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USAID, DFC announce $41 million financing for renewable energy in India

The US Agency for International Development and US International Development Finance Corporation announced a $41 million loan-guarantee program to finance investment in renewable energy by Indian SMEs

Topics
renewable energy | SMEs | India

Press Trust of India  |  New Delhi 

Renewable Energy, solar, wind, clean, green
Solar and wind energy farm

The United States Agency for International Development (USAID) and the US International Development Finance Corporation (DFC) have announced a USD 41 million-loan guarantee program to finance investment in solutions by Indian

"USAID and DFC are jointly sponsoring a USD 41 million loan portfolio guarantee to help finance investments by Indian small and medium enterprises (SMEs) in solutions, including rooftop solar installations. These loans will enable to access reliable power and cut costs," a statement said.

USAID/India's Acting Mission Director Karen Klimowski stated, Investments in solar solutions, secured by these credit guarantees, will improve access to clean, steady, and affordable energy as well as further progress towards India's clean energy transition and climate change mitigation.

India's commercial and industrial sectors pay high fees for their electricity, making rooftop solar a sustainable, cost-saving investment, but and residential consumers face obstacles in securing the financing needed to install and use rooftop panels, as per the statement.

SMEs account for 48 per cent of the total energy consumed in India's industrial sector.

Rooftop solar power generation offers a win-win, it said, adding that lower monthly energy costs drive important social benefits, including job creation and economic growth, while reducing carbon emissions and improving air quality.

USAID and DFC partnered with the New York-based Encourage Capital, an environmentally focused investment firm, and two Indian non-banking financial companies, cKers Financial and woman-owned Electronica Finance Limited (EFL), to address this challenge.

Encourage Capital has invested USD 15 million in EFL, which will use the USAID-DFC loan portfolio guarantee to stimulate the rooftop solar market - representing a USD 9 billion market opportunity - for SMEs.

USAID will continue its support through providing technical assistance to address quality and safety concerns in the rooftop solar market. Once these credit guarantees lower the financial hurdle for installing rooftop solar, will realise numerous benefits resulting from the transition to this green technology.

These guarantees have the potential to unlock lifesaving social benefits and robust economic growth.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Thu, March 18 2021. 13:02 IST
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