At the outset, I thank all the stakeholders who have reinforced trust in us to infuse USD 824 million of equity investment and subscribed to Green Bond issuance of USD 1035 Million. We are thankful to all partners who came forward to join our challenging endeavor in Pumped Storage and Intelligent Energy Platform. Our employees and communities have been on our side through this journey, despite weather and health emergencies. The regulators and policymakers have given us a patient hearing, understood our concerns, and responded very positively. Further,I place my gratitude to the businesses and industry that have made us partners in their climate stewardship journey. Many of them are eagerly looking forward to our firm renewable energy generation to twine us in their NET ZERO EMISSIONS plans.
At Greenko, our focus is to deliver value to all our stakeholders and contribute to the sustainable development of India and the Globe. Our business has been aligned to contribute to UNSDG 7- affordable and clean energy and UNSDG 13-climate action. We continue to deliver #MoreSmilesPerWatt as we gain shareholder trust by following good governance practices, employee commitment through practicing ownership model, community involvement through the Public-Private- People approach, and governments’ support by aligning to its policies and programs. Further, we have adopted circular economic approaches to contribute to UNSDG 12-responsible production and consumption.
Despite the decelerated demand for electricity, during the reporting period, the renewable electricity generation globally rose by 6%, and wind and solar PV technologies together accounted for 64% of this growth. However, the renewable power capacity addition has to accelerate significantly to meet the Paris Climate Goal and Sustainable Development Pathways of individual nations. Despite a 7% year-on-year reduction in overall expenditures, grids became further decentralized and digitalized in 2019. Utilities around the world deployed more sophisticated technologies, including artificial intelligence and digital twinning. Nevertheless, more efforts are required to implement regulations and policy frameworks that reward the benefits of digitalizing electricity networks.
India’s total renewable energy capacity was 131 GW in 2019, and it has set a target of reaching 275GW by 2027. Despite the ‘must run’ status of renewable power, wind and solar projects, it faced the challenge of nonadherence to contracts and large-scale grid curtailment in 2019. Even against this backdrop, in FY 20, there was an addition of 11GW of renewable capacity with solar contributing approximately 9GW.
As the #Decarbonization, #Digitalization, and #Decentralization is advancing, the energy sector in India is facing turbulence and this is likely to be prolonged. While this disruption will continue to challenge the policy paradigms and old business models, it is also presenting new opportunities. Adoption of better generation technologies, digitalization leading to efficient and remote management of assets, and intelligent matching of demand and supply has led to a decrease in the cost of renewable energy. New Energy is just not clean but reliable and affordable. New Energy offers energy and energy plus services through dovetailing energy management, digital technology, dispatchable energy, storage and hydrogen.
However, the renewables will not be reliable unless transformed into firm and flexible solutions. As the renewable generation becomes firm, it displaces non-renewables to meet the objectives of deep decarbonization of the economy and fulfil climate change obligations to keep global warming under control. Our pumped storage projects combined with an intelligent energy platform would transform the renewables into New Energy, thus paving the way for achieving energy security for India and long-term stability of electricity prices. Our #NayeeSoch - #NewEnergy services would, thus deliver #NayaJosh - #EnergySecurity and #EconomicStabilty to India.
Greenko’s pumped storage combined with intelligent energy platform could offer many more grid-related solutions and deliver value to the electricity systems. The regulatory system in India has been sensitive to this value addition and is aligning the policies to incentivize the contribution. My colleagues have engaged in public policy advocacy to highlight the need for RE firming and the associated value that it delivers in grid balancing. The need for RE + Storage based power supply projects to enable RE firming was highlighted during engagements with tendering agencies. We are delighted to notice more of RE + Storage based firm, flexible power supply-based tenders. In fact, Greenko has won one such Round- The-Clock RE bid from Solar Energy Corporation of India. Further, we have contributed to highlighting the inability of thermal generation to manage ramp-up/ rampthat down requirements in the absence of “standalone storage” / “RE + Storage” based generation projects. We believe that the regulators are sensitive to and will reward the businesses appropriately for RE arbitrage, wholesale arbitrage, frequency and voltage regulation, and Transmission & Distribution investment deferral, etc. We, at Greenko, realize that we are a salient part of electricity sector transformation that makes clean, reliable, and affordable electricity and reinforces #AtmanirbharIndia with #EnergySecurity and #EconomicStabilty. New Energy solutions would drive 50% of our longterm investments in the next years and contribute to 50% of our revenues thereafter. New Energy solutions will be customer focused and add value to market to bring cost of energy down by 20% nationally from the current level. Transitioning to New Energy business model is not just a business opportunity for Greenko but, it is a part of our commitment and social responsibility.
