In a landmark move, Reliance Industries Limited (RIL) and Adani Power Limited (APL) have announced their first-ever collaboration, with RIL acquiring a substantial 26% stake in a Madhya Pradesh power project owned by Adani Group. The partnership entails RIL investing Rs 50 crore in Mahan Energen Ltd (MEL), a subsidiary of Adani Power, and utilizing 500 MW of electricity generated by the project for captive use.
This historic agreement signifies a departure from the traditional narrative of rivalry between Mukesh Ambani and Gautam Adani, two titans of the Indian business realm who have predominantly operated in separate spheres. While Ambani’s interests have ranged from oil and gas to retail and telecom, Adani has focused on infrastructure, including seaports, airports, coal, and mining.
The collaboration underscores the growing significance of clean energy initiatives in India, with both companies making substantial investments in renewable energy projects. Adani aims to become the world’s largest renewable energy producer by 2030, while Reliance is spearheading the development of gigafactories for solar panels, batteries, green hydrogen, and fuel cells in Gujarat.
Reliance and adani shake hands
The specifics of the deal involve RIL acquiring five crore equity shares in MEL at a face value of Rs 10 each, amounting to Rs 50 crore. This investment grants RIL a 26% ownership stake in MEL’s captive unit, aligning with the Captive User policy outlined in the Electricity Rules, 2005.
Through this collaboration, RIL secures a long-term power purchase agreement with Adani Power, ensuring a stable supply of electricity for its operations. While the exact utilization of the 500 MW remains undisclosed, it complements RIL’s existing captive units across oil refining, petrochemical complexes, and coal-bed methane extractions.
The partnership signifies a paradigm shift in the dynamics of India’s corporate landscape, demonstrating the willingness of industry leaders to set aside rivalry for mutual benefit and contribute to the nation’s energy security. With regulatory approvals pending, the completion of this landmark deal is anticipated to herald a new era of cooperation and innovation in the energy sector, further propelling India’s march towards sustainable development.
