We are committed to lead the global low-carbon energy transition: Sterling and Wilson
- November 7, 2022
Very recently, Sterling and Wilson Renewable Energy clinched a mega EPC contract to build a 1,568-mw solar PV project for NTPC. In the backdrop of this development, T&D India got in touch with Amit Jain, Global CEO, Sterling and Wilson Renewable Energy Group, to understand the company’s green energy activities, which, in the years to come, will transcend from solar EPC to new areas like battery energy storage systems, green hydrogen, etc. Jain is confident that Sterling and Wilson Renewable Energy, as a longstanding international global EPC player, has a big opportunity to play a key role in the global low-carbon energy transition. An interview by Venugopal Pillai.
Let us start with the recently clinched NTPC-REL order that we believe is SWRE’s largest domestic order till date. What challenges do you foresee in the execution of this mega contract?
Besides being our largest order in the domestic market, NTPC REL’s 1,568 MW DC project in Kutch, Gujarat is one of the largest solar power plants coming up in the country.
We foresee some challenges on the ground conditions specifically around water logging. Given our vast industry experience, we have worked on various terrains and geographies and have attained expertise in building plants with challenging ground conditions.
This project is first of its kind where the tracker technology is being installed for such a large-scale project at one single location, and there are electrical works above ground. We are proud to have this project added to our portfolio, and to execute it we require skilled manpower. We will be mobilizing localized manpower in huge numbers and also impart training to them on various skill set so as to aid this project for on-time completion, thereby satisfying our customer. We will also be implementing various training initiatives at the project site to upskill our manpower.
Sterling and Wilson Renewable Energy (SWRE) has a total portfolio of around 12.6 GW DC (commissioned, and under various stages of execution) spread across globally. With our strong experience and execution capabilities, we are fully equipped to overcome any challenges that might occur and deliver the project thereby meeting the client’s expectations.
Incidentally, what is the largest ever order that SWRE has won, including the international market?
Our largest project till date is the 1,177 MWp single-location solar PV plant in Sweihan, Abu Dhabi, UAE. The Noor Abu Dhabi plant is a world-class solar project built with over 5 million accident-free safe manhours. This is the only plant in Middle East with an East-West configuration of modules and a unique eight high fixed structure design used to optimise power generation. 1,412 robots have been deployed, resulting in reduced water consumption and operating expenses.
What is SWRE’s current unexecuted order book and what is the share of domestic projects?
Our unexecuted order book as on September 30, 2022 stands at Rs.2,654 crore with nearly 78 per cent constituting domestic EPC, that is executable over the next 12-18 months.
How do you rate business opportunities for large-scale projects from Central PSUs like NTPC, NHPC, SJVN, etc. – all of whom have firm plans of significant green capacity addition?
India is targeting to achieve 500 GW of renewable energy capacity by the end of this decade and is poised to become the fourth largest renewable energy market by 2030. The long-term outlook for the industry remains robust with the Government’s thrust on clean energy.
Over the past year, major players, both private and public, have announced ambitious energy transition plans. However, PSUs play a key role in India’s clean energy goals. Major PSUs like NTPC, SJVN, SECI and others have all announced ambitious green energy plans and are working on aggressive targets. This opens a huge window for the industry, especially for EPC players like us. Considering the fact that due to module uncertainties, IPPs are being cautious, PSUs are taking a lead in showing the way forward with different models to overcome these commodity risks.
We at Sterling and Wilson Renewable Energy, are quite positive about these developments and are well positioned to be at the forefront of this tremendous opportunity.
Which countries dominate your current overseas order book? We understand that there are some concerns in your key North American markets – US and Canada. Could you elaborate?
Sterling and Wilson Renewable Energy has a market presence in 25 countries and projects in 18 countries. Currently, our overseas order book comprises of projects majorly in Australia, USA and Latin America.
Every market has its unique challenges and risks, but it primarily revolves around site conditions, weather conditions, availability of manpower and challenges related to the grid.
With our unparalleled global reach, strong relationships with customers and lenders, and an established project execution experience, we are confident to overcome these challenges and succeed in the delivery of projects. Specific to North America, the challenges we have faced are around labour availability as the market has some regions that are dominated by Unions.
“Today, the company has strong operations across 25 countries in India, Southeast Asia, Middle East, Africa, Europe, Australia, and the Americas.”
What is SWRE’s current global footprint in terms of countries covered? Are there some yet untapped countries/regions that hold potential?
Started in 2011, Sterling and Wilson Renewable Energy expanded into international markets in 2013 with its first order in South Africa. The company has grown strength to strength and has built projects in challenging markets such as USA, Australia, Chile, Argentina, UAE, Morocco, Egypt and Vietnam. Today, the company has strong operations across 25 countries in India, Southeast Asia, Middle East, Africa, Europe, Australia, and the Americas.
We are committed to leading the transition towards low-carbon energy globally and will continue to strengthen our business portfolio in the domestic as well as international markets, along with exploring newer geographies that are looked upon strategically. There are many untapped countries that are yet to open for renewable sector – regions like East Europe, Balkans, Sub Saharan Africa and more. We are very bullish on the European market, and with our local presence in Spain, we are hopeful to gain significant traction in the region.
Speaking of O&M, please discuss evolving technologies for efficient O&M of solar plants — robotic cleaning for instance?
Until a few years ago, solar O&M was limited only to module cleaning, plant security, optimal spares management and overall plant upkeep. As large-scale solar assets mature and plant sizes increase, asset owners are realizing the value of a strategic data-driven approach for maintenance. Timely reporting and accuracy of plant performance metrics, and plant availability is a critical requirement of the asset owners. With smart technology becoming a powerful competitive advantage, the solar O&M market is fast changing from being conventional to tech driven.