We are certain that we are in the right place and at the right time, but this alone is not enough. I am delighted that Greenko, as always, has seized the moment and responded to the challenge. It has pooled resources, made the right moves- swiftly and diligently. Our pumped storage design is flexible enough to harness many value pools that may be rewarded as the policy ecosystem evolves. We brought together the best and effective technology and expertise available globally through international competitive bidding. The innovative contracting structures to share risk and reward are appreciated by our partners and hence we believe that it will deliver sustainable results. Though challenging, our design, engineering procurement, contracting, and quality assurance processes have been sensitive to performance across the life cycle of the projects, while evaluating options efficiently.
Governments and businesses, across the globe, are readying themselves to harness opportunities in circular economy. The sharing economy is an important component of this. Our business model of pumped storage combined with an intelligent energy platform has been deployed as a sharing platform for storage and energy management. It would offer energy and energy plus services to multiple customer groups’ viz., distribution companies, RE generators, Grid, and industry.
Despite the continuing challenges in the power sector in India, primarily due to sluggish economic growth. Investors continue to trust our value creation model and our ability to sustain it. This is particularly exemplified by the oversubscription of our green bond offers and ratings by multiple agencies. We are sanguine that investors are keen to participate in harnessing value in transforming the energy system in India.
We have been diligently picking organic and inorganic growth opportunities Strategically, we have improved our access to hydropower in different geographies of India. Our equity stake in Teesta Urja Limited with an underlying asset of 1,200 MW of Hydropower project in North Sikkim” and acquisition of assets of 100 MW is a part of our transformation. Besides pursuing inorganic opportunities, we continue our pursuit of developing greenfield projects.
We continue our focus on high capital productivity and accordingly we made investments in operation and maintenance through intense deployment of digitalization. We have been improving our Asset performance and reducing the O&M costs of our wind generation under the WINSOM program. Going further, besides significant investment focus on Integrated Renewable Energy Projects, we would continue with the renovation and modernization of some of our wind assets. During the reporting period, we sold 10% of our power to the B2B segment and this demonstrates our ability to access energy customers directly, which will be a salient feature in our transition to Greenko 3.0 .
Each of our employees take ownership of the task and their contribution has a sense of purpose beyond the call of duty and each employee becomes our brand ambassador. This initiative is augmented further with PPS (People, Process, and System). We are proud rampthat these operational transformations in combination with Innovation Hub would align the organization for transition to Greenko 3.0 . Our commitment to complete the IRESP in 36 months is based on a solid edifice of committed people. During the reporting period, we have spread Integrated Thinking across the organization. Three IR conclaves held at different locations of India had the participation of more than 200 IR champions, sharing 130 success stories, of which 30 won recognitions and awards. I am excited by this groundswell of alignment with the company’s strategic goals. We are already witnessing the impact of this alignment through seamless progress and agility in addressing multiple challenges.
In the reporting period, we achieved per capita training hours of 35.3 and retention rate of 93%, we strive to maintain and enhance the same in the future. This in combination with innovation hub activities, goes a long way in upskilling and aligning people to the transformational journey that the organization has undertaken. The number of hours devoted to the safety training has significantly increased over the previous year. We continue to achieve zero fatalities in this reporting period. Our turnover in the age group of younger than 30 years is high and more so amongst women and we will address this challenge.
We owe our success to our external stakeholders, including suppliers and customers. More than 80 % of our suppliers have been working with us for more than three years. As the new initiatives that we are undertaking are highly technology-intensive and require deep expertise and experience, we are joined by many new partners. We note with satisfaction that our suppliers and customers are happy with us as indicated by the respective satisfaction indices of 80% & 100%.
Our community development initiatives have grown by two times, over the previous reporting period, in terms of the number of beneficiaries. Such an increase has become possible by strategically targeting and effectively investing. We would sharpen our focus by measuring social return on investment during the coming year.
We partner to contribute to sustainable development - UNSDG 17. We partnered with WWF to conserve the threatened species Olive Ridley Turtles and with the Government of India for conserving Great Indian Bustard. We have decided to add one threatened species to conserve each year, recognizing the pace at which the earth is losing the biodiversity. This year, we have initiated plans to conserve Red Panda in coordination with Government of Sikkim. We recognize the need to collaborate to effect change and thus, partnered with WEF, etc. and have received awards and recognitions in this regard. Beginning this reporting period, we have initiated the climate change risk assessment and management managing our assets.
Greenko continues to contribute to the UNSDGs and socio-economic progress of India while delivering value to all stakeholders. The success of this journey is contingent upon partnerships and engagement with stakeholders. Your suggestions & views are valuable to us in further improving our performance.
Chief Executive and Managing Director