JSW Energy Ltd (JSWENERGY) Q1 FY24 Earnings Concall Transcript

JSW Energy Ltd (NSE: JSWENERGY) Q1 FY24 Earnings Concall dated Jul. 14, 2023

Corporate Participants:

Prashant Jain — Joint Managing Director and Chief Executive Officer

Pritesh Vinay — Director Finance, Chief Financial Officer

Analysts:

Sudhanshu Bansal — JM Financial — Analyst

Mohit Kumar — ICICI Securities — Analyst

Karan Gupta — — Analyst

Anuj Upadhyay — Investec — Analyst

Shreyans Daga — Barclays — Analyst

Manas Arora — Dinero Wealth — Analyst

Chirag Kachhadiya — Individual Investor — Analyst

Presentation:

Operator

Ladies and gentlemen, good day and welcome to Q1 FY ’24 Earnings Conference Call of JSW Energy hosted by JM Financial. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Sudhanshu Bansal from JM Financial. Thank you and over to you.

Sudhanshu Bansal — JM Financial — Analyst

Thank you, Yashashri [Phonetic]. Good evening, everybody. On behalf of JM Financial, I welcome you all to the conference call of JSW Energy Limited to discuss the first — 1Q FY’24 results. We have with us the leadership team of JSW Energy comprising of Mr. Prashant Jain, Joint Managing Director and CEO; Mr. Pritesh Vinay, Director Finance and CFO; Mr. Bikash Chowdhury, Head, Investor Relations and Treasury. Thank you so much sirs for your kind presence and giving JM Financial the opportunity to host the call.

With this. I would like to hand over the call to Mr. Prashant Jain for opening remarks and taking the call forward. Over to you, sir.

Prashant Jain — Joint Managing Director and Chief Executive Officer

Thank you. Good evening, ladies and gentlemen. During the quarter gone by, we saw the power demand very muted at 1%, primarily due to in the month of April and May, we saw the unseasonal rains. And the power demand was close to flat or negative. However, the power demand improved in the month of June at 4.5%. And in the July also, it is going robust at 5.5%. The total installed capacity in this sector stands now at 422 gigawatt. During the quarter, there was a total capacity addition of 5.8 gigawatts of which 4.5 gigawatts was renewable capacity with 1.1 gigawatt of wind and 3.3 gigawatt of the solar.

During the quarter gone by, the total energy generation was up by 14% for the company. After that, 911 million units came from Mytrah portfolio, another 106 million units from Group Captive and SECI X portfolio. And 421 million units additional came from Ratnagiri. However, there was newer water at all our hydro power plants around the country where there has been issue and there was a drop of 428 million units from our hydro business, and in the Barmer plant there was the scheduled maintenance because of which 136 million units were down. With that, the total generation from the company during the quarter was 6.7 billion units.

In terms of the EBITDA, which was up by 18%, INR370 crores EBITDA additional came from Mytrah portfolio. Actually, the pro rata pro forma EBITDA for the quarter for Mytrah were INR370 crores, but two of our SPVs they got consolidated later part of the April month. because of that, INR30 crores is not coming into this. There is also, as I mentioned, because of Barmer as well as hydro, lower generation was there, but these two assets are under the long-term PPA. There is a INR80 crore EBITDA — lower EBITDA as compared to previous year, but this entire INR80 crore EBITDA will get include in the subsequent quarter. Because in the two part tariff PPA in our Barmer plant, we get our capacity charge based on 80% availability and we will be achieving the 80% availability, so this will get include. Similarly, the energy generation when we generate beyond the design energy, which we have been achieving all these years and which we will be achieving this financial year also, so the INR66 crore EBIDTA reduction as compared to the previous year in hydro and INR14 crores in Barmer both will get recouped during this financial year. The INR91 crore impact came because of the lower merchant sales because of the subdued demand in the month of April and May, but we are quite confident that the tariffs are quite robust and the spreads are also very good and during the rest of the financial year we will be achieving what we have budgeted and planned for in terms of the merchant sales.

