An overview of how was the overall environment, given the challenges of the year.
The global economy is climbing out from the depths to which it plummeted during the onset of COVID-19. The economy’s long ascent back to pre-pandemic levels of activity remains prone to setbacks. Downside risks to global growth outlook include a synchronised pandemic resurgence, supply-chain disruptions, inflation, geopolitical strains and possible climate-related disasters.
Economic activity gained further traction during the year, aided by expanding vaccination coverage and improved business sentiments. Despite the near-term headwinds, broad-based reforms by the government imply strong economic outlook. Though COVID-19 infection and inflation are near-term risks, reforms and policies are seen driving growth.
The COVID-19 pandemic inflicted high and rising human costs worldwide, and the necessary protection measures severely impacted economic activity. As a result, global economy declined sharply in 2020 and 2021, worse than during the 2008-09 financial crisis.
Prices of commodities in the global market saw renewed rallies during the year driving accelerated inflation and increasing consumer costs. They are likely to average higher than the levels seen during the last five years. Climate change may also increase commodity price volatility.
The Indian government has been giving a massive push to the infrastructure sector. It has expanded the National Infrastructure Pipeline to 7,400 projects. Through NIP, the government has already planned an investment pipeline of USD 1.4 trillion in infrastructure development.
Power demand in India has been growing incessantly on account of a strong pick-up in economic activity and a low base effect. All-India peak power demand increased 7.9% year-on-year. Moving ahead, demand is estimated to be 1,650.59 Billion Units (BU) in 2022-23, compared to 1,375.66 BU in 2021-22, and 1,275.53 BU in 2020-21. Progress on Smart Cities and infrastructure will further boost demand for electricity.
India ranked 3rd in renewable energy country attractive index in 2021. It has set an ambitious target to achieve a capacity of 175 GW worth of renewable energy by end-2022. The momentum driving India’s transition to clean energy is accelerating and it has committed at COP26 to achieve 500 GW of non-fossil fuel installed electricity capacity by 2030.
Coal-fired power plants (with major pollutants being oxides of nitrogen, sulphur dioxide and particulate matter) have to mandatorily comply with new standards and emission norms by December 2024. Revised norms for SOx emissions will lead to higher capital expenditure for environmental compliance.
We remain committed to own and operate a diversified portfolio of assets in thermal, hydro and renewable segments, delivering maximum operational efficiency. Through the adoption of global best practices, we are always working to reduce the impact our operations have on the environment. Through our future strategy of advancing in the renewable energy segment, our objective is to ensure sustainable value creation for all our stakeholders. Believing in sustainable value creation, we remain fully committed to the environment and the society, and strive to reduce our carbon footprint.
Our single-minded aim is to build our organisational capabilities in the renewable energy space and commissioning new renewable capacities. We are already treading on this path by having initiated the process of acquiring topographically productive land banks in resource rich areas. A strong balance sheet and healthy cash flows makes us well-positioned to pursue attractive growth opportunities. This also provides us with enough headroom to pursue our growth plans in the renewable energy segment. In addition, we are also evaluating inorganic growth opportunities to create significant value for our stakeholders.
At JSW Energy, our key strategy of moving forward in the renewable energy space adheres well with the changing dynamics of the Indian power sector and the changing economic landscape in India. With capacity addition in the power sector being primarily driven by renewable energy, we project an immense and untapped potential in the renewable energy segment to grow our business and create stakeholder value creation.
Well-supported by an existing portfolio of efficient thermal and hydro assets, our strategy is to capitalise on the golden-era of renewable power generation and contribute in playing a significant role in ensuring a carbon-free future in India. By FY30, we plan to emerge as a 20 GW company, with all our incremental capacity coming from renewable sources. By striking a perfect balance between our growth aspirations and prudent risk management, we have onboarded new opportunities in the business, which has mainly led us towards emerging as India’s leading power producer.
Investing in assets with a capability to generate low-cost power to reduce offtake and receivable risks; Engaging into long-term PPAs ensuring visibility to stable long-term cash flows and stable revenues.
Blending excellent project execution and operational expertise to generate healthy free cash flows.
Utilising free cash flows to invest in returns accretive capex which then drives de-leveraging of the balance sheet, and in the process, generating headroom to pursue value-accretive growth.
Enabling prudent capital allocation with stringent due diligence practices; business case is stress-tested effectively to ensure economic viability of proposed projects.
We are creating growth and value for our shareholders, employees and society by transitioning to green energy.
We take all business decisions by considering the interests of all stakeholders.
We provide support as an ‘Energy Partner’ and not just an ‘Energy Supplier’, with strong PPAs and supply-side linkages.
We constantly strive to stay atop the technological curve by imbibing global best practices and best-inclass technologies.
We consciously align ourselves with regulations to achieve business goals and attain our investment objectives.
We provide our full-fledged support in combating global warming and climate change.
Optimising operations and performance to get the best return on assets.
We maintain a strong balance sheet and liquidity with enough headroom for pursuing returns-accretive growth and sustained value creation.
We contribute towards the upliftment and improvement of our social communities for inclusive growth.
Development of reliable power supply infrastructure directed towards customer service and initiatives that support net-zero transformation.
Transitioning to Renewables
We are creating growth and value for our shareholders, employees and society by transitioning to green energy.
Inclusive Approach
We take all business decisions by considering the interests of all stakeholders.
Energy Partner
We provide support as an ‘Energy Partner’ and not just an ‘Energy Supplier’, with strong PPAs and supply-side linkages.
Technologically Agile
We constantly strive to stay on top of the technological curve by imbibing global best practices.
Regulatory Environment
We consciously align ourselves with regulations to achieve business goals and attain our investment objectives.
Generation of electricity from renewable energy such as hydro and solar
Read our Corporate Governance ReportOur presence is in power generation (thermal, hydro and solar), power transmission, and power trading.
Becoming Net-Zero
We provide our full-fledged support and commitment in combating global warming and climate change.
Operational Excellence
Optimising operations and plant performance to get the best return on assets.
Financial Discipline
We maintain a strong balance sheet with enough headroom for growth and sustained value creation.
Corporate Social Responsibility
We contribute towards the upliftment and improvement of our social communities for inclusive growth.
Generation of electricity from energy sources such as coal
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