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Reliance Power has announced its intention to legally challenge a recent three-year ban issued by India’s Solar Energy Corporation of India (SECI), which prohibits the company from bidding on SECI’s clean energy projects. This development, reported by Reuters, comes after SECI accused Reliance Power’s subsidiary of submitting a falsified bank guarantee.
According to SECI, the ban was imposed following its discovery that Reliance NU BESS Ltd., a Reliance Power subsidiary formerly known as Maharashtra Energy Generation Ltd., had included an allegedly forged bank guarantee as part of its bid documentation. This endorsement, associated with an earnest money deposit in the tender process, was flagged as fake during SECI’s scrutiny. SECI announced on Wednesday that it would restrict Reliance Power, along with its subsidiaries, from participating in upcoming renewable energy projects, sparking a prompt response from the company.
Reliance Power, a predominantly coal-based energy producer, has been actively pursuing opportunities to diversify into renewable energy, both domestically and abroad. In a board meeting last month, Reliance Power highlighted its plans to explore various funding avenues, including the sale of equity stakes and the issuance of foreign currency convertible bonds, as it seeks to finance this strategic shift. The company previously disclosed that expanding into renewable sector requires substantial investment.
In response to SECI’s decision, Reliance Power issued a statement asserting its innocence, claiming that both the company and its subsidiaries became victims of a third-party fraud scheme. The company has reportedly filed a complaint with the economic offenses wing of the Delhi Police against the unidentified third party involved in arranging the bank guarantee. The company refrained from naming the implicated entity.
This controversy unfolds as India pushes forward with its ambitious green energy targets, which aim to achieve 500 gigawatts of renewable energy capacity by 2030, part of the country’s commitment to reaching net-zero carbon emissions by 2070. India’s installed renewable capacity currently stands at around 154 gigawatts, underscoring the scale of the growth needed in the sector.
In a separate development earlier this year, Reliance Group’s chairman, Anil Ambani, received a five-year ban from India’s securities market, accompanied by a $3 million fine, following accusations from regulators regarding diversion of funds.