In the country, we have been seeing the good trend for the solar generation. The CUF [Phonetic] for the country as a whole has been consistently improving. Our facilities both at Vijayanagar as well as Mytrah, they did exceptionally well. As compared to the P90 level, Vijayanagar solar plant generated 145 million unit as compared to P90 generation of 134 million units. Similar was the trend in Mytrah, we improved our plant availability by 70 basis points. And in Mytrah, first time, it generated 216 million units in the first quarter, which is as compared to 193 million units of P90 generation, so the Mytrah plant integration as well as the plant performance is better than what we had planned earlier.

Similar trend in the wind. In case of Mytrah, when we took over the assets in the month of March on 29th of March, the total machine availability was in the range of 85%, which has been improved and as I’m speaking the machine availability is 97.5%. And by middle of next month, we will be achieving 99% availability, which we have planned for. During the quarter, the total machine availability was improved by 680 basis points. And we generated 695 million units. There were total 80 turbines which were out of order. Right now, only two turbines are out of order and we are quite confident that the plan which we have envisaged for Mytrah in terms of the EBITDA improvement, as well as in terms of the total generation improvement, we are on track ahead of the schedule. The planned EBITDA of INR1,650 crores which we have guided for the next year, we will be seeing very encouraging trend during the current financial year itself and we will be increasing the trend and improving the trend expeditiously.

In terms of the project updates. The Ind-Barath performance is on the project integration is quite encouraging and quite good. We were planning to start with units by end of the financial year. I’m happy to share that we opened the turbines for the. maintenance as well as the boiler, we got very positively surprised with the condition of the plant and we are on putting the unit on bar within this month and with that transmission line and other things, we are expecting that by October or maybe in the current quarter itself, we will be commissioning the first unit. The second unit is also expected to get commissioned in the current financial year. So we are expecting that we will be having generation for one unit of 300 MW in the second half of the year, which will be improving our generation as well as our EBITDA profile going forward. We have already started participating in the auctions in the East Valley [Phonetic] and NCL. And some of the coal, we have already secured and balance where we are securing in due course of time.

Our update on Kutehr is quite good. We have already completed 98.5% or 99% of the tunneling and power house erection has already been started and it is moving as per the schedule. The recent rains in in Himachal Pradesh were disruptive because of certain land slides in and around our Kutehr project, but things are getting normalized and in next seven days’ time, we will be back to normal, and on our operating assets also in Himachal, there was no impact of the rains other than there was a preventive shutdown we had to take because of higher silt level which was there in the basin and — but the both plant as well as the people are absolutely safe and there was no impact whatsoever.

On our SECI projects, as of now, 150 MW is fully commissioned. We are on track what we have guided for and then all three sites, Karnataka, and two sites in Tamilnadu, they are — erection and commissioning is going on in full swing. In terms of the merchant market, which I touched upon in the initial remarks, which is looking quite attractive, the rates are also quite attractive. During the quarter, the rates were very good at close to INR5.5, the volumes were also up by 34% during the quarter and also going forward that is the demand trend and the prices we are seeing, as we are speaking in the monsoon months, we are seeing that these prices are close to INR5 to INR5.5 on an RTC basis which are quite remunerative for our company. And so we remain quite optimistic to recoup what we have seen a little blip as compared to previous year in the Q1. In the rest of the year, our merchant volumes will be quite good and same will be the spread.

Now I am asking Pritesh do take over and explain on the financial performance.

Pritesh Vinay — Director Finance, Chief Financial Officer

Thank you, Prashant. A very good evening to all the participants. Also, maybe I’ll take a leaf out of where Prashant stated about the overall generation. So if you look at the total net generation for the quarter was up by 14% at about 6.7 billion units. The total revenues for the quarter stood at just over INR3,000 crores, which was actually down by 3% Y-o-Y compared to a higher net generation because — primarily because you would be aware that for our common businesses, the fuel cost is a pass-through. So on a Y-o-Y basis, the coal prices have come down sharply and therefore from a pass-through point-of-view that reflects the lower tariffs and therefore lower realization. However, that is largely EBITDA neutral. So that is on the revenue side.

