Installing 500 GW of non-fossil fuel-based energy capacity by 2030 is thought to depend on raising funding for the sector, and another public sector company has joined India's renewable energy financing scene.
The government-owned Indian Railway Finance Corporation (IRFC), which has been the Indian Railways' primary funding arm since 1986, is now branching out into industries like transmission and power generation that have both forward and backward connections to railroads.
IRFC recently prevailed in a proposal to give NTPC Green Energy a rupee term loan of ₹75 billion, or around $861 million. Opportunities to finance metro rail projects and Indian Railways' renewable energy requirements are being aggressively investigated by the financial corporation. Additionally, it is funding ₹31 billion (about $35.58 million) to NTPC's thermal power producing division.
The public sector lender now has greater operational and financial autonomy thanks to its "Navratna" status. Additionally, IRFC and REMC have teamed to finance renewable energy projects that REMC has granted to power the railroads.
The renewable energy industry is actively lent to by government-owned organizations such as Power Finance Corporation, REC Limited, and Indian Renewable Energy Development Agency, in addition to Indian and international commercial banks.
The IRFC's campaign for financing for renewable energy comes weeks after Pralhad Joshi, India's minister of new and renewable energy, stressed at a workshop how crucial it is to raise money to reach the country's clean energy target. According to estimates, up to ₹30 trillion (~$365 billion) in debt will be needed to develop 500 GW of renewable energy capacity by 2030.
Joshi also called for that banks and other financial entities be required to finance renewable energy. A similar suggestion was made in 2023 by the Parliament's standing committee on energy, which suggested that bankers give a certain portion of their funding commitments to the Indian renewable energy industry.
The committee recommended that MNRE endeavour to make novel financing methods such as infrastructure development funds, infrastructure investment trusts, green/masala bonds, and crowdsourcing available for the renewable energy sector, characterizing the current financing gap as "gargantuan."
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