydrogen ecosystem. Reliance is also committed to creating an ecosystem for small and medium enterprises, promoting the adoption of new technologies that support the captive use of renewable energy and green hydrogen.
In February 2023, Olectra Greentech introduced a hydrogen bus developed in technical collaboration with Reliance to commercialise the carbon-free alternative to traditional public transportation. In the same month, Reliance and Ashok Leyland showcased India’s first heavy duty vehicle driven by a hydrogen internal combustion engine (H2-ICE) at the India Energy Week 2023 in Bengaluru. The heavy duty truck has been tested since August 2022. The Ashok Leyland H2-ICE truck line is powered by hydrogen, yet the overall architecture is comparable to that of a traditional diesel-based combustion engine. The H2-ICE truck has a loading capacity of 19-35 tonnes. It will facilitate the transition to green energy at a lower cost. The company has also signed an agreement with Denmark-based Stiesdal A/S for the production of Stiesdal hydrogen electrolysers in India. All these initiatives are aimed at increasing the company’s green hydrogen market share in the country.
Battery systems
Reliance is engaged in the development of energy storage systems, which play a crucial role in the integration of renewable energy into the grid. The company aims to leverage advanced battery technology to develop scalable energy storage systems. As per a company notification, Reliance plans to begin battery pack manufacturing in 2023 and scale up to a fully integrated 5 GWh annual cell-to-pack manufacturing plant by 2024. By 2027, the company plans to increase its annual capacity to 50 GWh. In October 2022, Reliance signed an MoU with Ambri, a US-based start-up, for the delivery of its liquid-metal battery pilot systems. The MoU aims to enhance the strategic partnership between the two companies, and develop and manufacture Ambri’s batteries in India.
In March 2022, RNEL signed definitive agreements to acquire all the assets of Lithium Werks BV for a total transaction value of $61 million, including funding for future growth. Lithium Werks is a provider of cobalt-free and high performance lithium iron phosphate batteries. In the same month, the Ministry of Heavy Industries notified that Reliance New Energy Solar Limited has been allocated a capacity of 5 GWh with a waitlisted capacity of 15 GWh. This win will help expand the company’s battery manufacturing business.
Outlook
Reliance is a new entrant in India’s renewable energy business, previously focused on conventional energy. In a short span of time, the company has established its presence across diverse segments in the renewables space, ranging from solar power to green hydrogen, energy storage and even biofuels. This diversification, which is currently at an early stage, will help the company ensure steady growth across multiple segments instead of relying on one segment.
The company is pursuing both organic growth and acquisitions to expand its renewable energy portfolio. Its upcoming large-scale manufacturing facilities will secure its supply chains for the future. Moreover, India’s renewable energy industry, including solar and energy storage, is dependent on imports to meet the demand for solar cells and batteries. Thus, the company’s strategic decision to focus on setting up large manufacturing capacities for these components provides it with a significant edge over other players in the market. By adding electrolyser and fuel cell manufacturing to its operations, which is expected to witness significant demand in the near future, the company is expected to emerge as a major supplier of critical equipment in the clean energy space.
Net, net, despite entering the renewable energy sector relatively late, Reliance is well positioned to emerge as a prominent market player in the near future.