Adani bribe charges: R P Gupta, chairman and managing director (CMD) of Solar Energy Corporation of India (SECI), on Thursday, said the agency has not been implicated in any wrongdoing in the Adani case. The Solar Energy Corporation of India (SECI) is the nodal agency for the implementation of renewable projects in India.
US prosecutors on Thursday have charged billionaire Gautam Adani with allegedly participating in a scheme to pay a $265 million bribe to Indian officials in exchange for favourable terms in solar power contracts.
“There is nothing against SECI that SECI has done anything wrong. That is no where. There is no mention of any wrongdoing or irregularity on part of SECI,” he said while responding to PTI queries on developments related to the Adani case.
SECI holds a Category-I Power Trading License, which allows it to operate as a top-level power trader across India. The company acquires electricity from approved developers through its tenders and supplies it to Buying Entities such as DISCOMs through long-term Power Purchase Agreements (PPAs) and Power Sale Agreements (PSAs).
As per the document filed by US prosecutors, Solar Energy Corporation of India Ltd (SECI), the entity that initially granted the solar manufacturing-linked power tender, finalised sales agreements with Andhra Pradesh, Odisha, Chhattisgarh, and Tamil Nadu between July 2021 and December 2021.
The legal charging also mentions Azure Power, a company based in New Delhi, which had secured a similar tender for the supply of 4 GW.
However, when Azure Power was unable to provide its portion of the bribe money given to the states for purchasing costly power, Adani compelled the company to relinquish a portion of its contract. Subsequently, Adani took over this segment of the contract through SECI.
On his plans for future course of action, Gupta said, “There is no allegation against us. It is only against state governments… so those who have allegations against them, it is for them to take any action.”
What happened in 2019
The entire scenario traces back to the year 2019 when SECI successfully concluded the bidding process for a groundbreaking combined tender covering 12,000 MW of solar power generation and 3000 MW of solar panel manufacturing. Adani Green and US-based Azure Power emerged as the winners of this historic tender.
Despite their victory, SECI faced challenges in finalising power supply agreements (PSAs) with state electricity distribution companies (DISCOMs) due to soaring energy prices. Consequently, illicit payments were made to Indian government officials to facilitate the signing of PSAs with state DISCOMS. In the absence of these crucial agreements, SECI was unable to proceed with signing power purchase agreements (PPAs) with Adani Green and Azure Power.
As per the US court, SECI’s failure to secure buyers put at risk the expected profitability of the LOAs and associated revenue for the two companies. The court also stated that the individuals involved in the scheme made significant efforts to unlawfully influence government officials in order to persuade state electricity distribution companies to enter into PSAs.
US prosecutors alleged that Gautam Adani personally met with an undisclosed government official in Andhra Pradesh to facilitate the signing of a PSA between SECI and Andhra Pradesh’s state electricity DISCOMs, with an alleged bribe of approximately Rs 1,750 crore.
The mega solar deal
In June 2020, Adani Green Energy Limited and another renewable-energy company listed on the New York Stock Exchange were awarded contracts by the Solar Energy Corporation of India. Adani Green Energy claimed to have secured “the world’s largest solar award” with a $6 billion investment in solar energy. Over a 20-year period, it was projected to generate over $2 billion in profit after taxes. Adani Green Energy Limited announced that it had won a unique manufacturing-linked solar agreement from the Solar Energy Corporation of India (SECI).
“As a part of the award, AGEL will develop 8 GW of solar projects along with a commitment that will see Adani Solar establish 2 GW of additional solar cell and module manufacturing capacity. This award, the largest of its type, ever, in the world, will entail a single investment of Rs. 45,000 crores (US $6 billion) and will create 400,000 direct and indirect jobs. It will also displace 900 million tonnes of carbon dioxide over its lifetime,” the company claimed in a press release.
In the press release, Gautam Adani said, “We are honoured to be selected by SECI for this landmark solar award. In today’s world, climate adaptation cannot be considered independent of economic development priorities and both, job creation as well as decarbonization must be simultaneous objectives… The fact that renewable power will transition into becoming the world’s cleanest and most economical fuel is a foregone conclusion and the Adani Group intends to play a leading role in this journey. This award is yet another step in our nation’s climate change promise to the world as well as enabling our nation’s Atma Nirbhar Bharat Abhiyan (Self Reliant India Program).”
(With agency inputs)
