State-owned company IREDA's share in project financing in the renewable energy sector has over the years seen a decline, the Comptroller and Auditor General (CAG) has said.
"Indian Renewable Energy Development Agency Limited was not able to sustain its position as a leading financial institution in the renewable energy sector," the CAG said in a report.
The government auditor observed that IREDA's share in the total commissioned capacity of renewable energy sources was 52.83 per cent at the beginning of the 10th Plan (2002-07), which dived to 19.21 per cent at the end of it and further, to 7.66 per cent at the closure of the 11th Plan (2007-12).
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The fast-growing renewable energy sector has attracted many players in the financing space, which meant a big challenge for IREDA.
The CAG said that despite IREDA appointing a consultant to draw up a Corporate Plan for 2007-12, it existed only on paper.
It went on to add: "The prescribed timeframes laid down for achieving various activities were either not adhered to or the activities were not taken... (which were) carried forward to the subsequent Corporate Plan for 2012-17. This defeated the purpose of having a Corporate Plan in the first place."
There were delays in sanctioning projects and nearly 40 per cent of projects sanctioned between 2008-09 and 2012-13 were cleared after an average delay of 66 days, beyond the prescribed limit of three months, the CAG pointed out.
More than 65 per cent of the loan applications received between 2008-09 and 2012-13 were dropped by IREDA, which did not do due diligence, it noted.
To improve efficiency, the CAG suggested that the Board of Directors of IREDA should coordinate and monitor execution of the Corporate Plan to explore new business opportunities.
It also called for adherence to the prescribed credit exposure and due diligence while sanctioning loans.
The CAG has also asked IREDA to keep tabs on outstanding loans for reduction in non-performing assets.
IREDA is a key central public sector enterprise that exclusively finances renewable energy projects.
