CEO AND MD’S MESSAGE
Being proactive. Staying resilient.
The year 2020 was fraught with multiple challenges and an uncertain global outlook. Yet, we collectively stood strong in the face of adversity, demonstrating resilience, innovation and agility across the organisation. As a purpose driven Company, we tapped into all our resources and capabilities to produce actionable impact for our stakeholders and help combat a profound health and humanitarian crisis. The road ahead is clear and we are committed to achieving equitable growth that makes a positive difference to our people and our planet.
Dear Stakeholders
The year 2020 has been like no other before in living memory, characterised by extraordinary challenges. However, it has also been a year in which we recommitted ourselves to our vision of providing future ready energy solutions to our customers to empower them for tomorrow’s world. Our employees and partners were not discouraged by our strategic business objectives and meeting the evolving requirements of our customers. As India went into one of the world’s largest COVID-19 lockdowns, our employees ensured uninterrupted electricity supply across the country. We proactively adopted strategic measures to combat the adverse impacts across our operations, workforce, and communities. Despite downside risks posed by COVID 2.0, we remain cautiously optimistic and will continue to build a resilient tomorrow and advance our sustainability agenda.
Building future-ready solutions
In FY21, we took effective steps to de-leverage our balance sheet. This strategy resulted in greater investor confidence in our performance and our market capitalisation increased by 214% from ₹10,496 crore in FY20 to ₹32,990 crore in FY21. Furthermore, we raised ₹2,600 crore by way of issuing equity share capital on preferential basis to Tata Sons Private Limited ("Tata Sons") reinforcing their commitment to strengthening our Company’s financials by increasing their shareholding from 35.27% in FY20 to 45.21% in FY21. The completion of sale of the South African assets, shipping assets as well as defence business and the consequent reduction in debt and a corresponding upgrade in credit ratings has enabled the Company to further reduce financing costs. This has accelerated our ambitious plans to expand our business portfolio across renewables, transmission and distribution, as well as customer centric businesses of Solar Rooftops, Solar Pumps, Microgrids, EV charging, Energy Services (ESCO), Home Automation and Floating Solar, amongst others. Your Company achieved a major strategic milestone by winning bids in the privatisation of the Discoms in Odisha. This has expanded our operational footprint and increased our customer base in distribution to 12 million customers.
In line with India’s Nationally Determined Contributions (NDC), we have furthered our vision for a sustainable tomorrow with our commitment to achieving Carbon Neutrality before 2050. We are increasing our efforts in this direction with our commitment to set emission reduction targets in line with the Science Based Targets initiative (SBTi). Additionally, we plan to phase out coal based capacity and expand our clean and green capacity to 80% by FY30. As India’s largest integrated solar EPC company, we delivered strong performance in FY21 with Tata Power Solar’s order book over ₹8,700 crore and a capacity of around 2,800 MW. This achievement also strengthens our position as the No. 1 Solar EPC player for seven years in a row. As of date, we have five renewable projects registered under the Clean Development Mechanism (CDM) programme by United Nations Framework Convention on Climate Change (UNFCCC). It is noteworthy that 87,351 Certified Emission Reductions (CERs) were traded from these projects in FY21, generating around ₹1.77 crore gross revenue. #Futureready for a cleaner tomorrow, we aim to capitalise on opportunities across hybrid and offshore wind projects, floating solar, hydrogen fuel and strengthen our partnerships for battery storage projects.
We believe, a key step towards our transition towards carbon neutrality is to make sustainable products and services more affordable and accessible to our customers. This will enable us to strengthen our current stakeholder relationships and expand a suite of products and services that make our business more resilient as we move into the next decade of sustainability. With a deeply entrenched customer centric strategy, we continue to leverage innovation and technology to develop affordable and low carbon energy solutions for our customers. We also continued to strengthen our investments in SMART grid technologies to ensure an efficacious and resilient network as well as identified opportunities to transition towards an Energy as a Service (EaaS) business model. Strengthening our position as a B2C company, we continue to leverage smart choices to light up the lives of our customers in a more sustainable manner.
Driving valued impact, we stand by our responsible procurement practices across the value chain. We are committed to local sourcing and increased ESG transparency with our Business Associates (BA). We also encourage local businesses with 99% of non-fuel procurement locally sourced in FY21. Additionally, 46% of our overall procurement budget, including fuel was spent on local suppliers. We thus aim to minimise any adverse environmental and social impacts across our value chain.
“Despite downside risks posed by COVID 2.0, we remain cautiously optimistic and will continue to build a resilient tomorrow and advance our sustainability agenda.”
Energised by our teams to deliver impact
Caring for our people and the communities we work with is deeply ingrained in our core values. We focus on upskilling and reshifting our teams across functions and businesses to enhance innovation, enable positive impact and light up the lives of our customers across the nation. We remain committed to fuel each and every employee’s passion, hone their inherent talents and empower a diverse and inclusive workplace. In FY21, we continued to advance diversity and inclusion across our businesses and leadership. By enabling supportive gender diversity policies, women at Tata Power represent 8% of our total workforce in FY21. Additionally, women represent 31% of selected candidates in FY21 across campus recruitment.
With workforce mobility and employee well being a critical issue in FY21, we further strengthened our Business Continuity Plan (BCP) in response to the COVID-19 pandemic. This enabled effective operational preparedness and proactive measures to ensure the safety of our employees, while they worked hard to keep the power on in each and every home. Even during these unprecedented times, our employees remained steadfast in our vision to ensure sustainable, affordable, and innovative energy solutions for all our stakeholders. Their support enabled us to accelerate our own transformation to a new energy world. To enable a seamless transition to the new work from home paradigm, we leveraged on various training modules and programmes to bolster digital transformation across the organisation.
We continue to build deeper partnerships with our stakeholders and drive positive impact across communities. Bolstering our Corporate Social Responsibility (CSR) vision and thrust areas, we aim to positively impact 30 million lives directly and through the enabling community institutions around the regions we operate in. In FY21, our CSR expenditure stood at `39.24 crore with around 17,000 employees volunteering 57,257 hours to enable positive impact across communities. Furthermore, all our CSR initiatives are aligned to the United Nations Sustainable Development Goals (UN SDGs). We also encouraged inclusivity across our CSR interventions with 56% of our CSR beneficiaries being women in FY21. In our endeavour to transform India’s rural landscape, we continued to install microgrids across 200 villages, with value added services implemented for our rural customers, including EMI schemes, Energy Efficient Applications and Micro Financing Institute (MFI) linkage for commercial and industrial customers.
Going beyond our thrust areas, we continued to work relentlessly to support responsible citizens in augmenting energy and resource conservation across the country. Owing to the pandemic, we could not conduct on ground programmes but capitalised on digital platforms to introduce ‘E-learning Fridays’ and bi-weekly webisode series for children and their parents. These efforts encouraged people to adopt sustainable living practices amid the lockdown with a successful 35,000 views across the webisode series.
Transforming sustainably to empower millions
We will continue to draw on our collaborative spirit to transform and ensure the resilience of our Company through new challenges in the coming years. There is much to do and we have a clear direction and a strategy for the future. I have strong faith in our leaders and employees, who continue to effectively execute strategy and deliver sustainable value to all our stakeholders.
Before I conclude, I must extend my heartfelt gratitude to all our gogetters-frontline workers who overcame challenges posed by the pandemic to ensure uninterrupted power supply to millions of citizens across the country. We will continue to focus on sustainable growth while delivering future ready solutions to our customers and empowering the nation.
Yours sincerely,
Dr. Praveer Sinha
CEO & MD
The Tata Power Company Limited