An agreement will soon be consolidated between Indian Renewable Energy Development Agency (IREDA) and banks from Japan and Germany. The agreements will provide India with $630 million of loans for the implementation of renewable energy projects.
IREDA was founded in 1987 by the Ministry of New and Renewable Energy for the function of providing finance for renewable energy projects in India. The prime objective of the body is to provide competitive loans for energy-efficient and renewable energy power plant projects.
In February, the German KFW bank will most probably accept to offer $260 million in soft loans to India’s renewable projects. In addition, the Japan International Cooperation Agency is likely going to seal a deal to provide $360 million in soft loans to IREDA.
There are ambitious renewable energy goals that have been outlined by the Indian government. They are going to initiate a radical growth in clean energy technology over the upcoming decades. This includes the expansion of solar, wind, small-hydro, and waste-to-energy projects.
The prime plan for the expansion in solar energy is explained under the National Solar Mission. Moreover, the National Mission on Enhancing Energy Efficiency is also given critical emphasis to reap industrial energy efficiency.
In addition to the soft loans that will be provided through IREDA, the government offers subsidies for clean energy projects. The subsidies are provided in terms of premium tariff rates, generation-based incentives, tax benefits and henceforth. Projects fostering innovation and development of clean technology and products are equally provided with tax benefits and subsidies.
Recently, IREDA funded the off-grid rural electrification program as well as the distribution of solar lighting systems to deprived families. Currently, for this year, $425 million worth of loans has been secured by the agency. This represents an increase of 26 percent in loan values since last year.
In addition, the positive investment policies promoted by the Indian government are encouraging international investors to push the renewable energy industry to new heights. But, investors have even more to gain. Apart from the strong benefits initiated by the Central government, various municipal and state governments are providing extra incentives to local and international investors.
The US Import-Export Bank is also showing interest in providing loans to large-scale renewable energy based-plants projects in India. Last year, The Nordic Investment Bank and French Investment Agency provided $120 million in loans to the IREDA.
Source: Clean Technica