Adani Group Refutes Claims of Power Deal Revocation in Sri Lanka
India’s Adani Group affirmed on Friday that its power purchase agreement (PPA) with the Sri Lankan government remains intact, dismissing an AFP news agency report that claimed it had been revoked, citing a government official and a document.
Sri Lanka has been reassessing the group’s local projects following allegations by U.S. authorities in November that Gautam Adani, the billionaire founder, and other executives were involved in a bribery scheme to secure Indian power supply contracts. Adani has strongly denied these allegations.
In response to the AFP report, Adani stated that the 20-year PPA signed in May 2024 for its 484 MW wind power projects in Mannar and Pooneryn had not been cancelled. “Reports that Adani’s 484 MW wind power projects in Mannar and Pooneryn have been cancelled are false and misleading. We categorically state that the PPA has not been revoked,” said a company spokesperson.
Adani also clarified that the Sri Lankan cabinet’s recent decision to re-evaluate the tariff approved in May was part of a routine review process under the new government. The group reiterated its commitment to investing $1 billion in Sri Lanka’s green energy sector.
Sri Lanka’s Power and Energy Ministry declined to comment on the matter. However, two ministry sources, speaking anonymously, confirmed to Reuters that the project review was ongoing and that the PPA had not been revoked.
The deal involves Adani Green Energy constructing two wind power plants in Sri Lanka’s northern province with a combined investment of $442 million. The company would receive a tariff of 8.26 cents per kilowatt-hour (kWh).
Faced with power shortages and surging fuel costs, Sri Lanka has been prioritizing green energy projects to reduce dependence on imported fuels.
The U.S. allegations against Adani have sparked concerns among some partners and investors, leading to actions such as an Indian state reviewing its power deal with Adani and TotalEnergies halting further investments in the conglomerate. Internationally, Kenya recently terminated over $2.5 billion in contracts with the group.
Adani remains involved in significant projects in Sri Lanka, including a $700 million terminal development at Colombo Port.
Despite the controversy, Adani Green Energy shares closed 1.8% lower in Mumbai, while its flagship unit, Adani Enterprises, ended nearly 3% lower amidst a weak broader market.