Prashant has already talked about EBITDA for the quarter stood at INR1,307 crores. I’d just like to spend a bit more on that. If you have access to our results presentation which was uploaded sometime back. And if you look at slide number eight where we’ve given an EBITDA bridge, it kind of captures what are the moving parts. Prashant mentioned that if you look at Mytrah portfolio as a whole, actually for the quarter, Mytrah assets delivered an EBITDA of INR400 crores. However, from a consolidation impact point-of-view, one of the SPVs got acquired on 6th of April and the second 150 MW SPV got acquired on 15th of June. So that is available only for the last 15 days in the quarter. So therefore, on a pro-rated basis from a consolidation accounting point-of-view, we’ve shown INR370 crores, but the underlying performance is actually INR400 crores. INR30 crores was the additional EBITDA that we got from the new solar project 225 MW as well as the SECI project 150 MW which were operational through the quarter.

Prashant did talk about the impact of lower hydrology at Hydro, which impacted generation. Hydro generation was down by 27% Y-o-Y. But in terms of EBITDA, that was a drag of INR56 crores. However, if you look at our past track record, as long as you are able to meet the design energy, which we have consistently done every single year for the 20-year and the 12-year operating track record at both Baspa and Karcham Wangtoo, we are able to recover this in subsequent quarters. Incidentally, while the PLFs were lower, the plant availability during the quarter stood at a very healthy 108% against normative requirement of 90% to recover the full capacity charge. Similarly for Barmer, due to planned shutdowns, the availability was lower and therefore there was — full recovery of capacity charge was not there. However, again like we have done for every single year in the past, this item is dependent on availability for the entire fiscal year, and we are very confident that like every single year in the past for the — in the remaining nine months, we will be able to get to overall availability and therefore I would like to see these INR50 [Phonetic] crores as more as timing mismatches, likely to be recouped in the remaining nine months of the year.

And of course, Prashant did talk about the impact of lower merchant sales, which was about INR90 crores. And of course fees and the O&M expenses etc. That was the bridge on EBITDA side. I’d like to also take a minute on explaining the finance cost for the quarter. If you look at the headline what was INR193 crores last year Q1 has landed at INR286 crores. So if you look at slide number nine where we have given a detailed bridge to explain the impact of that. INR170 crores is the incremental interest due to the tax on the Mytrah portfolio, which we had explained last time that was done at the time of acquisition. On account of very attractive refinancing and debt sizing that we have done, we prepaid the older lenders of Mytrah portfolio because of which there was a onetime prepayment for the refinancing impact of about INR40 crores. This is a onetime item, will not be recurring going forward in subsequent quarters. And the impact of additional debt due to Ind-Barath acquisition as well as the levering up of the common balance sheet that we are doing to fund our growth projects in the form of sponsors equity contribution that was a combined impact of about INR80 crores. So on a recurring basis, everything else remaining the same, the summer is likely to be more in the order of INR445 crores going forward, unless we lever up the thermal assets a bit more which will again get added.

So that’s on the finance cost bridge and therefore coming all the way down to the profit-after-tax for the quarter, on a headline basis, Q1 of last year, the profit after tax stood at INR560 crores. But last year first quarter, we have received repayment of a loan that was given to a third-party in the prior years and therefore that was an exceptional gain of INR120 crores, stripped off that, the underlying profit-after-tax for the first-quarter of last year was INR440 crores, again, this on the same slide number nine, if you look at the bottom portion, the PAT bridge explains in detail that how the Mytrah assets and the new renewable assets that we are adding added about INR85 crores at the PAT level on a combined basis. There was a roughly INR55 crores, INR60 crores drag due to the timing mismatch of the full capacity charge recovery at hydro and Barmer and likely to be recouped in the remaining part of the year, and the impact of Ind-Barath as well as the the one-time refinancing impact.

