Shell Triples Solar, Wind Assets by Acquiring India’s Sprng Energy

Shell’s venture capital subsidiary has acquired Sprng Energy, one of India’s largest renewables platforms, thus tripling its operating wind and solar power assets.

Sprng’s first solar project, the 250-MW Arinsun Clean Energy facility in the central Indian state of Madhya Pradesh, was seed funded by Actis in 2017.
Source: Sprng Energy

Shell’s venture capital (VC) subsidiary, Shell Overseas Investment, has tripled its operating renewable assets by acquiring Sprng Energy, a renewables platform based in Pune, India. Since its startup in 2017, Sprng has fast-tracked growth in capacity to supply solar and wind power to what promises to be the world’s biggest energy consumer by 2040.

Shell announced on 9 August that its VC arm had acquired 100% of Solenergi Power Private (of which Sprng is a part) for $1.55 billion from India’s Actis Solenergi, a global private equity investor that seed-funded the venture and scaled it over 5 years to become one of India’s largest renewable energy companies.

Actis claims to be one of the world’s largest owner-operators of renewable power assets, having invested in more than 70 renewable energy projects, generating approximately 11 GW of power globally.

After having launched Sprng in 2017 with an initial asset of 330 MW peak, Actis scaled the company to where today it has more than 2.9 GW peak of assets (2.1 GW peak operating and 0.8 GW peak contracted) and a further pipeline of 7.5 GW peak in renewable energy projects, Actis reported.

After becoming a wholly owned subsidiary of Shell within Shell’s Renewables and Energy Solutions Integrated Power business, Sprng will continue to operate under its current brand, according to Shell.

In its release, Shell noted that the acquisition of Sprng’s solar and wind assets triples the international major’s current operating renewables capacity and supports Shell’s Powering Progress strategy to develop an integrated power business capable of realizing its corporate net-zero targets by 2050.

In an earlier statement regarding the transaction, issued on 29 April, Shell told investors that it expected to report half of the transaction’s $1.55 billion value as cash capital expenditure and half as debt obligations at closing. Closing is expected upon receipt of regulatory approvals later this year.

With the Indian government striving to scale up a renewable energy capacity of 450 GW by 2030, the country’s Department for Promotion of Industry and Internal Trade (DPIIT) has reported that investments in renewable energy in fiscal year 2022 hit a record $14.5 billion, a 125% increase over FY2021.

The DPIIT notes that Northern India is expected to become the country’s renewables energy hub with a potential capacity of 363 GW and public policies that promote investment in renewables.

As concerns solar power, the Paris-based International Energy Agency (IEA) predicts “explosive growth,” noting in its India Energy Outlook 2021 that solar (at the time of publication) accounted for less than 4% of the country’s electricity generation, with coal-fired power featured at nearly 70%. By 2040, however the two energy sources converge in the low 30% (Fig. 1) with the IEA attributing dramatic turn around to solar’s lower cost when compared with coal, even with the cost of battery storage factored in.

Fig. 1—Changes in share of power generation in India 2010–2040.
Source: International Energy Agency