Why Reliance Power shares jumped 5% today; stock up 93% in 2024 so far

Shares of Reliance Power Ltd climbed 5 per cent in Thursday's trade, taking its year-to-date return to 93 per cent. The stock gained as Reliance Power subsidiary, Reliance NU Suntech, secured a 930 MW solar energy contract, including a battery energy storage system (BESS) project, in an e-reverse auction held on December 9. The contract was awarded by the Solar Energy Corporation of India (SECI).

The stock rose 5 per cent to hit a high of Rs 46.24 on BSE. Reliance Power notified the BSE and NSE that, according to the tender's terms, its subsidiary Reliance NU Suntech will also be required to install a minimum storage capacity of 465 MW/1,860 MWh, powered by solar energy. The company is awaiting the Letter of Award (LoA) from SECI.

"Reliance NU Suntech’s successful bid for SECI’s Tranche XVII auction was won at a tariff of Rs 3.53 ($0.0416)/kWh. The company, among India’s leading power generators, secured the largest individual allocation out of the five companies vying for a total quoted capacity of 2,000 MW of Inter-State Transmission System (ISTS) connected solar power projects with 1,000 MW/4,000 MWh energy storage systems," Reliance Power said.

The Anil Ambani-led firm stated that Reliance NU Suntech’s success highlights the technological advancements in solar power combined with battery energy storage systems (BESS) in India, positioning it as a cost-effective alternative to other renewable energy sources.

"The project will ensure a peak power supply for four hours daily (with a four-hour discharge duration). SECI will sign a 25-year power purchase agreement (PPA) with Reliance NU Suntech, and the solar power generated will be sold to various discoms across India," the company added.

Reliance Power's subsidiary will develop the project on a build-own-operate model and will be required to connect to the interstate transmission system (ISTS), in accordance with Central Electricity Regulatory Commission regulations for interconnection, the company informed the stock exchanges.