The merchant — lower merchant sales and profitability impacted our PAT on a Y-o-Y basis by almost close to INR100 crores. So that is the PAT bridge. The next number that. I would like to talk about is the leverage and the leverage profile. So, I request you to look at slide number 11, which shows the net debt movement on a sequential basis, so what has happened since March to June. You see that on the operating assets, which is the dark portion on the bottom portions of the chart, the net debt stood at over INR10,100 crores, this has gone up by almost INR160 crores quarter-on-quarter due to additional debt on the operating businesses. On the Mytrah portfolio actually the net debt has come down by about INR350 crores on a quarter-on-quarter because of as Prashant was saying all the higher generation due to better availability of machines, translating into higher EBITDA, and some working capital release in terms of liquidation of receivables. So therefore, the cash has gone up, there is some amount of debt repayment as well. And for the blue portion, which is the amount of debt that is sitting for capital work-in-progress which is likely to accrue revenue and EBITDA in future years, that went up about INR920 crores quarter-on-quarter to just over INR4,500 crores. So net debt. If you look at on the operating businesses, there’s about INR18,400 crores of debt sitting, which has been serviced by — on a normalized cash flow of close to INR5,300 crores, which translates to a net-debt to EBITDA on the operating business of 3.5x. This is consistent with the guidance that we have shared earlier with the markets as part of our Strategy 2.2 that when we pursue growth we would expect our sustained normalized net-debt to EBITDA to stand in the 3.5 to 4 times range.

If you look at slide number 12. This shows a bunch of metrics, but I’d just like to point out two, one is the top-right hand chart where we track the cash returns on the underlying business. So we continue to track at a more than 17% cash returns on adjusted net worth for the last several quarters. And if you look at the weighted average cost of debt excluding the Mytrah portfolio that stood at just about 8.5% and including the Mytrah portfolio is at about 8.7%. And the last number I’d like to talk about before I throw the floor open for questions is on the receivables. So if you look at slide number 13, on a year-on-year basis, the headline receivable number — sorry, on a quarter-on-quarter basis, the headline receivables have come down by 30%, but in terms of days sales outstanding, it is largely similar, it was 60 days in March, stands at about 58 days at the end of June. But the encouraging trend is this that the overdue proportion is coming down. The share of overdues are lower. As a matter of fact, in the first two weeks after the end of the quarter, there has been a strong collection. We’ve already received close to INR240 crores. And as we are speaking today the overdues are nil,

Similarly on the Mytrah portfolio, I’d just like to request you to look at slide number 60, six zero, where we’ve shown what’s happening with the Mytrah receivables cycle, where we have seen there is a very encouraging trend. If you look at the bottom portion, every month consistently what we are collecting vis a vis what we are billing, it’s between 125 percent to 200 percent of tax. So being that liquidation of receivables trend continues to be healthy.

So with that, I’ll take a pause and operator we’ll request you to open the floor for Q&A, please.

Questions and Answers:

Operator

Thank you very much. We will now begin the question-and-answer session. [Operator Instructions] We have a first question from the line of Mohit Kumar from ICICI Securities. Please go ahead.

Mohit Kumar — ICICI Securities — Analyst

Good evening, sir. Sir, congratulations on significant progress on our strong — the under-construction assets. My first question is on the EBITDA of Mytrah. I understand that this is a wind dominated portfolio and the first quarter seems to be a decent number. My question is, do you think that we are on target to achieve INR16 billion EBITDA in FY ’24 or do you think it will likely materialize in FY ’25 full-year?

