New Delhi: India’s renewable energy (RE) developers have issued green bonds worth Rs 26,300 crore in the first half (H1) of 2021 alone, beating previous one-year records, according to a study released on Wednesday.
It added that India’s RE developers have raised more than Rs 78,200 crore since 2014 through green bonds issued in international markets, with Greenko and ReNew Power accounting for about 70 per cent of all issuances by value.
“Proceeds from the Rs 78,200 crore of capital raised have directly refinanced debt for over 10 GW worth of India’s RE projects,” said the study released by the CEEW Centre for Energy Finance (CEEW-CEF).
The report added that wind and solar accounted for 42 per cent each of this refinanced portfolio and represented a combined 8.4 GW capacity. Hydropower makes up the balance. This implies that 8.4 per cent per cent of India’s non-hydro RE capacity, totalling 100 GW, has been debt-financed with overseas capital.
“India’s non-hydro RE portfolio recently crossed the 100-GW mark, but we need to ramp up capital mobilisation to get to 450 GW by 2030… Green bonds will be essential for this transition, which requires investments of more than Rs 15 lakh crore in power generation capacity alone,” said Gagan Sidhu, director, CEEW-CEF, and co-author of the study.
He said that the outstanding exposure of Indian institutional lenders to the entire power sector stood at about Rs 13 lakh crore as of March 2020.
The findings highlight the potential of green bond markets to support India’s ambitious push to achieve energy-independence by 2047, a target recently announced by Prime Minister Narendra Modi.
According to the study, green bonds issued by Indian developers have generated high market interest, with average oversubscription at 360 per cent.
“So far, international green bonds have been primarily raised by India’s established utility-scale developers,” said Shreyas Garg, Consultant, CEEW-CEF, and lead author of the study.
Asian investors have shown the greatest appetite by picking up nearly 50 per cent of the bonds. However, the market remains nascent. Only eight Indian developers have accessed international bond markets as of June 2021, said the study.
Source: energy.economictimes.indiatimes.com
