The world is moving towards green energy and can you really expect Mr. Mukesh Ambani to stay dormant in this new revolution. They revolutionized the telecommunication sector in India through Jio. Now, Reliance Industries Limited is again looking forward to changing the world for the better. This time the sector they are targeting is energy.
Reliance currently has three verticals. First, the O2C (Oil-to-Chemical) business that houses oil refineries, petrochemical plants, and fuel retailing business. Second, digital services that comprise of telecommunication arm Jio. Third, Retail Business including E-Commerce. Now, the fourth business vertical is in the offing. That is Energy.
Plan of investing Rs.75000 Crore
According to a report by Wall Street brokerage Bernstein Research, Reliance is planning to invest Rs.75000 Crore in solar batteries, fuel cells, and hydrogen. This investment could create a valuation of USD 36 Billion (Approx. 2.6 Lakh Crore) for the new energy business. As announced in the Annual General Meeting of RIL the investment will take place over the period of the next three years. Through these efforts, the company is trying to create an integrated clean energy ecosystem.
The report noted “Many oil companies have tried and failed to become clean energy manufacturing companies and instead focus on clean energy production. Reliance’s focus on manufacturing is distinctive and potentially offers higher margins but is also higher risk given their limited capabilities in clean energy”. They also showed concern regarding cooperation among players in the market but at the same time, the report took an optimistic stance regarding it.
“While companies will be reluctant to share their technology with a potential competitor, the market opportunity in India may be enough to persuade some. Korean battery makers could be potential partners in energy storage, while companies like Plug and Ballard could be partners in fuel cell manufacturing.” The report said.
Reliance to spend Rs. 60000 Crore to build Giga Factories
In order to make integrated solar PV modules, electrolyzers, fuel cells, and batteries to store energy from the grid, the company is planning to invest Rs.60000 to build Giga Factory. The factory will be located at 5000 Acre Green Energy Giga complex in Jamnagar, Gujrat. Additional Rs 15,000 crore will be utilized for investments across the value chain, technology, and partnerships for the new energy business.
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