India’s first World Bank solar park loans sanctioned for Madhya Pradesh

RUMSL is currently implementing the two solar parks - Rewa with 750MW capacity and Mandsaur with 250MW capacity. Flickr: Christopher Kray

Indian Renewable Energy Development Agency Limited (IREDA) has signed an agreement with Rewa Ultra Mega Solar Limited (RUMSL) to finance two major solar parks in the state of Madhya Pradesh with a first loan of INR2.1 billion (US$33 million).

Late last year, the World Bank agreed with the Ministry of New & Renewable Energy (MNRE) and IREDA to channel US$100 million into financing ultra-mega solar parks in India, of which 38 have been sanctioned to date, according to a recent posting by MNRE. The RUMSL loan is the first from the World Bank’s line of credit to be sanctioned by IREDA, the organisation responsible for dispersing the financing.

RUMSL is a joint venture between the state Discom Madhya Pradesh Urja Vikash Nigam Limited (MPUVNL) and the Solar Energy Corporation of India (SECI) whose role is to implement the solar parks, namely Rewa (750MW) and Mandsaur (250MW). 

The loan to RUMSL includes a fixed interest rate of 8.5% per annum for the entire loan tenure, moratorium from principal repayments up to five years and a loan repayment period of up to 20 years.

K.S. Popli, CMD, IREDA, thanked the Department of Economic Affairs (DEA) for reducing the Sovereign Guarantee fee to 0.5%, which he said would also help in providing similar solar park support in other states.

Upendra Tripathy, interim director general, International Solar Alliance, highlighted the unique payment security mechanism for the Rewa solar projects, which led to them achieving some of the lowest ever solar tariffs in India in early 2017, reaching as low as INR3.30/kWh (US$0.052) on levelised basis.

Out of the total power proposed to be generated at Rewa solar park, 24% will be purchased by Delhi Metro Rail Corporation and the remaining 76% by Madhya Pradesh Power Management Company (MPPMCL).

Read Next

September 14, 2022
Tata Power Solar Systems has received a “letter of award” of INR5.96 billion (US$75 million) from NHDC to set up a 125MWp floating PV project in India.
July 18, 2022
India’s government will stop the electronic reverse auctions of renewables projects in the country amid fears it is leading to “unhealthy competition”.
July 4, 2022
The World Bank has approved US$165 million in additional financing to support 450MW of rooftop solar deployment in India and make distributed generation systems in the country more affordable.
June 13, 2022
The Indian solar sector looks set for significant levels of disruptions over the next two years, with the government’s drive to establish a domestic manufacturing base risking deployment and investments needing to double if it is to meet its climate targets, according to industry analysts.
June 8, 2022
India has relaxed its rules surrounding the purchase of renewable power, with commercial and industrial consumers allowed to purchase clean power on voluntarily basis, while state distribution company (Discom) customers can demand to be supplied with renewable electricity.
May 6, 2022
Tata Power Solar has landed what it claims to be India’s largest single solar EPC order of 1GW for roughly INR5500 crore (US$715 million) from Indian state-owned utility SJVN Ltd.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
October 4, 2022
New York, USA
On-Demand Webinars, Solar Media Events
October 11, 2022
Virtual event
Upcoming Webinars
October 18, 2022
10am (EDT) / 4pm (CEST)