Govt seeks multi-billion dollar funds for solar power project

The government, which has set an ambitious target of growing India’s solar power capacity 40-fold in 10 years, is in the process of tying up a multi-billion dollar assistance from international funding agencies such as World Bank, German development bank KfW.

The government, which has set an ambitious target of growing India’s solar power capacity 40-fold in 10 years, is in the process of tying up a multi-billion dollar assistance from international funding agencies such as World Bank, German development bank KfW.

Solar power plays a major role in the government’s promise to provide 24x7 power in the entire country. At present, it has a miniscule 2,500-mw share in the total installed power generation capacity of close to 250,000 mw.

To take this to 100,000 mw of installed solar power over the next 10 years, it would need funds to the tune of Rs. 6 lakh crore or $100 billion. Immediately, the solar capacity would be doubled to 5,000 mw within 2014-15.

“Talks are on at the highest level in the goverment with leading international funding agencies to roll out this initiative...steps are also afoot to attract investors through a suitable policy for setting up solar power projects in India,” a senior government official told HT.

He said talks have been held with the World Bank, and negotiations are also on with German development bank KfW for a soft loan of over one billion euros (Rs. 7,700 crore).

“A programmatic engagement is underway with funding agencies on solar sector supporting government’s initiatives announced in the budget on ultra mega solar power projects and solar parks,” officials said.

These would be done through a long-term partnership with Solar Energy Corporation of India, focusing on three dimensions: supporting ultra mega solar power plants through long tenure financing, beginning with 750 MW in Madhya Pradesh; large scale 100 MW rooftop decentralised solar power through partnerships with agencies such as Airport Authority of India, Railways and Warehousing Corporation of India; and by setting up five solar parks.

States such as Rajasthan, Uttar Pradesh, Telangana, Gujarat, Andhra, Karnataka and Madhya Pradesh have been identified to set up big solar power projects.

“Credit has to come. Capital has to be made cheaper. A proper policy will help attract investors. We aim to produce 100,000 mw,” secretary of new and renewable energy, Upendra Tripathy said at an event recently.

Tripathi has said the recent US visit of Prime Minister Narendra Modi could see investment pouring into this sector. World Bank president Jim Yong Kim had met Modi on July 23, and 24x7 power supply was identified as priority area for World Bank support. Bank officials are already in touch with Indian officials.