International Finance Corporation (IFC) has proposed a $50 million loan facility to Italy-based Enel Green Power to fund its solar project in Rajasthan’s Bikaner.

The 300 MW Thar Surya solar photovoltaic (PV) project is being developed by Enel Green Power India, one of the step-down subsidiaries of Enel Green Power, an existing global client of IFC.

IFC is the lead arranger for the entire debt portion for the current venture and will mobilize $100 million debt through parallel lenders. According to IFC, the total cost of the project is estimated at $200 million.

The project was awarded to Enel Green Power in July 2020 by the Solar Energy Corporation of India (SECI). Enel will sell the generated electricity to SECI under a 25-year power purchase agreement. IFC is the mandated lead arranger for the entire debt portion.

The award was part of SECI’s auction for 2 GW of the interstate transmission system (ISTS) connected solar projects (Tranche IX) conducted in June 2020. Enel had quoted the second-lowest tariff of ₹2.37 (~$0.0314)/kWh for the 300 MW it had bid for.

Operating in 28 countries, Enel Green Power is one of the largest renewable energy developers globally, with 49 GW installed capacity across the wind, solar, geothermal, and hydropower projects.

In July last year, the Italian renewable energy company had announced that it had entered into a long-term joint investment (JV) partnership with Norwegian private equity company Norfund to set up renewable energy projects in India.

Enel Green Power said it would jointly finance, build, and operate new renewable projects in India with Norfund through its Indian subsidiary, Enel Green Power India.

In a bid to push green financing, IFC had asked its clients in the financial sector to increase their climate-related lending, reducing their exposure to coal to zero or close to zero by 2030. IFC has excluded coal-related investments from its loans.

Mercom had earlier reported that an increasing number of lending institutions are moving away from coal-based projects.