India’s Genus launches $2bn smart meter funding platform

India’s Genus launches $2bn smart meter funding platform
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Indian smart metering major Genus and an affiliate of Singapore-based GIC have announced a joint venture (JV) agreement to set up a funding platform for smart meter projects with an initial $2 billion pipeline.

Genus Power & Infrastructures and Gem View Investment, an affiliate of wealth fund GIC, signed an agreement to set up a platform for Advanced Metering Infrastructure Service Provider (AMISP) concessions.

GIC will hold the majority 74% stake in the platform with Genus holding the remaining 26%.

Genus will be the exclusive supplier to the platform for smart meters and associated services.

The agreement also includes a INR5.2 crore ($63.1 million) investment from GIC’s Chiswick Investment for 15% in the Indian smart metering company.

According to GIC in a press release announcing the JV, the agreement represents the largest transaction in India’s smart metering space.

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Speaking on the development Jitendra Kumar Agarwal, joint managing director of Genus, in an interview with BQ Prime stated that the platform was created to fund the coming smart meter projects over the next three to five years.

“GIC comes as a financial partner and Genus comes as a technical and system integrator partner.”

When it comes to projects seeking funding, Agarwal states “the platform will have an exclusive arrangement with Genus Power as a system integrator (for AMISPs)…for manufacturing of meters, technical solutions and installation (etc.).”

The platform also is the prime bidder of the contracts to the state electricity boards.

The Government of India is implementing its National Smart Metering Project under the Revamped Distribution Sector Scheme (RDSS), with plans to install the 250 million meters by 2025 at an estimated investment of $30 billion.

With technical and commercial losses exceeding 15% for all major Indian utilities leading to high financial losses, smart metering projects under the RDSS scheme are hoped to reduce such losses, improve operational efficiency of DISCOMs and improve their financial sustainability.

AMISP concessions are awarded by the various state utilities under the RDSS with a concession life of up to 10 years. Concessionaires receive a monthly service charge during this period for installing and maintaining meters and the associated infrastructure.

With the JV, Genus will supplement its manufacturing and execution capability with access to new capital. Genus has also stated it will scale up smart meter deployment in the country in its bid to support energy security and transition through grid optimisation.

According to the Economic Times, Genus Power Shares hit the 20% upper circuit after the platform agreement.

The transactions are subject to the approval of Genus shareholders and fulfilment of customary closing conditions to the satisfaction of the GIC affiliates.

Jitendra Kumar Agarwal, in his capacity as Joint Managing Director of the Indian Electrical and Electronics Manufacturers Association (IEEMA) in India, spoke to Kelvin Ross at Enlit Europe in Frankfurt.