COLOMBO: India’s Adani Green Energy on Wednesday said it has decided to withdraw from two planned wind power projects in Sri Lanka. The company informed a Sri Lankan government agency about this decision through an official letter.
Last month, Sri Lanka’s government started talks with Adani Group to reduce electricity costs from these projects, which were expected to cost around USD1 billion.
Adani announced that it had already spent about USD5 million on initial development work for a 484-megawatt wind power plant on Sri Lanka’s northwestern coast. However, the company has now decided to step away from the project. Despite this, Adani said it is open to working with the Sri Lankan government on other future projects.
According to a Reuters report, Sri Lanka had set up new committees to renegotiate the terms of the project. In a letter dated February 12, Adani stated that while it respects Sri Lanka’s sovereign rights and decisions, it has chosen to withdraw from the project.
Sri Lanka’s Board of Investment refused to comment, and the power ministry secretary was not available for a response. Adani has not issued any public statement on the matter.
This move comes as Sri Lanka reviews Adani Group’s projects in the country. The review started after U.S. authorities accused Adani’s founder, Gautam Adani, and other executives of being involved in a bribery scheme to secure power supply contracts in India. Adani has denied these allegations.
Adani Green was initially set to develop wind power plants in Mannar town and Pooneryn village, both in Sri Lanka’s northern province. Apart from these projects, the Adani Group is also working on a USD700 million terminal at Colombo’s main port.
Sri Lanka has been pushing for more renewable energy projects to reduce its dependence on imported fuel, especially after facing severe power cuts and fuel shortages during the 2022 economic crisis.
Meanwhile, Adani Green Energy’s stock price rose by 2 percent on Thursday, trading above Rs 935 on the NSE, after reports of the company’s exit from the Sri Lanka wind power project surfaced.