‘Indian record’ | ReNew borrows $1bn to build gigascale 24/7 green power that can rival coal
Developer to roll-out wind, solar and battery capacity for 'round-the-clock' output after finance deal said to be largest yet in nation's renewables sector
India’s ReNew Energy secured a $1bn loan to build 1.3GW of wind, solar and battery capacity that can provide round-the-clock (RTC) power competing with fossil generation.
The loan is said to be the largest of its type so far in the Indian renewables sector and will help Goldman Sachs-backed ReNew Energy build projects across Karnataka, Rajasthan, and Maharashtra states.
The developer said the capacity will “supply power day and night and compete against the baseload of fossil-fuel energy providers, such as coal”.
Japanese conglomerate Mitsui earlier this year took a 49% stake in the RTC project, which ReNew said is now underpinned by “the largest external commercial borrowings (ECB) project finance loan in the country's renewable sector”.
The developer will sell RTC power to India’s government-backed offtaker SECI at an initial rate of 2.90 rupees/kWh ($0.036/kWh), increasing by 3% annually for 15 years and then level for the remaining 10 years of the 25-year PPA.
Hybrid projects that combine the strong daytime generation profile of solar with the nighttime performance of wind, plus storage to closely match supply to demand, have rocketed up the agenda in India.
“Already, large corporate PPAs centred around developing hybrid projects are being signed. Central government has also issued multiple tenders around procuring hybrid power. The impact will increase even more as both the cost of hybrid projects and the production profile of hybrid projects match the need of utilities,” said Jain.
The $1bn loan was secured from a group of 12 international lenders led by Rabobank.
“The interest rate, after hedging, is expected to be lower than the Company's current average cost of debt on its balance sheet,” said the developer.
ReNew Energy CEO Sumant Sinha claimed it “highlights the interest of global lenders in ReNew as it helps spearhead India's historic clean energy shift and shows its continued ability to access financing at much lower rates than several years ago, despite the current volatility in the currency markets and a rising interest rate environment”.
India is chasing a goal to install 500GW of non-fossil capacity by 2030, with wind and solar accounting for the majority.
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