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USAID, DFC announces USD 41 Million for financing Renewable Energy solutions in India

USAID, DFC announce USD 41 mn financing for renewable energy in India

USAID, DFC announce USD 41 mn financing for renewable energy in IndiaUnited States Agency for International Development (USAID) & US International Development Finance Corporation (DFC) has announced a USD 41 Million (~ INR 297 Crore) Joint Loan Portfolio guarantee program for financing investments in renewable energy solutions including rooftop solar installations by Indian Small and medium-sized enterprises (SMEs).

  • Objective – To address the Financial hurdles facing rooftop solar project installations in India. It will benefit SMEs & residential consumers for securing finances needed for installing and using rooftop panels.
  • At present,  SMEs account for 48% of total energy consumed in India’s industrial sector.  Installing Rooftop solar power will enable SMEs to get access to reliable power & will also reduce their electricity costs.
  • The transition will also further progress towards India’s clean energy transition &  climate change mitigation.
  • USAID will also provide technical assistance for addressing the quality and safety concerns in the rooftop solar market.

Partner Agencies

USAID & DFC have partnered with US-based Encourage Capital & 2 Indian NBFCs (Non-Banking Financial Companies) namely  – ‘cKers Financial’ & women-owned ‘Electronica Finance Limited (EFL)’ for addressing the challenge of financing Rooftop Solar projects.

  • Encourage Capital has invested USD 15 Million (INR 108.72 Crore) in EFL using the USAID-DFC loan portfolio guarantee for boosting the rooftop solar market in India.
  • The rooftop solar market represents a USD 9 Billion market opportunity for SMEs.

Key Points

  • India’s commercial and industrial sectors pay high fees as electricity bills which makes rooftop solar a cost-saving investment.
  • Rooftop Solar Power Generation will help in boosting job creation & economic growth & also reduce carbon emissions & improving air quality.

India’s Targets:

  • India has set a target to install 175 GW of renewable energy capacity by the year 2022, which includes 100 GW from Solar, 60 GW from Wind, 10 GW from Bio-power & 5 GW from small hydro-power.
  • The government aims to achieve 40 GW renewable energy capacity by 2022 through the installation of rooftop solar projects.
  • Of the 40 GW, 4 GW to come from the domestic solar rooftop, whereas 16GW potential can be harnessed from MSMEs.

Recent Related News:

i.On November 19, 2020, Mastercard and USAID entered into a partnership under the Women’s Global Development and Prosperity Initiative (W-GDP) Initiative to launch Project Kirana.

About the United States Agency for International Development (USAID):

Acting Administrator – Gloria D. Steele
Headquarters – Washington D.C., USA

About  US International Development Finance Corporation (DFC):

Acting CEO – Dev Jagadesan
Headquarters – Washington D.C., USA