Prashant Jain — Joint Managing Director and Chief Executive Officer

Thank you. Thank you for your question. So there the two aspects of it, one aspect is that putting the turbines on track and improving the availability of the assets. So what was envisaged to grow and reach up to 99% availability were by December 2023. As against that, I have already given guidance that as we are speaking, we see turbines are now and then by 15th of August, we will be at 99% of availability. So what we plan, we will be achieving five months or six months — five months ahead of schedule. So that’s part A. Same is the situation in terms of solar, and we had given a guidance that we will be achieving INR1,650 crores of EBITDA in FY ’25. So our guidance still remains INR1,650 crores for FY ’25. Current year, we are expecting that the — since majority of the wind season is up — or a part of the wind season will also be captured in during this year, we will be doing better than what we had planned originally. I think by if I — we have talked about [indecipherable] months’ time-frame EBITDA improvement, but I think we are reaching on achievement side close to six to seven months time frame, but some of the rain season is going away by the time all these things are there, but we will be doing better than what we had planned.

Mohit Kumar — ICICI Securities — Analyst

Second question is on the PSP. So have you financially closed that project? And have you broken the — have you started to work on that particular project. How many PSP sites are under our control in the sense the sites have been handed over to us?

Prashant Jain — Joint Managing Director and Chief Executive Officer

So we have already close to 9,000 MW of Pumped Storage Projects have been allocated to us. And of that, 80% of the projects we have already prepared the DPR, and then they are in a different stage of approval. And two of the projects we have already received the terms of reference. One of the project we have already completed EIA E&P and public hearing is also completed and then forest land accrual is in process and we are expecting that in the current financial year at least one project we will be starting the construction for which we will be doing the — taking the necessary approval and entering into a final PPA and thereby the financial closure and next year we are expecting two projects should go into that position by end of next financial year. So this is how it is there, so each project is at a different stage but one project will achieve all approvals and PPAs as well as other things to start the construction. And that will be the project, which we will be building for our Group Captive and which is within our steel plant where majority of the land and other things are also in place and there all EIA and E&P has been completed. The second project will be where we have already secured like LOIs on Government of Karnataka. And the third project is under the bidding stage and various approval stage.

Mohit Kumar — ICICI Securities — Analyst

My last question is, given that a lot of new projects where — lot of new tenders from SECI are coming RTC hybrid, we haven’t seen participating the solar bids. Do you think that our participation increased materially under the hybrid RTC, given that we have portfolio of projects we have which ideally more competitive?

Prashant Jain — Joint Managing Director and Chief Executive Officer

So we are looking at all bids and also the cost of doing the project and we are in the process of building the future pipeline beyond December 2025 because all the existing projects which are under commissioning will be over by December 2025, so we are now in the process of building the pipeline. We are evaluating the Group Captive requirement which we have decarbonization strategy for the JSW Group and we have received inbound queries from our JSW Group to evaluate and work on that as well as SECI bids. And then within that metric, we will be closing that pipeline in next one or two quarters, which will be filling up for FY 25, ’26, ’27 project execution.

Mohit Kumar — ICICI Securities — Analyst

Understood, sir. Thank you and best of luck sir. Thank you.

Operator

Thank you. [Operator Instructions] We have our next question from the line of Karan Gupta from [indecipherable] Capital. Please go ahead.

Karan Gupta — — Analyst

Yeah, thank you for the opportunity. I just wanted to check, so given the current seasonal rains, what does that imply for availability of water for your hydro projects for the coming quarter?

Prashant Jain — Joint Managing Director and Chief Executive Officer

They are running at 110%, all projects.

Karan Gupta — — Analyst

Okay. Good. And then on merchant power tariffs and the current coal prices which had crashed significantly, what are your thoughts for the next year?

Prashant Jain — Joint Managing Director and Chief Executive Officer

So we are making a good spread because the coal prices have also come down substantially, say, but when do you think is that post the monsoon period as the demand revives, it will be quite healthy and as regards to during even in the monsoon period, the current tariffs are very good.

Karan Gupta — — Analyst

So is there any sort of a conversion of coal prices to the margins that we generated on merchant power and is that something that you can share along those lines?

