IREDA—Green Power House
In 2015, the Government of India ramped up its target for solar energy five-fold – from 20 GW to 100 GW. Of this, 40 GW is to be added under the solar park scheme.
In 2015, the Government of India ramped up its target for solar energy five-fold – from 20 GW to 100 GW. Of this, 40 GW is to be added under the solar park scheme. To help India establish large scale solar parks, the World Bank is providing the Indian Renewable Energy Development Agency (IREDA) with US$100 million in financing under the ‘Shared Infrastructure for Solar Parks Project’. The project, being implemented under the Ministry of New and Renewable Energy’s Solar Park Scheme, is currently helping establish the Rewa Ultra Mega Solar Park and the Mandsaur Solar Park, which will have a cumulative capacity of 1,000 MW. Funds will be invested in the parks’ common (or shared) facilities such as the transmission evacuation system, etc. Other potential solar parks are to follow.
The World Bank Group has also deepened its engagement in the Rewa Ultra Mega Solar Park through the role played by the International Finance Corporation (IFC) as the park’s transaction advisor. The IFC has helped the solar park developer (Rewa Solar Ultra Mega Limited (RUMSL) to develop an innovative business model that offers a “plug-and play” facility to investors. This has instilled confidence in private developers and helped reduce costs, which was reflected in the landmark low tariffs that were bid for the facility. RUMSL is a joint venture between Solar Energy Corporation of India Limited (SECI) and Madhya Pradesh Urja Vikas Nigam Limited (MPUVNL), the state nodal agency of Madhya Pradesh.
Since the availability of clear land is one of the major factors in attracting international players to a country and a project, the World Bank is also helping make such investments more robust. In the Rewa solar park, for instance, the World Bank’s presence during the planning phase enabled RUMSL in adhering to environmental and social norms at international standards. Since the due diligence on the safeguards was very deep, developers were able to mitigate the risks around land and attract international investors, bringing down tariffs.