IREDA Seeks Global Partnerships to Lower Green Finance Costs
Indian Renewable Energy Development Agency Ltd plans to partner with global banks to reduce borrowing costs for domestic renewable energy developers.
The Indian Renewable Energy Development Agency Ltd (IREDA) is seeking partnerships with global banks, institutional investors, and multilateral organizations to secure cheaper, long-term green funding for domestic companies. Speaking at the Bharat Renewable Energy Summit, Executive Director Tusarkanta Parida stated the initiative aims to provide finance at more competitive rates to ease the burden on developers.
Currently, Indian renewable energy developers face borrowing costs between 11% and 12%, a sharp contrast to the 2% to 3% rates common in developed markets. This funding gap is critical as India requires an estimated $220 billion over the next three years to achieve its target of 500 gigawatts of non-fossil fuel power capacity by 2030.
Beyond the cost of capital, the industry faces systemic hurdles including land acquisition difficulties and inadequate transmission infrastructure. Kailash Vaswani, Chief Financial Officer of ReNew Energy Global, noted that these infrastructure gaps lead to power curtailment, which disrupts the cash flows necessary for developers to meet debt repayment obligations.