Prashant Jain — Joint Managing Director and Chief Executive Officer

No. I think what I’m trying to say that there is a positive spread based on the current executed coal prices as well as the prevailing merchant power prices. So [indecipherable] wise I think we are not concerned. We are more concerned about the demand per se in order to push more volumes. As the demand improves, there will be good money to be made into the merchant market.

Karan Gupta — — Analyst

Fair enough. And lastly, recently, there was an announcement that the UP government that is setting up new coal power plant. I think it was about 1.6 gigawatt. The pricing on that is really surprising. It was more than INR11 crores a megawatt. So, just wanted to get your thoughts on that.

Prashant Jain — Joint Managing Director and Chief Executive Officer

That’s for me to comment on it. We’re not anybody’s plan, but I think it takes anything INR4.5 crore to INR4.8 crores to INR5 crores per megawatt now, including the cost of FGD, and considering the cost of inflation. And the power prices, we’ve joined all new projects are also going to be close to north of INR4.5 and if you see the recent tender which has been done and concluded for the medium-term, the power tariff that have been discovered are in the range of INR5.20 to INR5.50 at best.

Karan Gupta — — Analyst

Thank you very much.

Operator

Thank you. We have our next question from the line of Anuj Upadhyay from Investec. Please go ahead.

Anuj Upadhyay — Investec — Analyst

Yeah, thanks for the opportunity, sir. Can you elaborate something on the green hydrogen project and also on the module manufacturing thing and I guess we have shifted the base from Odisha to some other state. Can you throw some light on that front, sir?

Prashant Jain — Joint Managing Director and Chief Executive Officer

We will be building this project in the State of Rajasthan, we have already identified the land and the proposal with the Government of Rajasthan for necessary incentives and other things are in final stages of approval. And also the plant and machinery negotiations are going on. The project is on track to be commissioned by March 2025. And as regards to the hydrogen project, preliminary work has already been started. Detailed engineering is going on and ordering of electrolyzers and commercial negotiations are — which is going on. We are on track to commission the project in the quarter ending March ’25. So both these projects will be commissioned by that time.

Anuj Upadhyay — Investec — Analyst

Okay, sir, and the offtaker for the green hydrogen would be our group company. Or we are also looking out for someone —

Prashant Jain — Joint Managing Director and Chief Executive Officer

We have already disclosed and declared after the Board approval of between JSW Steel and JSW Energy. This will be used for the making of the green steel. It is on a cost-plus basis, on a 15% ROE for the project for the seven-year contract and the total project cost as we amortize over a period of seven years. And post that, it will be materially disbursed.

Anuj Upadhyay — Investec — Analyst

Okay sir, lastly on the battery project which we have, I believe, 40% of that capacity is still open. So any guidance on that one sir whether we are looking for another long-term arrangement for that or we have identified short-term market.

Prashant Jain — Joint Managing Director and Chief Executive Officer

No, we are purposely keeping that in the short-term market at this point of time because we see quite a bit arbitrage. I don’t know whether you are seeing the trend in the market now. The fluctuation between the off time and the peak time power prices is anywhere between INR4 and there is another ancillary market for the [indecipherable] management also wherein there are certain incentives for the battery projects. We believe that — so some more time there will be a huge opportunity for money to be made in this particular segment. However, we are also mindful about if there are any great opportunities we can work in that capacity, but we see that it will be quite [indecipherable] at this point of time. It is a similar situation like Ind-Barath, I have so many inbound calls for doing the long-term PPA from Ind-Barath, but we don’t want to give the PPA at this point of time. We want to keep the capacity open in the merchant.

Anuj Upadhyay — Investec — Analyst

Thank you, sir, if you will, please allow me to chip in another question, sir. It’s related to the new capacity. So like we already have a lot of I mean SECI [indecipherable] X which is to be scheduled here, but considering the fact that the government has mandated around 50 gigs of renewable capacity to be [indecipherable] current fiscal, are we aggressively looking into this side of project or the time-being, we are focused largely on the pump hydro [indecipherable].

