Adani gives up on $ 1 b wind power project

• Move in response to AKD Govt. deciding to appoint  another Cabinet negotiations committee and Project Committee to renegotiate the previously approved proposal involving 14 rounds of negotiations over 2 years
• Says “As we bow out, we wish to reaffirm that we would always be available for Sri Lankan Government to have us undertake any development opportunity, if it ever considers Adani Group to participate”

Energy giant, Adani has decided to withdraw from its proposed $ 1 billion wind power project based on the build-own-operate (BOO) model in Mannar and Pooneryn.

The move follows the President Anura Kumara Dissanayake administration deciding to renegotiate the previously approved project for a lower cost.

“Adani Green Energy has conveyed its Board’s decision to respectfully withdraw from further engagement in the RE wind energy project and two transmission projects in Sri Lanka. However, we remain committed to Sri Lanka and are open to future collaboration if the Government of Sri Lanka so desires,” said a spokesperson for Adani Group in a brief statement. 

However Adani in a letter dated on 12 February, to the Board of Investment (BOI) Chairman stated: “Our executives recently had discussions with CEB officials as also with Ministry officials at Colombo. It was learnt that another Cabinet Appointed Negotiations Committee (CANC) and Project Committee (PC) would be constituted to renegotiate the project proposal. This aspect was deliberated at the Board of our company and it was decided that while the company fully respects the sovereign rights of Sri Lanka and its choices, it would respectfully withdraw from the said project.”

The move comes following the Daily FT exclusively reporting on 24 January 2025 that the Cabinet of Ministers chaired by President Anura Kumara Dissanayake has revoked a decision made by his predecessor Ranil Wickremesinghe in June 2024 to award a controversial 484 MW of wind power plants in Mannar and Pooneryn to Adani Green Energy SL Ltd., (https://www.ft.lk/top-story/AKD-Government-revokes-contentious-500-MW-Adani-wind-power-contract/26-772133) and the company next day (25 January) issued a statement denying the cancellation of the project (https://www.ft.lk/front-page/Adani-denies-cancellation-of-wind-power-project/44-772221).

On 28 January Cabinet Spokesman and Minister Dr. Nalinda Jayatissa confirmed the Government has begun negotiations to revise the Power Purchase Agreement (PPA) over Adani Green Energy’s proposed 484 MW wind power project with a focus on reducing the tariff below six cents per kilowatt-hour (kWh). (https://www.ft.lk/business/Govt-seeks-lower-tariff-for-Adani-s-wind-power-project/34-772358).

In its 12 February letter to the BOI, Adani said: “As you are aware, Adani Green has been under protracted discussions with CEB and various Government departments since past more than two years, in respect of establishing 484 MW Renewable Energy Wind Farms at Mannar and Pooneryn, Sri Lanka, along with its associated Transmission system, as also additional 220 KV and 400 KV Transmission network expansion to carry electrons to consumptive centres in the southern part of Sri Lanka.”

“In pursuit of said proposal, Adani Green teams had several rounds of discussions with state appointed committees and after more than 14 rounds of discussions, approval was accorded on Tariff, fixed for 20 years, for the Power Purchase Agreement. Adani Green also worked on all clearances and licences,” it added.

The company also disclosed that it has already invested $ 5 million in pre-development activities, securing most clearances except for an environmental approval in Mannar, which remains entangled in Supreme Court case.

“As we bow out, we wish to reaffirm that we would always be available for Sri Lankan Government to have us undertake any development opportunity, if it ever considers Adani Group to participate,” the letter added.