Renewable energy is the present-day buzzword in India. Backed by a positive attitude by the new government, some of the country’s green energy companies have started attracting major investments, a case in point being the ReNew Power Ventures raising US $140 million as fresh investment.
As reported by MetalMiner the funds will come from the three investors, including the Asian Development Bank (ADB). The new funding from the ADB, the Goldman Sachs Group and GEF SACEF India, a fund managed by alternative-asset investment firm Global Environment Fund, will take the total equity investment of the privately-owned Indian firm to $390 million.
In 2011, the Mumbai-based company had received a $250 million equity investment from Goldman Sachs.
What’s even more interesting was this development on Thursday when the World Bank said it was keen on investing US $775 million in clean-energy projects across the nation, expressing its willingness to partner with the Government of India (GoI) in clean energy investments.
The revival of the renewable energy sector, even as the traditional energy sectors languish, say analysts, rides on a hope that’s promising because Prime Minister Narendra Modi is known for his support to green energy. A report in The Economic Times quoted Ashish Khanna, lead energy specialist at the World Bank, saying the support shown by the new government towards clean energy was “quite encouraging” and was expected to give a much-needed push to the sector, and unlock outside investments.
In sync with such sentiments, both, solar and wind power found a mention in the National Democratic Alliance’s maiden Union Budget proposals presented in the Indian Parliament earlier this month. The finance minister allocated about $200 million (Rs 1200 crore) for solar projects.
The new government’s view is that renewable energy must play a pivotal role in bringing power to every household in India. The decision to converge the three energy ministries – coal, power and renewable energy – into one, many Indian observers say, will provide a boost to this plan.
Of all the types of renewable energy, so far, India seems inclined toward solar. About four years ago, the GoI had set up the Jawaharlal Nehru National Solar Mission (JNNSM). A few weeks ago, the next round of bidding for solar power projects was announced as part of Phase 2 of the JNNSM. The first round of bids, during which solar power projects worth 750 megawatts were tendered, was carried out in January this year. In the second phase, 1500 MW of projects will be up for bidding, which means, when completed, 2,250 MW of solar power will be available.
According to reports in the Business Standard, the government has begun work to assess the viability of four “megascale” renewable projects in the Thar Desert in Rajasthan, Rann of Kutch in Gujarat – both in central India – and in the northern, snow-bound states of Himachal Pradesh, Jammu and Kashmir.
The proposed “desert mission” represents the latest boost to India’s Solar Mission, which aims to bring 20 giga watts of solar capacity online by 2022.
What is now required is the GoI spelling out clarity on long-term policy, regulations and financial support mechanisms for the ambitious plan.
The author, Sohrab Darabshaw, contributes an Indian perspective on industrial metals markets to MetalMiner.