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New Delhi: Public sector banks (PSB) are likely to finance about ₹10 trillion to renewable energy projects in the country by 2030 to help India achieve its energy transition goals.
Speaking at the India Energy Transition Summit (IETS) organized by FICCI, M. Nagaraju, secretary to the department of financial services, also highlighted issues such as delayed payments which impact the growth of the green energy space.
“The requirement is ₹33 trillion by 2030, but only from the public sector banks, we will be able to meet about ₹10 trillion by 2030 and the remaining ₹23 trillion has to come from other sources. That’s what the country needs to look at,” Nagaraju said.
India aims to achieve 500 GW of non-fossil power generation capacity by 2030
He also said that the government is looking at innovative ways to fund green projects and the need to develop the bond market for long term financing to renewable energy projects.
“We need to develop the bond market. When the bond market is available long-term financing to the RE sector should be available. This is where I think industry need to see how we can actually develop the bond market.”
Speaking on delayed payments, he said: “Main thing is delayed payments by the people (distribution companies) who signed power purchase agreements (PPAs). That’s one issue that is a risk for business and financial institutions to fund. The other is delayed land acquisition. Also, infrastructure evacuation for the power generated.”
Addressing the event, Union minister for new and renewable energy Pralhad Joshi said that India is leading the global energy transition with “unprecedented speed, scale, and scope”.
Power demand
As India’s energy demand is expected to double by 2032, the union minister highlighted the need of higher renewable energy financing to meet 50% of expected rise in demand through renewable energy. Joshi also said that the ministry is working towards ironing out the bottlenecks in renewable energy sector by engaging more with stakeholders.
He also said that India has now overtaken Brazil to become the third-largest renewable energy market globally.
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