New technologies are being implemented to improve asset cycle management, remote sensing (powered by Industrial Internet of Things), cloud computing and aerial techniques for visual imaging. With the solar M&A market booming and with a drop in tariffs, digitisation is facilitating sellers finding buyers easily, and operating assets more efficiently. It also helps in reducing the manpower dependency and create better insights for improved operations. Technology-driven O&M is now a prerequisite to attracting investment into the sector and maximising Levelized Cost of Energy (LCOE) for the investor.
The need of the hour is continuous performance monitoring, trend analysis and forecasting, and predictive analytics to ensure maximum plant performance and reduce plant downtime.
Artificial intelligence (AI) and machine learning (ML) have emerged as important tech solutions in the quest for better monitoring and predictive maintenance. These technologies have the potential to analyse big data, optimise the present and forecast future trends. Market forces are also causing higher investments in R&D to make the equipment uptime more reliable. This advancement, supported by AI and ML, is leading to higher reliability on equipment life and decrease in downtime.
“We are developing our capabilities to design, supply and construct projects related to green hydrogen and battery energy storage systems.”
We understand that SWRE is diversifying into emerging areas like green hydrogen, battery-based energy storage, etc. Please discuss.
Green hydrogen is being talked about as the fuel of the future and there have been announcements of huge investments proposed in this sector. In a recent report by PWC, green hydrogen, produced through renewable resources such as solar and wind, holds significant promise in meeting the world’s future energy demands. Markets like India, Australia and MENA have large land parcels with abundant sunlight and have announced some of the most ambitious green hydrogen projects globally. This sector will be an area of exciting opportunities as the scale of these projects is huge and will benefit large global players like us.
The Battery Energy Storage System (BESS) business is expected to grow by two times in next four years to $12 billion annually. Australia, UK, and Europe will be the next big consolidated market with UK, Germany, France, Italy, and Spain being top five countries.
We believe the opportunities in these segments are huge. We are developing our capabilities to design, supply and construct projects related to green hydrogen and BESS, and have added a team of experts – design, sales, and execution – to venture into these markets.
Specifically, what role does SWRE envisage in the green hydrogen value chain?
Within the green hydrogen projects itself, you will have electrolyser manufacturers who could do the balance of plant etc., so our business model right now will be centred around executing the solar PV for these projects. If you look at some of the green hydrogen projects announced globally, they are so large, that the solar projects needed to back those will need to be huge. This is a massive market by itself, so we should not look at Sterling and Wilson Renewable Energy being a green hydrogen technology player right now, that’s not the model for us.
On the corporate side, what positive impact do you see of the equity investment of Reliance Group in SWRE?
RILs (Reliance Industries Ltd) investment in Sterling and Wilson Renewable Energy has led to the strengthening of company’s balance sheet and increased the confidence with our customers, suppliers, lenders and other stakeholders.
This acquisition by RIL is in line with their strategy of investing in operating capabilities as it gets ready to set up a global-scale integrated photovoltaic giga factory and make India a manufacturing hub for low-cost and high-efficiency solar panels. Moving forward, Sterling and Wilson Renewable Energy will benefit immensely from RIL’s new integrated vision, which will further strengthen our position as a leading solar EPC and O&M player in India and across the world. With our engineering talent, deep domain knowledge, global presence, and experience in executing complex projects globally, we will be a strategic partner in RIL’s solar value chain, helping them achieve their target of creating a clean energy portfolio.
Through this acquisition, SWRE will have access to RIL’s best practices as the two teams work in unison on renewable energy projects at the national and international levels. Also, RIL’s long years of expertise in business development will help SWRE consolidate its position in existing territories and make its mark in new geographies.
“The current geopolitical scenario has caused historic shifts in the energy world. Countries are looking for alternative energy sources.”
Please discuss the key drivers that will propel SWRE’s solar business both in India and abroad, in the medium term.
The key drivers in my view are:
Accelerating shift to clean energy: A transition to clean energy is a huge economic opportunity. India is particularly well placed to become a global leader in renewable energy sector. The low-carbon technologies could create a market worth up to $80 billion in India by 2030. Also, the global shift towards renewable energy is continuing an upward trajectory, and this shift is due to several factors like increasing power tariff, global warming, increasing dependence on foreign oil, government incentives among others, propelling the global switch to clean energy.
Being one of the leading solar EPC players across the globe, this would give us a great opportunity to play a key role in the global energy transition.
Energy security: The current geopolitical scenario has caused historic shifts in the energy world. Russia has been the biggest exporter of oil and gas and most of the countries across the globe have relied on Russia for long. With the ongoing crisis, and exports now being politically unacceptable, countries are looking for alternative energy sources. Although the shift towards clean energy has been there for a while, the Russia-Ukraine conflict, has changed the dynamics and energy security has become the top priority for most of the nations.
Technological improvements: Technological innovation has continued to help bring down the cost of some renewables. Design and manufacturing innovation, supply chain advances, and global adoption of clean energy have seen the costs fall further.
A recent report by IRENA states; while the cost of many renewable technologies continues to fall year on year, renewable energy is fast-becoming cheaper than fossil fuels. This is good news for the economy and good news for global efforts to reach net zero emissions by 2050, as we strive to keep temperatures within the Paris Agreement’s 1.5℃ climate target.
Project photographs seen in this interview show solar PV projects built by Sterling and Wilson Renewable Energy, in India and overseas.
