“As a prime mover, IREDA has shown the way to peers”
The Indian Renewable Energy Development Agency (IREDA) is a non-banking financial institution headed by its CMD, Mr K S Popli. Overall,
IREDA has grown from strength to strength and is on an exponential growth trajectory.
• The loan sanction has grown from Rs. 826 crore in 2007-08 to Rs. 10199 crore in 2016-17.
• Loan disbursement, has also followed lead with loan sanction and has grown from Rs. 553 crore in 2007-08 to Rs. 6593 crore in 2016-17.
On June 7, 2017, the Government approved Initial Public Offer of IREDA to issue 13.9 crore fresh equity shares of Rs.10 each to the public on book-building process. The proposed IPO issue of 13.9 crore fresh equity shares to the public would increase IREDA’s equity base, which will help in raising more debt resources for financing RE projects. This will also increase IREDA’s visibility in domestic and international financial markets.
On innovating in IREDA’s financing strategy…
IREDA has been constantly developing new and innovative products for the renewable energy sector. In the recent past, IREDA has launched several new schemes for catering to RE market, for instance:
• Scheme for Solar Roof Top through Aggregator (RESCO) to promote rooftop solar photovoltaic (PV) power projects,
• Scheme for discounting of Energy Bills to address the issue of delay of payments by DISCOMs,
• “Credit Enhancement Guarantee Scheme” for Renewable Energy Projects to enhance the credit rating of the proposed bonds by way of unconditional and irrevocable partial credit guarantee, etc.
• Loan scheme for “Access to Energy” projects under KfW Line of Credit.
On changes in India’s renewable market…
The landscape for renewables in India has been changing fast. Some of the notable changes are:
• Renewable energy market has become mature.
• Government’s ambitious target and favourable policies have brought about a tremendous change.
• Entry of International players to the RE in India.
• The cost of Solar PV has reduced very fast.
• The cost of setting up solar power project has come down from INR 8 Crore to INR 4 -5 Crore now.
• The tariffs have come down below the cost of conventional power.
RE Project financing has come a long way from conventional balance sheet financing to stand alone financing on non-recourse mode in last few years. Growth of IPPs has also played an important role for scale up in RE investments. Large scale Renewable energy projects are being funded in consortium/co-financing mode with multiple Banks/FIs.