Prashant Jain — Joint Managing Director and Chief Executive Officer

So, I believe you are aware about our Strategy 2.0 wherein we have very categorically talked about that how we are achieving the capital expenditure every year and also we are talking about the capacity addition, in my comments to a previous caller I have explained that close to December ’24, we are now building the book in between the Group Captive as well as various other opportunities. There is a certain amount only we can do that as a capital expenditure every year due to availability of capital as well as the execution, which is possible because of the connectivity as well as resources which are available with us. So we are trying to balance out considering the maximization of our returns. So we are carefully selecting the options and opportunity so that we make best possible ROEs and equity IRRs. So this is what we are doing. And in next one or two quarters, you will see, we are building the book which is beyond December ’24 and you will get a visibility of another 4 to 6 gigawatts will be built over a period of next three years beyond December ’24 and March ’25, so we will get the visibility up to ’27, ’28.

Anuj Upadhyay — Investec — Analyst

Fair point, sir. Thanks for the opportunity and wish you best of luck.

Operator

Thank you. [Operator Instructions] We have our next question from the line of Shreyans Daga from Barclays. Please go ahead.

Shreyans Daga — Barclays — Analyst

Hi, thanks. Thank you for my question, so I know you answered a question on hydro projects, but specifically there was a media report that Karcham Wangtoo and Baspa two have been closed due to the floods in Himachal. So can you give us some light on the two projects?

Prashant Jain — Joint Managing Director and Chief Executive Officer

So there were no floods, basically you need to understand every year during this time when the rain happens or cloud burst happens, because these were –these particular basins is having — is coming from [indecipherable] and If you have been to that site, then it is purely about the sand mountains. because of which the sand level or silt level grows up into the water and as a precaution there is a great growth, the movement the sand level goes beyond 5,000 to 6,000 [indecipherable] all the plants open their gates and then they go in auto flush mode so that there is no impact on the turbine. It happens irrespective of the heavy rains, it always happens during this time. So the units were down for 72 hours approximately. And then the movement the silt level went down to permissible limit, they all started running and all of them are running in a full load at 110% load, and as I said that good asset as well as the people everybody safe and there is no disruption of whatsoever whether temporary or permanent, in case of Kutehr, because of the land slide, there is a little bit of disconnectivity which has been restored, some of the connectivity has been restored balance into the in next three to five days which will become normal.

Pritesh Vinay — Director Finance, Chief Financial Officer

So Shreyans, to be specific, if I may add, as Prashant mentioned,, you know, the Baspa units went on full load as of 3:30 PM yesterday and Karcham and Wangtoo all the four units went into full load at 5 PM yesterday, so prior to that for 72 hours we had an upgrade and safety, etc point-of-view, due to-high silt levels, they were shutdown. Yeah.

Shreyans Daga — Barclays — Analyst

Okay, okay, thanks, that’s all.

Operator

Thank you. We have our next question from the line of Manas Arora from Dinero Wealth. Please go ahead.

Manas Arora — Dinero Wealth — Analyst

Hello, good evening, so I have question about wind energy. Sir. I wanted to know, are we planning any further capex into wind energy, apart from our under-construction projects?

Prashant Jain — Joint Managing Director and Chief Executive Officer

Yeah, as I said that we are — we have planned to do close to 1.5 to. 2.3 gigawatt of the project every year and beyond December ’24, we have to build a book, we are absolutely in comfortable position to build that book. As I said that there is a group captive requirement of close to 5 to 6 gigawatt to be built over a period of next three, four years timeframe as well as there are other opportunities that we are heading in terms of the hybrid and other SECI bids. So we are carefully evaluating and seeing that equity IRRs where we can maximize our return and in next two quarters, we will build book beyond ’25 and you will see that thing happening and there will be a complete visibility of that book, which will be executed. You know that we have been always talking about that we don’t build the book well in advance, which cannot be executed over a period of next 24 to 30 months time frame. we build the book only when we can execute immediately. So this is how we have been, because most of the time, if you are building the book ahead of the schedule, and then you are forced to compromise on your returns and that’s what we have not been doing and we had been very picky and choosy about it, so there will be a book you’re going to be seemed to the build in next one or two quarters.

