Moody’s Report Calls For Sustainable Financing To Shift Towards RE In India

Moody's Report Calls For Sustainable Financing To Shift Towards RE

Moody, a financial service company, in its recent report, found a growing challenge faced by the renewable energy sector due to water scarcity in India. The report advocated for a shift towards renewable energy investments to mitigate these risks.

Moody’s report cautions against a decrease in the per capita water due to its increased usage for cooling and processing in the coal power and steel manufacturing sector. It projected a decrease in the water supply especially as the water availability per capita is projected to decrease significantly by 2031. Moody suggested that an increase in renewable energy investment would require an enhanced water management infrastructure to counter these threats.

The report emphasized the need to develop a sustainable finance market to develop the necessary critical infrastructure projects. It also emphasized on need to create new opportunities for financing projects that can improve water efficiency and support the transition to renewable energy. It emphasizes on assimilating the renewable energy investment with an improved water management system for economic stability and operational continuity of its power sector.

The report highlighted that coal power generators and steel-makers are most vulnerable to water stress in India. They are dependent on water for production, and as a result, they contribute to the growing water shortages. These industries rely on water supply which if disrupted, can hamper their operations and their revenue generation, thereby eroding their credit strength. 

This report emphasizes the need to create a sustainable finance market to help companies finance water investment. The sustainable financial investments market in India is small but it’s developing fast as a result, it can help companies and regional governments to raise funds. The report mentioned, “Some States facing severe water shortages have used the sustainable finance market to raise funds for investment in water management.”