India’s MSP Steel and Power Limited (MSPL) has inked an agreement with Elevate Solar Energy Private Limited (ESEPL) to source solar power for 25 years, a company statement said on Friday, June 19.
Under the agreement, ESPL will supply 10 MWp (megawatt peak) of solar electricity per annum, at a fixed price, from a solar project being developed by the latter in the central Indian state of Chhattisgarh, the statement said.
The long-term arrangement is aimed at increasing MSP Steel’s renewable energy consumption while providing greater certainty over electricity costs. For energy-intensive industries such as steel manufacturing, power costs constitute a significant component of operating expenditure, making long-term renewable energy procurement an increasingly attractive option, it said.
The agreement has been structured under the ‘Group Captive’ model. As part of the arrangement, MSPL will acquire a 26 percent equity stake in ESEPL, corresponding to its contracted energy requirement. The proposed shareholding will be formalized through a shareholders’ agreement to be executed separately.
MSPL’s business verticals include manufacturing facilities for rebar, structural steel, sponge iron, pellets and ferroalloys.
