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Past Issue • Jul-Sep 2014

Solving India’s Renewable Energy Financing Challenge: Instruments to Provide Low-cost, Long-term Debt

India’s renewable energy growth plans will be most likely hindered by financing problems. Charith Konda makes the case for exploring alternative modes of financing for renewable power projects, by leveraging existing resources effectively. The government of India plans to more than double the renewable energy capacity installed in the country from 25 GW in 2012 to 55 GW by 2017 (The Hindu, 2013a). However, renewable energy is still approximately 52-129% more expensive than conventional power (CPI, 2014). In our previous work (CPI, 2012), we found that the biggest barrier to renewable energy in India is the inferior terms of debt – i.e., high cost, short tenor, and variable rate – which raises the cost of renewable energy in India by 24-32% compared with similar projects in the US.

ABOUT THE AUTHORS

  • Charith-Konda

    Charith Konda

    Charith Konda is an analyst with the CPI-ISB Energy and Environment Programme, Hyderabad office, a joint programme set up by the Climate Policy Initiative (CPI) with the Indian School of Business (ISB).
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