New Delhi: Singapore-based global investment firm Mount Row Partners has drawn up a huge plan to set up 1,000 Megawatt clean energy generation capacity in India, setting up small projects that can convert waste material into energy across states in phases, requiring investment to the tune of $2 billion over years.
The company — which already manages a portfolio of around $1 billion worth of investment in assets — is betting big on “biodigestion” technology and the huge potential for waste-to-energy conversion in India. The idea is to set up small projects of 5-10 MW capacity each, and the first phase starts with Maharashtra where it is investing $150-200 million building ten such facilities based on Municipal Solid Waste.
“The opportunity that exists for us and for this technology in India is huge. We have set an interim goal of setting up around 1 GW capacity including projects of 5-10 MW capacity. So, that would be around 100-200 projects that we would like to build,” Co-founder and Director Geoff Pollard told ETEnergyworld in an exclusive interaction.
THE INDIA PLAN
Depending on a number of factors which tend to be local, these projects can be built in a timeframe that ranges between six months, if everything is in place smoothly, and a year. “So, we are entering into a programme for 5 years to build 100-200 plants in India. That is a big task but it is achievable,” Pollard said.
Register NowAs a first step, the company wants to build ten facilities in Maharashtra, focused primarily on municipal waste, around Mumbai. As compared to big infrastructure projects, these waste-to-energy plants are relatively simple to build, but the secret sauce lies in the enzymes and the chemistry involved and how it is optimised for the particular waste strain being used.
Mount Row had signed an MoU with Maharashtra government recently and has now started the process of identifying the sites for the first ten projects. Once the sites are identified, it will go through the process of analysing the waste strain and understanding the right sorting process. “After that, we will work with our technology specialists to determine the exact plant design. From then on, it is a relatively short process stepping into construction. We are setting up ten plants of 5-10 MW capacity, taking the total to 50-100 MW capacity to start with,” Pollard said.
He added that the investment across the ten plants would be in the range of $150-200 million. The company typically operates with its investment funds. It has used its own capital for this project, and has taken strategic investments in the underlying technology companies.
“We work with several capital partners. Their main catchment area tends to be South East Asia. We have good capital connections in India and we have had very strong interests from investment groups. We have also had strong interest from the Middle East and our capital connections there are very keen on supporting this project,” he said.
Once the land is ready and all the other key requirements, like permits etc, are in place, the construction phase would last for around 6-12 months. The ten plants are expected to be constructed over the next two-and-a-half years.
Mount Row is now exploring a similar relationship with Andhra Pradesh, and plans to activate that plan soon in the same way as Maharashtra. In fact, it will run some of the projects in parallel in the two states.
“We have spoken to a number of other Indian state governments. We are trying to strike a balance between keeping our focus on Maharashtra followed by Andhra Pradesh and not trying to spread ourselves too thin. But the idea would be to duplicate what we are doing in Maharashtra 5-6 times. That is what will get us to our initial target of 1 GW capacity,” Pollard said.
Overall, the company is likely to spend around $2 billion in setting up 1 GW capacity projects over the next 5-10 years. “We will spend the first half of that over the first 2-3 years just on our plans in Maharashtra and Andhra Pradesh. Once the construction phase is over, these projects last for 30 years or more with very stable and predictable revenue cash flow streams,” according to Pollard.
The firm believes this is an attractive proposition for traditional financiers because of the cash flows and also because of the nature of the assets. It has already received interest from traditional finance groups as well to provide debt financing for the growth plan.
THE BUSINESS OF WASTE
For Mount Row, India is a market with huge potential and therefore it presents an exciting opportunity for growth. The biodigestion technology processes waste material where the input is organic matter which can be anything from wood chips to municipal waste or agricultural waste etc. Anything that has an organic component can be processed using this technology.
Pollard claims the technology is able to extract 2-4 times as much energy from the same piece of waste as other technologies. “That, really, is the key. This means that with the same level of infrastructure and cost, and the same amount of waste handling and management, we are generating 2-4 times the income,” he said.
For companies in the Waste-to-Energy business, India represents a huge and largely untapped resource base. The country has a large agricultural economy that produces very large sources of organic material which would otherwise be burned. That waste organic material can be processed in specific facilities to generate energy.
According to Pollard, while these projects can be built at very large scales, Mount Row likes to build facilities that can produce 5 MW of electrical output and take up around 2-4 acres of land. Such projects do not have a large footprint and have a collection radius of 20-30 KM for waste material. This model works for rural communities or regional settings. But these plants can be built with a capacity of 100 MW or more where large volumes of municipal waste can be processed.
THE GLOBAL FOOTPRINT
Mount Row’s founders came together to look at opportunities in the infrastructure and renewable energy space with four pillars of investment focus. That includes diverse technology businesses, sustainable infrastructure being one of them. The company has assets in the Middle East, South East Asia, and is also involved in projects in Serbia, Eastern Europe, and looking at projects in Australia.
The basic idea is to identify technologies and projects that are both economically and environmentally sustainable. “There is an army of funds and investors out there trying to do similar things. What really excites us about this technology, and why we have decided to focus specifically on WTE, is that we believe we have found some of the best technologies in the world for converting waste products into energy and other useful things and because they have efficiencies in their processes and engineering they allow us to build returns on investments that are not possible with other technologies,” Pollard says.
Mount Row has around 20 facilities operational around the world, with waste strain ranging from Municipal Solid Waste to palm kernels. There are four operating projects in Serbia and a pipeline for the development and construction of ten more projects there based on agricultural waste. The largest operating plant at present is a 30 MW plant in Harbin, China which was commissioned in 2021 and uses rice and corn husk. The company also plans to build a 100 MW unit in Germany.
Source : EnergyWorld