Manas Arora — Dinero Wealth — Analyst

Sure sir, my next question is, are we going to participate in SECI 2.5 gigawatt tenders, the build ones?

Prashant Jain — Joint Managing Director and Chief Executive Officer

So we are we are mindful of the tariffs. We have seen encouraging tariffs in the recent time and we are seeing that the module prices are also going down and then it’s quite encouraging, so we will balance out, because we want mid teen to-high teens kind of returns and that’s what we always look for.

Manas Arora — Dinero Wealth — Analyst

Okay, thank you so much. And that’s all from my side.

Operator

Thank you. We’ll take our last question from the line of Chirag Kachhadiya, an Individual Investor.

Chirag Kachhadiya — Individual Investor — Analyst

Hello. Due to the disturbances in Northeast side, what impact in the generation we are expecting?

Prashant Jain — Joint Managing Director and Chief Executive Officer

Nowhere impact now. Whatever were supposed to happen has happened. Now the demand is also picking up and as compared to the last year the July demand as of now for the month as a whole is close to 5.5% up.

Chirag Kachhadiya — Individual Investor — Analyst

Okay and sir. I wanted to understand about the battery, the storage business in which we forayed recently. So can you certain basic understanding like what. It mean to be later on for our company. And what is the potential of that business?

Prashant Jain — Joint Managing Director and Chief Executive Officer

Storage is a big opportunity for to be built upon, as per CEA by 2030. In order to manage the grid we are in 500 gigawatt of renewable capacity will be there. We need 320 gigawatt hour of the present storage capacity, which will be met by both the assets as well as GST on storage projects and which talks about 1,620 gigawatt-hours or six hours storage, which means we are talking about close to 50,000 MW capacity and so we see this is a great opportunity for JSW Energy and we have ventured both BSS as well as TFC segments and both segments with what the first standard with us. And so it’s quite encouraging and we have got a large resource pool and we will be growing our company in this particular segment going forward.

Chirag Kachhadiya — Individual Investor — Analyst

And sir, what capex we incurred for this venture?

Prashant Jain — Joint Managing Director and Chief Executive Officer

Depending upon the capacity typically if you are building the complete storage project anything between. INR3.85 crores per MW to INR7 crores per MW depending upon the configuration of the project, size of the project, location and the storage capacity. So this is how this projects are built and typically 5.5 hours to 8 hours of the storage capacity and 75% to 85% of the efficiency. With regards to the battery project, it depends on the battery prices. And anything between USD300 to USD400 per kilowatt-hour of the system cost at this point of time, which will be certainly going down to USD150 to USD300 going-forward over a period of time and battery prices goes down.

Chirag Kachhadiya — Individual Investor — Analyst

Thank you so much. All the very best.

Operator

Thank you. I now hand the conference over to Mr. Sudhanshu Bansal from JM Financial for closing comments.

Sudhanshu Bansal — JM Financial — Analyst

Thank you so much to the management of JSW Energy for giving us the JM Financial the opportunity to host the call. I thank all the participants for attending this conference call. Sir, if you would like to have — give any closing remarks?

Prashant Jain — Joint Managing Director and Chief Executive Officer

Thank you, Sudhanshu, and thank you everyone. In case there are any follow-up questions, please feel free to connect with our Investor Relations team and they will be happy to clarify everything. Thank you, again.

Sudhanshu Bansal — JM Financial — Analyst

Okay, thank you very much and happy weekend to all of you. Thank you. We can close the call.

Operator

[Operator Closing Remarks]