ReNew Energy Secures $100M UK Backing to Fuel Solar Manufacturing Ambitions

LONDON—British International Investment (BII), the UK’s development finance institution, has committed $100 million to ReNew Energy Global Plc’s solar manufacturing subsidiary, ReNew Photovoltaics Private Limited, marking its first foray into India’s solar supply chain. The investment underscores growing international confidence in India’s renewable energy ambitions, particularly its goal of achieving 500 GW of renewable capacity by 2030, while also addressing critical geopolitical and economic challenges tied to energy independence.

The Investment: A Strategic Bet on Solar Autonomy

The $100 million infusion will fund the construction of a 4 GW TOPCon solar cell manufacturing facility in Dholera, Gujarat—a project expected to double ReNew’s existing solar cell production capacity (currently 2.5 GW) and align with its 6.4 GW solar module plant in Rajasthan. The facility, once operational, will serve both ReNew’s internal demand for its 10 GW of operational renewable projects and third-party clients, including state-owned NTPC and industrial firms.

BII’s minority stake—estimated at 10%, contingent on ReNew Photovoltaics’ EBITDA performance in fiscal 2026—ties its returns to the subsidiary’s profitability. This structure incentivizes ReNew to optimize efficiency, a critical factor as global solar commodity prices remain volatile.

Why Solar Manufacturing Matters

India’s renewable energy sector has long relied on imported solar cells and panels, particularly from China. ReNew’s expansion directly addresses this dependency. By 2030, the government aims to localize 50% of solar component production, a goal central to its “Make in India” initiative. The Dholera facility will create over 2,000 jobs, boosting domestic manufacturing and reducing carbon emissions tied to international shipping.

ReNew’s progress to date is promising: it has already supplied 900 MW to external customers and holds 1.5 GW in pending orders, signaling strong demand. Its parent company, ReNew Energy Global Plc (NASDAQ: RNW), reported a 31% year-over-year profit increase in Q2 2024, bolstering confidence in its operational and financial stability.

Geopolitical and Climate Implications

The partnership reflects broader UK-India collaboration on clean energy. Sally Taylor of the British High Commission highlighted the deal’s role in diversifying global solar supply chains, a priority amid US-China trade tensions. For India, the investment reinforces its position as a hub for low-cost solar manufacturing, with ReNew aiming to supply 6.4 GW of modules and cells combined post-expansion.

Shilpa Kumar of BII emphasized the project’s dual benefits: reducing import bills and supporting climate resilience through scalable, affordable solar technology. With India’s renewable capacity expected to hit 290 GW by 2026 (per government estimates), ReNew’s manufacturing arm is poised to play a pivotal role.

Risks and Challenges

Despite the optimism, hurdles remain. Regulatory approvals for foreign investments in India’s solar sector can delay timelines, though BII’s alignment with national priorities likely expedites the process. Additionally, global polysilicon price fluctuations—a key input for solar cells—could squeeze margins. ReNew’s vertically integrated supply chain and long-term contracts with buyers mitigate some risks, but execution remains critical.

Conclusion: A Win for Investors and India’s Green Future

ReNew’s $100 million BII-backed expansion is more than a financial transaction—it’s a strategic move to solidify India’s position as a solar manufacturing powerhouse. By 2025, the Dholera facility will be a cornerstone of Prime Minister Modi’s 500 GW target, creating jobs and reducing reliance on imports.

For investors, ReNew Energy Global Plc’s $17.4 billion enterprise value and top-10 global ranking in S&P’s 2024 sustainability assessment signal robust long-term potential. While near-term risks exist, the partnership’s alignment with India’s policy goals and ReNew’s operational track record—powering 5.9 million homes—suggests this is a bet worth taking.

As global clean energy transitions accelerate, ReNew’s growth is not just a story of solar panels but of India’s ambition to lead the green economy. The next step? Delivering on the Dholera facility’s promise—and proving that “Make in India” can shine globally.