The FINANCIAL -- As part of its efforts to scale up private sector-led infrastructure development in Asia and the Pacific and boost support for clean energy, the Asian Development Bank (ADB) approved a new $390 million financing package for ReNew Power to develop renewable energy projects in India.
The financing will assist 7 special purpose vehicles owned by ReNew Power, the first of which has also been signed, according to ADB.
This is the first transaction to include in its financing plans resources from ADB as well as Leading Asia's Private Sector Infrastructure Fund (LEAP). LEAP is a funding arrangement provided by Japan International Cooperation Agency (JICA) and is administered by ADB.
“We strongly believe in ReNew Power’s potential and execution capabilities,” said Michael Barrow, Director General of ADB’s Private Sector Operations Department. “The company has shown tremendous growth over the last few years and we are pleased to provide a further boost to help it bridge the gap between India’s current and growing energy needs and to reduce the country’s carbon footprint.”
With the financing, ReNew Power will develop photovoltaic solar power projects with combined capacity of 398 megawatts (MW) in Jharkhand and Telangana, and wind power projects with combined capacity of 311 MW in Andhra Pradesh, Gujarat, Karnataka and Madhya Pradesh.
Combined, the projects are expected to generate 1,400 gigawatt hours of electricity and help avoid nearly 1.2 million tons of carbon dioxide emissions per year. The plants will be commissioned by December 2017. The generated electricity will be supplied to respective state power distribution companies under long term power purchase agreements.
ReNew Power, an independent power producer (IPP) company, generates reliable and efficient non-conventional power through over 3,000 MW of commissioned and under-construction clean energy projects across 15 states in India.
ADB has been supporting the development of renewable energy in India since 2007, when it financed the first set of wind projects. ADB has subsequently financed solar IPPs by assisting projects under the National Solar Mission and various state policies. As part of the commitment announced by ADB in September 2015 to scale up climate change financing to $6 billion a year by 2020, ADB will seek to sustain its private sector activities, particularly in major renewable energy markets such as India.