Modi’s renewable thrust powered by Hinduja Group push with $1 b investment in solar
With the thrust of Prime Minister Narendra Modi on putting India on the renewable energy map, a number of renowned corporates are being lured to invest in this segment. Hinduja Group, one of the leading conglomerates stated that it is all set to pump in about a billion dollars to set up solar-based power units in the country to generate 1,000 MW. Shom Hinduja, the 23-year-old son of Group Chairman Ashok Hinduja, is spearheading the entry into the solar power business.
Gopichand P Hinduja, Co-Chairman of the $25-billion Group said “We have identified locations in three States, including Rajasthan and Gujarat”. The company has acquired land and is in talks with three potential partners, of which one will be selected after due diligence.
YES Bank announced separately that it is issuing India’s first Green Infrastructure Bonds to raise ₹500 crore. This follows State Bank of India’s decision to commit 75,000 crore to fund renewable energy projects. Given the Centre’s focus on India’s renewable energy potential and the target of 175 GW of additional capacity installation by 2022, it is estimated that the renewable energy sector will require significant financing.
Talking about the challenges faced YES Bank said, “Currently, there are a number of challenges in the existing financing mechanisms, including sector limits, high interest rates and asset-liability mismatch and, therefore, there is a need to evolve innovative financing mechanisms to aid projects in the renewable energy and energy efficiency space,”
According to market analysts, Government support will be required to meet these targets. “The technology curve for solar power is evolving. In the past two years, capital cost per MW has fallen from 14 crore to less than 8 crore. Consequently, average solar tariff rates have declined from 15 per kWh to 8 per kWh.”
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