Bank of Baroda-KfW to Extend Funding of $113 Mn For Solar Projects in India

The tie-up will be funding solar power projects as a part of the Solar Partnership II – Promotion of Solar PV in India scheme, under the Indo-German Solar Energy Partnership.

Bank of Baroda has announced a partnership with Germany’s KfW Development Bank to extend funding of USD 113 million to refinance solar power projects in India.

The tie-up will be funding solar power projects as a part of the Solar Partnership II – Promotion of Solar PV in India scheme, under the Indo-German Solar Energy Partnership. Germany had in 2015 committed to providing financing support through KfW Development Bank for solar photovoltaic (PV) investments as part of an inter-governmental agreement.

In 2016, the Ministry of New and Renewable Energy (MNRE) in collaboration with Germany-based development bank KfW to set up two floating solar PV plants in the Maharashtra and Kerala, at an estimated cost of around USD 46.15 million.

“The KfW-funded floating solar park would be a showcase project that would demonstrate the technical viability of large solar projects,” said an MNRE senior official. “To begin with, at least 40 MW of floating solar capacity would be set up.”

In the same year, KfW also signed a € 20 million Loan Agreement with Indian Renewable Energy Development Agency Ltd. (IREDA) to be utilised for “Access to Energy” by financing Renewable Energy projects in India. This was the 6th Line of Credit (LoC) signed between KfW and IREDA on a standalone basis. IREDA aimed for providing financial assistance for off-grid solutions mainly through photovoltaic (PV) / hybrid mini-grids, PV irrigation pumps, household lighting systems, etc. to areas which have none or very limited access to modern energy services.

And then in 2018, State-run entity responsible for financing rural infrastructural projects, Rural Electrification Corporation (REC) signed a loan agreement with German bank KfW worth euro 200 million for funding renewable energy projects. REC’s fourth line of credit under Indo-German Development Cooperation with the objective to fund green energy projects in India.

REC Chairman and Managing Director, P V Ramesh said at the time, “This is yet another step towards promoting renewable energy in India after having more than tripled our financing in the renewable sector last year. The partnership reflects the commitment of both the institutions towards sustainable development.”