Hero Future in talks to sell power purchase agreements, taps investors

MUMBAI: Hero Future Energies, the Munjal family-promoted green energy producer, plans to sell 900 MW of its power purchase agreements (PPAs) and has started talks with investors such as KKR, Actis, Temasek-backed O2 Power and the UK’s CDC-owned Ayana Renewable Power, said two people aware of the development.

HSBC is advising Hero Future on the PPAs as well as other fund-raising options.

One PPA that Hero plans to sell was signed in 2018 for energy generated from a 250 MW solar project in Jodhpur, which was expected to be commissioned by this month. The 25-year PPA was signed quoting a tariff of Rs 2.53 a unit. The company has 1.3 GW of installed renewable energy capacity and another 1.5 GW under construction in both the domestic and overseas markets.


Hero Future Energies is backed by Mubadala Investment Company, the UAE sovereign wealth fund, which acquired 20% for $150 million in November, and International Finance Corporation, a wing of the World Bank that invested $125 million in the company in 2017.

“As company policy, we do not respond to market speculation,” a Hero Future spokesperson said. Evaluating potential fundraising options with asset recycling is a part of the company’s regular business activity, the spokesperson said, adding that presently there are no confirmed plans as such.

KKR and CDC spokespersons declined to comment, while mails sent to Actis and O2 did not elicit any responses.

A number of cash-strapped power producers have started terminating or selling PPAs that they won in auctions.