Months after committing a line of credit amounting to 150 million euros for 15 years to fund solar energy and solar solutions in the country, the European Investment Bank (EIB) now seeks to extend four times the credit to expand offshore wind initiatives in India.
A fund of close to EUR 600 million has been earmarked by the European funding agency for this purpose. In India, the EIB would be joining hands with State Bank of India and YES Bank.
EIB, the largest funding agency on renewable energy globally, said in a statement on Friday that it will increase the support for onshore wind investment through expansion of an existing lending programme with the State Bank of India, has approved a new credit line with Yes Bank to accelerate private investment in wind and solar projects, and expects to work closely with Indian partners to support offshore wind projects.
The clean energy financing was confirmed by EIB officials at the inaugural of an offshore energy investment conference, organised by the agency, in New Delhi.
"We look forward to broadening cooperation with Indian partners to support new renewable energy projects in the months ahead and enabling offshore wind to contribute to clean power generation in the country," said Andrew McDowell, vice president of the EIB.
"India has huge renewable energy resources and harnessing India’s abundant natural resources is crucial for sustainable development. Supporting energy investment is a key focus of the European Union’s India strategy announced this week and my colleagues are working closely with Indian partners to further develop India’s offshore wind sector," he said.
With this EIB line of credit, technical support, too, would be available for India from the European Union, Bank of Europe and other European agencies, said Tomasz Kozlowski, European Union Ambassador to India. Europe has the most advanced technologies in renewable energy harnessing and is a large seller of renewable energy equipment globally.
The EIB has a project portfolio of more than 7 billion euros invested in renewable energy sector across the globe. Sharing from this huge global experience, it now seeks to unlock investment in Indian offshore wind sector.
During its conference in the capital, EIB would be engaging with government officials, policy experts, business leaders, project promoters and finance professionals engaged with the renewable energy sector in India.
Technical experts from the EIB highlighted how the public sector can accelerate the deployment of innovative renewable energy technology. They identified infrastructure, skills and financial mechanisms that have enabled offshore wind to become a key source of clean energy in a number of European countries.
Under the agreement signed on Friday between the EIB and the two banks, promoters of onshore wind projects will be able to benefit from long-term low-cost financing under a dedicated EUR 600 million renewable energy financing programme.
The EIB said that in preliminary discussion with promoters of renewable power projects, it has already identified several beneficiaries who can avail their scheme in several Indian states.
Last year, the EIB and the Yes Bank had identified solar power projects and wind farms across India that will benefit from a dedicated renewable energy credit line, backed with EUR 80 million of EIB financing. This year, a second round of financing for a renewable energy credit line is currently being finalised and expected to be rolled out in the coming months.
Earlier, the government's attempts to auction for hybrid solar-wind power plants onshore had yielded limited participation from project developers, with only one developer participating in the auction conducted by the Solar Energy Corporation of India (SECI).
Existing onshore wind projects in the country, in several states like Karnataka and others, are also facing problems as cheap solar power availability has forced them to sell power to state discoms at a reduced rate. Prime Minister Narendra Modi's initiative to form the International Solar Alliance (ISA) was also appreciated at the EIB conference.