Work on the first of the proposed plants is slated to begin at Gangarampur in West Bengal in the fourth quarter of 2009. Under the agreement, Areva Bioenergy will design, construct and commission the plants. While Areva will make 40% of the total investment, Astonfield will cover the rest. The agreement falls in line with Areva's plans to expand its renewable energy portfolio, especially in Southeast Asia and India. With this lineup of projects, Astonfield will continue to deliver shovel-ready projects with finances, land, permits, and power purchase agreements already in place.
The CEO of Areva Renewables, Anil Srivastava, said that the company will utilize all the expertise garnered from the firm's 100 bioenergy plants currently in operation or under construction worldwide to implement the new projects. The company's existing projects translate into more than 2,800 MW of installed power generation capacity and reduce emissions equivalent to 3 million tons per year of carbon dioxide. Areva has also promised to help the plant operators gain from carbon credits and is willing to buy back the voluntary carbon credits that will be generated by the projects.
Ameet Shah, Co-Chairman of Astonfield, said that it was time to prove that the biomass sector in India was scalable and could make a profitable and meaningful contribution to rural development. He said, "Through our strategic partnership, Astonfield and Areva will demonstrate the commercial and technical model that the biomass sector needs to become a vibrant and productive part of the next stage of growth of the country's energy infrastructure."
The agreement is expected to be followed by an announcement from Astonfield about a $2 billion investment in India that will be used to set up 1,000 MW worth of renewable power projects in the country during the next five years. Such an amount would be the highest single investment made in the country's renewable energy sector. Shah said that details about the investment plan would be disclosed within the next couple of months. A major portion of the funds will be used to set up 500 MW worth of solar power projects.
Astonfield's current portfolio in India includes 228 MW of solar power and 110 MW of power from biomass. Approval applications have been submitted to the authorities concerned for another 345 MW of renewable power, which includes 245 MW of solar power, 40 MW of biomass-based power, and 60 MW worth of waste-to-energy conversion units. The installed projects are spread across the states of Bihar, Gujarat, Haryana, Karnataka, Rajasthan and West Bengal.
Areva Renewables has been involved in India's renewable energy sector since 2007. The company has about 48 MW worth of biomass-based power plants operating or under construction in the states of Andhra Pradesh, Chhattisgarh, Karnataka, and Tamil Nadu. Areva Renewable Energy was created in 2006, and the objective of the group is to focus on bioenergy, hydrogen energy, wind power, and offshore turbine technology. The unit meets the needs of China's renewable energy market with technical solutions in the sectors of biogas, biomass, heat recovery and mine gas.